Custom, Excise & Service Tax Tribunal
M/S Aquapharm Chemicals Pvt. Ltd vs Cce, Raigad on 11 February, 2014
IN THE CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL WEST ZONAL BENCH AT MUMBAI COURT NO. I Application No. E/S/98611/13 in Appeal No. E/89107/13 (Arising out of Order-in-Original No. 29/MAK (29) COMMR/RGD/13-14 dated 05.07.2013 passed by the Commissioner of Central Excise, Raigad). For approval and signature: Honble Shri P.R. Chandrasekharan, Member (Technical) 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? ====================================================== M/s Aquapharm Chemicals Pvt. Ltd. Appellant Vs. CCE, Raigad Respondent Appearance: Ms. Aparna Rao, Advocate for Appellant Shri B.S. Meena, Addl. Commissioner (A.R.) for Respondent CORAM: SHRI P.R. CHANDRASEKHARAN, MEMBER (TECHNICAL) SHRI ANIL CHOUDHARY, MEMBER (JUDICIAL) Date of Hearing: 11.02.2014 Date of Decision: 11.02.2014 ORDER NO. Per: P.R. Chandrasekharan
The appeal and stay petition are directed against the Order-in-Original No. 29/MAK (29) COMMR/RGD/13-14 dated 05.07.2013 passed by the Commissioner of Central Excise, Raigad. Vide the impugned order, the adjudicating authority has denied CENVAT credit amounting to Rs. 70,45,293/- on the CHA Services availed by the appellant M/s Aquapharm Chemicals Pvt. Ltd. in respect of export of their products during the period 2007-2008 to 2011-12. He also ordered to recover the interest apart from imposing penalty under Section 11AC of the Central Excise Act. Aggrieved of the same the appellant is before us.
2. The ld. Counsel for the appellant submits that the appellant exported the goods and for the activity of the export, they availed the service of CHA and paid service charges to the CHA. The CHA service is a taxable service and CHA correctly billed them for the services rendered alongwith Service Tax paid. The appellant thus paid the Service Tax on the CHA service and took credit of the same and utilized it in accordance with the provisions of CENVAT credit Rule, 2004. The appellant had a registered office at Pune, whereas the manufacturing unit is situated at Mahad. The exports were made by the registered office and bills for the export were also raised by the registered office. However, the goods were cleared from the appellants factory at Mahad under ARE-1 procedure. Since the goods were transported from the factory at Mahad to the port of export at JNPT, Nhava Sheva, sometimes CHAs name was mentioned as consignee in the transport documents and where the CHA name was not known, the registered office name was mentioned as the consignee. The credit has been denied only on the ground that since it was registered office, who was the exporter and it is the registered office, who has availed the service, the manufacturing unit at Mahad cannot avail CENVAT credit of the Service Tax paid on CHA services. This conclusion drawn by the adjudicating authority is not sustainable in law. There is no dispute that the CHA service is an eligible input service and this Tribunal in a number of decisions such as CCE, Rajkot Vs. Adani Pharmachem Pvt. Ltd. -2008 (12) STR 593 (Tri.-Ahmd.), MTR Foods Ltd. Vs. CCE, Bangalore 2011 (22) STR 342 (Tri-Bang) and Echhay Forgings Pvt. Ltd. Vs. CCE, Raigad 2012TIOL769 CESTAT-MUM had held that CHA services are an eligible input service. Merely because the export document has the name of the registered office of the appellant, credit cannot be denied as the goods have been manufactured at Mahad unit and transported for exportation from the Mahad unit. Therefore availment of the credit on the CHA service as input service is correct and valid and, therefore, the impugned demands are not sustainable in law. Accordingly, the ld. Counsel pleads for grant of stay and allowing the appeal.
3. The ld. Addl. Commissioner (A.R.) appearing for the Revenue, on the other hand, reiterates the findings of the adjudicating authority. It is his contention that since the exporter has its registered office in Pune, it is the registered office who has availed the CHA service. Therefore, the appellant cannot avail the CENVAT credit on such CHA service. Accordingly, he pleads for putting the appellant to terms.
4. We have carefully considered the rival submissions.
4.1 We find that the issue involved lies in a narrow compass, therefore, the appeal itself can be disposed of at this stage. Hence, after dispensing with the requirement of pre-deposit and with the consent of both sides, we take up the appeal for consideration and disposal.
4.2 The only issue for consideration is whether the manufacturing unit at Mahad of the appellant which is a manufacturer and exporter of the goods can avail CENVAT credit of Service Tax paid on CHA services in respect of the goods exported, when the exporter has a registered office at Pune. It is not in dispute that the goods were manufactured at Mahad unit and transported from there to the port of export and the CHA service was availed for the goods manufactured at the Mahad. Therefore, we do not find any infirmity or any provisions in law which prohibits the Mahad unit from availing credit of the Service Tax paid on the CHA service for export of the goods. Accordingly, we hold that the impugned order is not sustainable in law. Hence, we set aside the same and allow the appeal. The stay application also stands disposed of.
(Dictated and pronounced in Court)
(Anil Choudhary) (P.R. Chandrasekharan)
Member (Judicial) Member (Technical)
Sinha
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