Custom, Excise & Service Tax Tribunal
Indian Dyestuff & Chemicals Mfg. Co vs Commissioner Of Central Excise, Thane I on 4 September, 2012
IN THE CUSTOMS EXCISE & SERVICE TAX APPELLATE TRIBUNAL
WEST ZONAL BENCH AT MUMBAI
Application No. E/Stay/1917/12
In
Appeal No. E/1253/12
(Arising out Order-in-Appeal No. YDB/61/TH-1/2012 dated 22.5.2012 passed by the Commissioner of Customs (Appeals), Mumbai I)
For approval and signature:
Honble Mr. P.R. Chandrasekharan, Member (Technical)
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 Yes
of the Order?
4. Whether Order is to be circulated to the Departmental Yes
authorities?
Indian Dyestuff & Chemicals Mfg. Co.
Appellant
Vs.
Commissioner of Central Excise, Thane I
Respondent
Appearance:
None for the appellant Shri M.S. Reddy, DC(AR) for the respondent CORAM:
Honble P.R. Chandrasekharan, Member (Technical) Date of hearing : 04.09.2012 Date of decision : 04.09.2012 O R D E R No:..
The appeal and stay application are directed against Order-in-Appeal No. YDB/61/TH-1/2012 dated 22.5.2012 passed by the Commissioner of Customs (Appeals), Mumbai I.
2. The appellant M/s. Indian Dyestuff & Chemicals Mfg. Co., Thane availed CENVAT credit amounting to Rs.2,23,890/- of the service tax paid on CHA services and travel agency service in relation to export of goods made by them. The department was of the view that since the services have been performed/received outside the place of removal, they do not qualify to be input service as defined in Rule 2(l) of the CENVAT credit Rules, 2004. Accordingly, the CENVAT credit was denied and interest on the wrong availment of CENVAT credit was demanded and an equivalent penalty was imposed under Rule 15 of the said Rule read with Section 11AC of the Central Excise Act, 1944.
3. None appeared for the appellant.
4. The ld. AR fairly submits that the issue involved in this case has been decided by this Tribunal in favour of the assessee in number of cases wherein it has been held that in the case of export, the port of export is the place of removal and not the factory gate and whatever services have been received up to the place of export can be considered as an eligible input service. Similarly, the travel agency service has been availed for overseas travel of the employees of the export firm for undertaking export promotion and therefore, it is an activity connected to the business of manufacture.
5. I have carefully considered the submissions. As the issue lies in a narrow compass, I am of the view that the appeal itself can be disposed of at this stage itself. Therefore, after dispensing with the requirement of pre-deposit of the dues adjudged, I take up the appeal for consideration and disposal.
5.1 The CHA services have been availed in respect of export of goods and as per the terms of contract of export, it is on FOB basis. Therefore, the place of removal is not the factory but the port of export as has been held by this Tribunal in the case of Kuntal Granites Ltd. vs. CCE 2007 (215) ELT 515, CCE vs. Adani Pharmachem P. Ltd. 2008 (232) ELT 804 and Leela Scotish Lace P. Ltd. vs. CC 2010 (19) STR 69. Therefore the services of CHA availed for export of goods is an eligible input service as defined in Rule 2(l) of the CENVAT credit Rules, 2004. As regards the travel agency services availed for booking of tickets for travel of the employees of the appellant firm abroad for purpose of export promotion, the same is integrally connected with the manufacturing activity of the appellant since export promotion is directly linked to the business of manufacture. The Hon'ble High Court of Bombay in the case of Ultra Tech Cement 2010 (260) ELT 369 (Bom) held that any service which has a nexus with the business of manufacture comes within the scope of input service as defined in Rule 2(l) of the CENVAT credit Rules, 2004. The ratio of this judgment applies to the facts of the present case. Accordingly, I hold that the appellant is rightly entitled for CENVAT credit of the service tax paid on the above mentioned services during the impugned period.
6. Accordingly, I allow the appeal filed by the appellant with consequential relief. The stay application is also disposed of.
(Dictated in Court) P.R. Chandrasekharan, Member (Technical) SR 4