2024-VIL-208-CESTAT-CHE-CE
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CENTRAL EXCISE CESTAT Cases

Central Excise – Larger Bench - GTA Service - Eligibility of CENVAT credit on Goods Transport Agency service - ascertainment of ‘place of removal’ - admissibility of CENVAT credit on the service tax paid on GTA (outward transportation of goods) service post Supreme Court judgement in Commissioner of Central Excise & S.T vs. Ultra Tech Cement Ltd. case and issue of CBEC Circular dated 08.6.2018 - admissibility of CENVAT credit on GTA service i.e., “outward transportation of finished goods up to the place of delivery, for the period after 01.04.2008 in view of the judgment of the Supreme Court in Ultra Tech Cement and the CBEC Circular dated 08.06.2018 - Difference of opinion between two Benches – Reference to Larger Bench – application of observation of the Supreme Court in para 13 of Ultratech Cements to the circumstances where CENVAT credit on GTA services for outward transportation of goods from the factory to the buyers’ premises has been denied where the goods are sold on FOR basis – ascertainment of ‘place of removal’ for the purpose of allowing Cenvat credit on the GTA service - HELD - the Supreme Court, though in paragraph 13 of Ultratech Cements case observed that CENVAT credit on Goods Transport Agency availed for transport of goods from place of removal to buyers’ premises was not admissible, but the principles in ascertaining the place of removal in the context of admissibility of CENVAT credit on GTA Services have not been laid down and the said issue has been left open to be decided on the facts of each case - The Karnataka High Court in Bharat Fritz Werner considered the judgment of the Supreme Court in Ultratech Cements and also the Circular dated 08.06.2018 of the Board and the judgments of Supreme Court in Emco Ltd. and Roofit Industries to conclude that the place of removal is the buyer’s premises - No evidence has been placed by either side that the said judgment of the Karnataka High Court has been challenged before the Supreme Court by the department - In such circumstances, it is the judgment of Karnataka High Court which would be binding on the Tribunal - In the result, in a case where clearances of goods are against FOR contract basis, the authority needs to ascertain the ‘place of removal’ by applying the judgments of the Supreme Court in Emco and Roofit Industries, the decision of the Karnataka High Court in Bharat Fritz Werner, and the Circular dated 08.06.2018 of the Board to determine the admissibility of CENVAT credit on the GTA Service upto the place of removal - The reference is answered accordingly
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