CESTAT, Bangalore Bench
Commissioner of Central Excise
v.
Flowserve Microfinish Pumps (P.) Ltd.
DR. S.L. PEERAN, JUDICIAL MEMBER
APPEAL NO. ST/336 & 337 OF 2006
FINAL ORDER NOS. 1066 & 1067 OF 2007
September 10, 2007
Rule 2(P) of the Cenvat Credit Rules, 2004
- Cenvat credit - Output service - Whether assessee is eligible to utilize
credit of duty paid on input services of Goods Transport Services for paying
duty on output services of Goods Transport Services - Held, yes [Para 5]
Facts
The assessee was manufacturer of excisable goods. It was paying service tax as a recipient of goods transport service. It availed cenvat credit of such service tax paid towards payment of next instalment of service tax on output services of goods transport services. The original authority denied cenvat credit on the ground that the assessee was not provider of taxable services but a person responsible for making payment of service tax. On appeal, the Commissioner (Appeals) upheld the utilization.
On revenue’s appeal :
Held
The Tribunal in the case of CCE v. Nahar Industrial Enterprises Ltd. [2007] TIOL 555, after due consideration of the very same issue held that service tax can be paid from cenvat credit and the revenue’s appeal had been dismissed. Like-wise the Tribunal in India Cement Ltd. v. CCE, - 2007 TIOL 645 also allowed the assessee’s appeal and held that GTA service received for clearance of product from factory is deemed ‘output service’ by virtue of the explanation under Rule 2(p) and hence, it has been held that cenvat credit can be utilized for payment of Service tax of such ‘output service’. In view of above noted decisions, the demand of service tax and penalty was to be set aside and the revenue’s appeal was to be dismissed. [Para 5]
India Cement Ltd. v. CCE, [2007] 7 STR 569 (CESTAT-MAD) and CCE v. Nahar Industrial Enterprises Ltd. [2007] 10 STT 117 (CESTAT- Delhi) - Followed. [Para 5]