M/S Flint Group India vs Commissioner Of Central Excise, ...

[Arising out of Order-in-Appeal No. 05 TO 07/2009 dated 20/01/2009 passed by Commissioner of Central Excise (Appeals-I), Bangalore] For approval and signature:

1 Whether Press Reporters may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982? No 2 Whether it should be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not? No 3 Whether Their Lordships wish to see the fair copy of the Order? Seen 4 Whether Order is to be circulated to the Departmental authorities? Yes

M/s FLINT GROUP INDIA PVT. LTD., (FORMERLY INCOWAX PRIVATE LIMITED) 47D, BOMMASANDRA INDUSTRIAL AREA, BANGALORE Appellant(s) Versus

Commissioner of Central Excise, BANGALORE - I Respondent(s)

Appearance:

Mr. Paramjit Singh, G.M. (Legal) (Authorised Representative) For the Appellant Mr. N. Jagdish, A.R. For the Respondent

Date of Hearing: 16/10/2015 Date of Decision: 16/10/2015 CORAM:

HONBLE SHRI ASHOK K. ARYA, MEMBER (TECHNICAL)

Final Order Nos. 22068 - 22070 / 2015

PER ASHO K. ARYA Appellants, M/s Flint Group India Pvt. Ltd. are engaged in the manufacture of Printing Ink, Paper Coating Varnish, Reducer etc. falling under Chapters 29, 32 & 38 of the 1st Schedule to the Central Excise Tariff Act, 1985. They were availing Cenvat credit of service tax paid on outward freight charges under Cenvat Credit Rules, 2004.

2. The issue involved is denial of Cenvat credit of service tax paid on outward freight charges for delivering the goods from the factory to the customers premises amounting to Rs. 69,274/-, Rs. 65,011/- and Rs. 5,986/- respectively for different Orders-in-Original. The impugned order passed by the Commissioner (Appeals) states that the appellant has not been able to fulfill the condition number (iii) given in Boards Circular No. 97/8/2007-S.T. dated 23.8.2007. The condition (iii) of above Circular is :

(iii) the freight charges were an integral part of the price of goods. In such cases, the credit of the service tax paid on the transportation up to such place of sale would be admissible if it can be established by the claimant of such credit that the sale and the transfer of property in goods (in terms of the definition as under Section 2 of the Central Excise Act, 1944 as also in terms of the provisions under the Sale of Goods Act, 1930) occurred at the said place.

3. The impugned order also states that the appellants did not give any documentary proof proving the compliance of the condition and therefore, were not eligible to avail Cenvat credit of service tax paid on outward freight charges from the place of removal; thus, disallowed the credit.

4. Mr. Paramjit Singh, authorized representative of the appellant company argued that they were transporting the goods on F.O.R basis where the ownership of the goods lies with them up to the destination and they had bore the risk of damage to the goods during the outward transportation to the destination and freight charges were an integral part of the price of the goods.

5. Shri N. Jagdish, learned A.R. appearing for the respondent viz. Commissioner of Central Excise, Bangalore-I argued that the appellants were given an opportunity at the stage of first adjudication as well as during appellate stage before the Commissioner (Appeals) but they failed to produce evidence regarding compliance of the necessary conditions which could have made them eligible to claim the Cenvat credit of service tax paid on outward freight charges.

6. After considering the facts of the case, submissions of both the sides and the decisions of the Honble High Court in the case of Commissioner of Central Excise & Service Tax, LTU, Bangalore Vs. ABB Limited [2011 (23) S.T.R. 97 (Kar.)], the matter is remanded back to the original adjudicating authority for de novo adjudication, the original adjudicating authority will give the appellants sufficient opportunity of providing necessary evidence in the form of documents showing compliance of the conditions mentioned in the Boards Circular No. 97/8/2007-S.T. dated 23.8.2007 to claim Cenvat credit of service tax paid on outward freight charges. The original adjudicating authority is directed to decide the matter afresh within a period of 3 months from the date of receipt of this order.

7. It has also been pointed out by the learned A.R. that there is one more appeal (ST/428/2009) by the very same appellant on the same issue against the same Order-in-Appeal. All the three appeals are being disposed of by this common order by way of remand in the above terms.

(Pronounced in open court)

(ASHOK K. ARYA) MEMBER (TECHNICAL) /vc /