Custom, Excise & Service Tax Tribunal
M/S. Mahanagar Gas Ltd vs Cce, Mumbai-V on 21 November, 2014
IN THE CUSTOMS, EXCISE AND SERVECE TAX APPELLATE TRIBUNAL, WEST ZONAL BENCH AT MUMBAI COURT NO. IV APPEAL NO. E/87304/14 - Mum (Arising out of Order-in-Appeal No. BR/19/MV/2013 dated 06.03.2013 passed by the Commissioner of Central Excise (Appeals), Mumbai-I.) For approval and signature: Honble Shri Anil Choudhary, Member (Judicial) =====================================================
1. Whether Press Reporters may be allowed to see : No
the Order for publication as per Rule 27 of the
CESTAT (Procedure) Rules, 1982?
2. Whether it should be released under Rule 27 of the : Yes CESTAT (Procedure) Rules, 1982 for publication
in any authoritative report or not?
3. Whether their Lordships wish to see the fair copy : Seen
of the order?
4. Whether order is to be circulated to the Departmental : Yes
authorities?
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M/s. Mahanagar Gas Ltd.
: Appellant
Versus
CCE, Mumbai-V
: Respondent
Appearance
Shri Padmavati Patil, Advocate
: For Appellant
Shri Ashutosh Nath, Asst. Commr. (A.R.)
: For Respondent
CORAM:
HONBLE SHRI ANIL CHOUDHARY, MEMBER (JUDICIAL)
Date of Hearing : 21.11.2014 Date of Decision: 21.11.2014
ORDER NO.......................................................
Per: Anil Choudhary:
The appellant is in appeal against the impugned order wherein CENVAT credit for input service namely Inward Transportation Service has been denied to the appellant.
2. The brief facts of the case are that the appellant is procuring gas from Gas Authority of India Ltd. (GAIL) through pipelines and the same was supplied through petrol pumps or through pipelines to the consumers. The appellant is availing CENVAT credit on inputs including on Inward Transportation Service and paying duty on their final product. At the end of the year, the appellant prepares a balance-sheet and account for Measurement Tolerance in their balance sheet showing shortage of gas lost during the supply as final product. Revenue is of the view that the shortage has occurred of inputs, consequently the input service credit was denied to the appellant. Proceedings were initiated, impugned order was passed. Aggrieved by that order, the appellant is before me.
3. The learned counsel for the appellant submits that in this case the CENVAT credit on inputs have not been denied of shortages but input service credit on transportation of these inputs have been denied by the department. It is not permissible. Moreover, the Measurement Tolerance has occurred on account of receipt of inputs and supply of finished goods. In these circumstances, whatever shortage may occur that may be lost during the process of manufacturing. Therefore, CENVAT credit cannot be denied. Therefore, impugned order is fit to be set aside and appeal be allowed.
4. On the other hand, learned A.R. reiterates the finding in the impugned order.
5. Heard the parties. Considered the submissions.
6. In this case, there is no dispute on account of availment of CENVAT credit on inputs. When there is no dispute regarding receipt of inputs, therefore, whatever transportation has been paid by the appellant on Inward Transportation Service is entitled for input service credit. Further, the Measurement Tolerance is on account of receipt of inputs and supply of finished goods. In these terms, it cannot be said the appellant has received the input in short quantity. Therefore, service tax on Inward Transportation is fully allowable as input service.
7. In these circumstances, I hold that the appellant has rightly taken the CENVAT credit on input service on Inward Transportation Service. Accordingly, impugned order is set aside, appeal is allowed with consequential relief, if any.
(Pronounced in open Court) (Anil Choudhary) Member (Judicial) Sp 3