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CENVAT credit of Service tax can be availed on CHA services engaged by the appellant for export of its products.
Facts:
? The appellants engaged services of Clearing House Agent (CHA) for export of their goods. They were disallowed availment of CENVAT credit of Service tax paid on services rendered by CHA on the ground that the said service does not fall under the category of ‘input service’ and that the service does not relate to ‘business activities’. CHA services are rendered beyond the place of removal.
? Relying on the case of CCE, Nagpur v. UltraTech Cement Ltd., [2010 (20) STR 577 (Bom.)], the appellants inter alia contended that Service tax paid on services required for the activities relating to business could not be denied CENVAT credit. In the case of Rolex Rings (P) Ltd. 2008 (230) ELT 569 (Tri.), it was held that CHA and surveyors’ services are utilised at the time of export of goods and it could be concluded that the place of removal in case of exported goods is the port area. The ownership of the goods remains with the seller till the port area, it can be safely held that all the services availed by the exporter till the port area are required to be considered as ‘input service’ inasmuch as the same are clearly related to the business activities. Activities relating to business are covered by the definition of input service and admittedly CHA and surveyors services are relating to the export business.
Held:
The issue involved in the case is settled in many decisions which followed the decision in the case of Rolex Rings P. Ltd. (supra). Further, the judgment in the case of UltraTech Cement (supra) squarely covers the issue. Where the sale takes place at the destination point and the ownership of the goods remains with the seller till the delivery of the goods, the place of removal would get extended to the destination point and the credit of Service tax paid on the transportation up to such place of sale would be admissible. The Commissioner (Appeals) went beyond the scope of show-cause notice while concluding that some goods exported by the assessee were exempted goods and the appellants could not have availed CENVAT credit on the activities relating to such goods. Thus, the appeal was allowed.
