Custom, Excise & Service Tax Tribunal
Present For The Appellant : Shri M. S. ... vs Present For The Respondent : Shri K.S. ... on 5 January, 2011
IN THE ,CUSTOMS, EXCISE & SERVICE TAX
APPELLATE TRIBUNAL
SOUTH ZONAL BENCH, FKCCI COMPLEX, K.G. ROAD,
BANGALORE 56009.
DATE OF HEARING : 5/1/2011
DATE OF DECISION : 5/1/2011
Central Excise Appeal No. 556/2010
[Arising out of Order-in-Appeal No. 298/2009-CE dated 23.12.2009, passed by the Commissioner of Central Excise (Appeals-I), Bangalore)
For approval and signature:
Honble Shri M. V. Ravindran, Member (Judicial)
1 Whether Press Reporters may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982? No
2. Whether it should be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not ? No
3. Whether Their Lordships wish to see the fair copy of the Order? Seen
4. Whether Order is to be circulated to the Departmental authorities? Yes
M/s MTR Foods Ltd.,
Bangalore.
Versus
The Commissioner of Central Excise,
Bangalore. Appellant
Respondent
Present for the appellant : Shri M. S. Srinivasa, Advocate Present for the respondent : Shri K.S. Chandrasekhar, JDR CORAM : Honble Shri M. V. Ravindran, Member (Judicial) ORDER No..Dated 05/01/2011 Per : M. V. RAVINDRAN This appeal is directed against the Order-in-Appeal No. 298/2009-CE dated 23.12.2009.
2. Heard both sides and perused the records.
3. The issue involved is regarding Cenvat credit of service tax paid on services of CHA engaged by the appellant for export of their products. The appellants availment of Cenvat credit of service tax paid on the services rendered by CHA has sought to be disallowed by the Revenue on the ground that the said service would not fall under the category of input service and that service cannot be related to business activities as it is being conducted at part i.e. beyond the place of removal.
4. The learned Counsel appearing on behalf of the appellant draws my attention to the following decisions of the Tribunal in identical set of facts:
(i) CCE, Rajkot Vs. Rolex Rings (P) Ltd. [2008 (230) E.L.T. 569 (Tri.-Ahmd.)]
(ii) CCE, Rajkot Vs. Adani Pharmachem (P) Ltd. [2008 (232) ELT 804 (Tri.-Ahmd.)]
(iii) Leela Scottish Lace Pvt. Ltd.Vs. C.., Bangalore [2010 19) STR 69 (Tri.-Bang.)]
(iv) CCE, Chennai Vs. Fourrts (I) Laboratories Pvt. Ltd. [2010 (19( STR 6 (Tri.-Chennai)]
(v) Adani Pharmachem (P) Ltd. Vs. CCE, Rajkot [2010 (20) STR 386 (Tri.-Ahmd.)]
(vi) Mileen Engineers Vs. CCE, Mumbai-III [2010 (20) STR 668 (Tri.-Mumbai)] He also submits that the Honble High Court of Bombay in the case of Commissioner of Central Excise, Nagpur Vs. Ultratech Cement Ltd. [2010 (20) S.T.R. 577 (Bom.)] has reiterated the fact that the services which are required for the activities relating to business, the service tax paid on such services cannot be denied as Cenvat credit. It is also submits that the Commissioner (Appeals) in paragraph 11 to the Order-in-Appeal has gone beyond the allegations made in the show-cause notice inasmuch as he concluded that some of the goods exported were exempted goods and the appellants could not have availed Cenvat credit on the activities relating to such goods.
5. The learned JDR reiterates the finding of the Commissioner (Appeals).
6. I have carefully considered the submissions made by both sides and perused the records. The issue is regarding whether the appellant is eligible to avail Cenvat credit of service tax paid on the services of CHA for export of goods in part. I find that the issue involved in this case has already been settled by various decisions as cited by the learned counsel. I reproduce the findings of this Tribunal in the case of Rolex Rings (P) Ltd. (supra) :
4. After considering the submissions made by both the sides and the reasonings adopted by Commissioner (Appeals), I find that the CHA and Surveyors services are utilized at the time of the export of the goods. The respondents continue to remain the owner of the goods in question till the same are exported. As such, it can be reasonable concluded that the place of removal in case of exported goods is the port area. The above interpretation is also supported by Para 8.2 of the Boards circular No. 91/8/2007-S.T. dt. 23-8-2007 laying down that where sale takes place at the destination point and the ownership of the goods remain with the seller till the delivery of the goods, the place of removal would get extended to the destination point and the credit of the service tax paid on the transportation up to such place of sale would be admissible. Inasmuch as in the present case also, the ownership of the goods remain with the seller till the port area, it can be safely held that all the services availed by the exporter till the port area are required to be considered as input service inasmuch as the same are clearly related to the business activities. Activities relating to business are covered by the definition of input service and admittedly CHA and Surveyors services are relating to the export business. As such, I agree with the reasonings adopted by Commissioner (Appeals) that the credit of duty paid on such services is admissible to the respondents. It is also noticed that the said decision has been followed in other various decisions cited by the learned counsel.
6. As regards the contention of the learned JDR on the findings of the Commissioner (Appeals) that the CHA service cannot be considered as activities in relation to business, in my considered view, the judgment of the Honble High Court of Bombay in the case of Ultratech Cement Ltd. (supra) squarely covers the issue in favour of the assessee.
7. As regards the contention raised by the learned counsel, that the Commissioner (Appeals) has gone beyond the scope of show-cause notice seems to ne correct, while coming to a conclusion that some of the goods exported by the assessee are exempted goods and the appellants could not have availed Cenvat credit on activities relating to such goods, I find that such allegations were not made out in the show-cause notice. The findings of the lower authorities are required to be within the allegations raised in the show-cause notice and the finding recorded by the Commissioner (Appeals) on the said allegations is beyond the show-cause notice, is undoubtedly not sustainable.
8. In sum, the impugned order is set aside and the appeal is allowed.
(Pronounced and dictated in the court) (M. V. Ravindran) Member (Judicial) /vc/