Custom, Excise & Service Tax Tribunal
M/S Srf Limited vs Cce & St, Ltu, Delhi on 14 September, 2016
IN THE CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL West Block No. 2, R.K. Puram, New Delhi 110 066. Principal Bench, New Delhi COURT NO. III DATE OF HEARING : 14/09/2016. DATE OF DECISION : 14/09/2016. Excise Appeal No. 52273 of 2016 (SM) [Arising out of the Order-in-Appeal No. 07/CE/LTU/DLH/2016 dated 09/05/2016 passed by The Commissioner of Central Excise (Appeals), New Delhi.] For Approval and signature : Honble Shri V. Padmanabhan, 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 would be released under Rule 27 of : the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not? 3. Whether their Lordships wish to see the fair :Seen copy of the order? 4. Whether order is to be circulated to the :Yes Department Authorities? M/s SRF Limited Appellant Versus CCE & ST, LTU, Delhi Respondent
Appearance Shri R. Krishnan, Advocate for the appellant.
Shri M.R. Sharma, Authorized Representative (DR) for the Respondent.
CORAM: Honble Shri V. Padmanabhan, Member (Technical) Final Order No. 53594/2016 Dated : 14/09/2016 Per. V. Padmanabhan :-
The present appeal is directed against the order dated 09/5/16 passed by the Commissioner (Appeals), New Delhi. The appellant is a manufacturing unit in Viralimalai in Tamilnadu, engaged in the manufacture of Industrial Fabrics. The present dispute is about the Cenvat credit availed by the appellant on input services. The Original Authority vide his order dated 30/4/14 disallowed Cenvat credit to the extent of Rs. 8,18,150/- in respect of service tax paid on the freight for outward transportation. When this order was challenged before the Commissioner (Appeals), he allowed Cenvat credit to the extent of Rs. 2,22,393/- and disallowed the balance. The submission of the appellant is that out of the amount disallowed, an amount of Rs. 4,44,502/- is relating to the service tax paid on inward transportation of raw materials, whereas the balance amount of Rs. 1,09,652/- was relating to outward transportation of finished products. With reference to the disallowance of inward transportation, the appellant admits that the full details of the split up of inward as well as outward transportation could not be submitted before the original Adjudicating Authority. However, these details were submitted before the First Appellate Authority, but the same has not been considered and discussed by him in the impugned order. He further submits that with reference to the outward transportation of goods, the credit is required to be allowed for the reason that the goods are cleared by the appellant to the customer on CIF basis and excise duty stands paid without claiming abatement for freight.
2. I heard Shri R. Krishnan, Advocate, for the appellant as well as Shri M.R. Sharma, learned DR for the Revenue.
3. The learned Advocate for the appellant has submitted copies of the relevant documents. He has submitted copies of some sample documents in the nature of transporter bills under which the appellant has received raw materials from various suppliers which clearly evidence the fact that these receipts are for transportation of goods to the appellants factory. The learned Advocate further submits that he in a position to submit details of receipt of raw materials by the appellants factory from which it can be established that the service tax paid on these transportation bills are towards GTA for inward transportation of raw materials.
I have perused the documents submitted. Since these are in the nature of input services for which the service tax also has been paid by the appellant, they will be entitled to the Cenvat credit. However, for purposes of verification of these bills it would be necessary to remand the matter to the original Adjudicating Authority for verification before allowing Cenvat credit for inward transportation.
4. For determining the eligibility of Cenvat credit on outward transportation, the learned Advocate has submitted copy of some purchase order placed on the appellant company by a customer one such purchase order is No. 4500182785-0878 dated 23/11/2010. As per the terms and conditions of this purchase order it is clear that the terms of delivery would be CIF (Cost, Insurance and Freight). Further the purchase order is for delivery at the customers premises.
5. The definition of input service was amended vide Notification No. 10/2008-CE (NT) dated 01/3/2008 w.e.f. 01/4/2008. As per the amendment carried out to the definition of input service, it has been made clear that credit will be eligible for outward transportation only up to the place of removal. In the sample purchase order perused, I find that the terms and conditions of the contract state that the price agreed is for delivery at the premises of the customer and that the price is CIF. Accordingly, I find that the appellants claim is required to be allowed for Cenvat credit on outward transportation. However, the various purchase orders need be verified to confirm the terms whether they are similar to the purchase order produce before me. For this purpose also, it will be necessary to remand the case back to the original Adjudicating Authority. The appellant is directed to produce all necessary documents to establish their claim before the original Authority. The learned DR has no objections to remanding the matter. Accordingly, the appeal is allowed by way of remand.
(Dictated and pronounced in open court.) (V. Padmanabhan) Member (Technical) PK ??
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