Custom, Excise & Service Tax Tribunal
Builders Fibres Pvt Ltd vs Commissioner Of Central Excise, ... on 7 November, 2017
CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL SOUTH ZONAL BENCH BANGALORE Appeal(s) Involved: E/21418/2017-SM [Arising out of Order-in-Appeal No. 29/2017 dated 03/07/2017 passed by Commissioner of Central Excise , BANGALORE-II( Appeal) ] Builders Fibres Pvt Ltd No 42 KIADB Industrial Area DODDABALLAPUR - 561203 KARNATAKA Appellant(s) Versus Commissioner of Central Excise, Customs and Service Tax Bangalore-I POST BOX NO 5400, CR BUILDINGS, BANGALORE, - 560001 KARNATAKA Respondent(s)
Appearance:
MR. Sunder Raman, Advocate RAMESH ANANTHAN ADVOCATE 586, 44TH CROSS, JAYANAGAR 8TH BLOCK BANGALORE - 560082 KARNATAKA For the Appellant Mr. Naveen Kushalappa, AR For the Respondent Date of Hearing: 07/11/2017 Date of Decision: 07/11/2017 CORAM:
HON'BLE SHRI S.S GARG, JUDICIAL MEMBER Final Order No. 22732 / 2017 Per : S.S GARG The present appeal is directed against the impugned order dated 3.7.2017 passed by the Commissioner (A), whereby the Commissioner (A) has held that the amount of Rs.1,49,441/- only is liable to be rejected for refund.
2. Briefly the facts of the present case are that the appellants are engaged in the manufacture of PP Woven Fabrics, FIBC Bags and PP Woven Sacks falling under Chapter Subheading 30269080 and 39232990 respectively of the Central Excise Tariff Act, 1985. They are also availing the facility of CENVAT credit under CENVAT Credit Rules, 2004. Since the appellants had no DTA sales to utilize the accumulated CENVAT credit, they preferred a refund claim of unutilized CENVAT Credit amounting to Rs.7,72,500/- for the period January 2010 to March 2010 with the Assistant Commissioner of Central Excise, Bangalore. It appeared that the appellants had requested for advance refund of 80% of the refund claim as per CBEC Circular No.828/5/2006-CX dated 20.4.2006 under simplified procedure for sanction of refund. The sanctioning authority sanctioned an amount of Rs.6,18,000/- vide his letter dated 23.7.2010. It appeared from the verification of appellants input documents that they had contravened the provisions of Notification No.5/2006 dated 14.3.2006 and Rule 5 of CENVAT Credit Rules as they had taken credit on outward freight and thereby rendered themselves liable for penal action and recovery of ineligible credit and refund. Hence, it appeared that the amount of Rs.6,18,000/- already refunded to be erroneous and the appellants were issued with a show-cause notice dated 12.1.2011 by the sanctioning authority proposing to reject the entire refund claim along with recovery of the amount already refunded with interest and penalty. It further appeared that out of the total claim, Rs.5,15,000/- pertained to input services. The adjudicating authority after following the due process, demanded an amount of Rs.5,15,000/- along with interest. Aggrieved by the said order, the appellant filed appeal before the Commissioner (A), who has held that only an amount of Rs.1,49,441/- is liable to be rejected and the rest of the amount is eligible for refund.
3. HeHHeard both the parties and perused the records.
4. The learned counsel for the appellant submitted that the impugned order is not sustainable in law as the same is passed contrary to the binding judicial precedent on the same issue. Learned counsel further submitted that the issue involved in the present case is no more res integra and has been settled by various decisions of the Tribunal and the High Court. He further submitted that the Commissioner (A) has wrongly held that the place of removal is the factory gate in case of export of goods and therefore, the CENVAT credit in respect of GTA service not allowed. He further submitted that this finding of the Commissioner (A) is contrary to the Board Circular No.97/8/2007-ST dated 23.8.2007 wherein the Board has clarified that if the freight charges are integral part of the price, then the service tax on the same is eligible to be taken as credit. He also submitted that in this case, the price for the export of goods is FOR and as such, it includes the cost of transport. In support of his submission, he relied upon the following decisions:
* CCE vs. Stangl Pickles & Preserves: 2011 (22) STR 396 (Tri.-Chennai) * Meghachem Industries vs. CCE: 2011 (23) STR 472 (Tri.-Ahmd.) * Oriental Containers Ltd. vs. CCE: 2012 (28) STR 397 (Tri.-Mum.) * Ashirvad Pipes Pvt. Ltd. vs. CCE: 2013 (31) STR 693 (Tri.-Bang.) * Hema Engineering Industries Ltd. vs. CCE: 2016 (46) STR 439 (Tri.-Del.)
5. On the other hand, the learned AR reiterated the findings of the impugned order.
6. After considering the submissions of both the parties and perusal of the decisions relied upon by the appellant cited supra, I am of the considered view that in case of export of goods, the place of removal is the port of export and therefore, the appellant is entitled to the CENVAT credit on GTA up to the port. Following the ratio of the above decision, the appeal is allowed by setting aside the impugned order.
(Operative portion of the Order was pronounced in Open Court on 07/11/2017) S.S GARG JUDICIAL MEMBER rv...
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