M/S Aadi Plastic Industries Pvt. Ltd vs Commissioner Of Central Excise, ...

IN THE CUSTOMS, EXCISE AND SERVECE TAX APPELLATE TRIBUNAL, WEST ZONAL BENCH AT MUMBAI COURT NO. IV

APPEAL NO. E/963/11  MUM

(Arising out of Order-in-Appeal No.PII/AV/29/2011 dated 29.04.2011 passed by the Commissioner of Central Excise (Appeals), Pune.)

For approval and signature: Honble Shri Anil Choudhary, Member (Judicial)

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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 : Seen of the order?

4. Whether order is to be circulated to the Departmental : Yes authorities? =====================================================

M/s Aadi Plastic Industries Pvt. Ltd.

: Appellant Versus

Commissioner of Central Excise, Kolhapur : Respondent

Appearance Shri N.A. Nyalkalkar, Advocate : For Appellant Shri Ashutosh Nath, Asst. Commissioner (A.R.) : For Respondent

CORAM: HONBLE SHRI ANIL CHOUDHARY, MEMBER (JUDICIAL)

Date of Hearing : 06.04.2015 Date of Decision: 06.04.2015

ORDER NO.......................................................

Per: Anil Choudhary:

The appellant M/s Aadi Plastic Industries Pvt. Ltd. is in appeal against Order-in-Appeal No. PII/AV/29/2011 dated 29.04.2011 passed by the Commissioner of Central Excise (Appeals), Pune.

2. The brief facts are that the appellant is engaged in manufacture of plastic articles falling under Chapter Head 39 of Central Excise Tariff Act, 1985 and has availed the facility of CENVAT credit. One of their consignors M/s Haldia Petrochemicals Ltd. were supplying input for final product as plastic granules. M/s Haldia Petrochemicals Ltd. has paid the Service Tax on behalf of the applicant on the GTA for transporting the inputs. The department denied CENVAT credit availed by the applicant on the ground that the Service Tax paid on GTA by M/s Haldia Petrochemicals Ltd. on the applicants behalf.

3. The contention of the applicant is that as per Circular No. 97/8/2007 dated 23.08.2007 in para 8.1(b) it was clarified that inward transportation of inputs or capital goods, such service would qualify to be called as input service and thus the Service Tax paid on it would be eligible as credit to the receiver if he is either a manufacturer of excisable goods or a provider of taxable service. The contention is that the Tribunal in the case of Rathi Bars Ltd. Vs. CCE, Jaipur  2012 (283) ELT 565 (Tri.-Del.) while relying the aforesaid Boards Circular allowed the appeal of the assessee.

4. The learned Counsel further argues that the issue is squarely covered by the Board's Circular as well as by the ruling of this Tribunal in the case of Rathi Bars Limited (supra) and other cases. The only dispute raised by the Revenue in their communication dated 30.11.2009 is that the service tax on the goods dispatched to the appellant, was paid by HPL (consignor) who are not provider of transport service but have paid service tax on GTA as recipient of transport service. Therefore credit on the said GTA is not admissible to the appellant. The appellant states that the receiver of transport service is the appellant only, whereas that the transport was arranged by the supplier-HPL, of goods on behalf of the appellant. In ordinary case the appellant himself arranges for transport of the goods from the factory of supplier to its factory. Accordingly he prays for allowing the appeal with consequential benefits.

5. The learned A.R. relies on the impugned order. The learned A.R. further emphasises that in the facts of the given case the service receiver is not the appellant and accordingly prays for upholding the impugned order.

6. Having heard the parties and considered the rival contentions, I hold that in the facts of this case it is the appellant who is the receiver of transport service. It is immaterial as to who facilitates the transportation to the appellant. Accordingly I hold that the appellant is entitled to service tax credit or CENVAT credit on the transportation charges incurred for transport of inputs and materials to its factory. Thus the appeal is allowed with consequential benefits, if any.

(Pronounced in open Court)

(Anil Choudhary)

Member (Judicial)

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