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February 2014

2013-TIOL-1038-HC-KOL-ST Commissioner of Central Excise, Kolkata vs. M/s Vesuvious India Ltd.

By Puloma Dalal, Jayesh Gogri, Mandar Telang, Chartered Accountants
Reading Time 1 mins
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Whether outward transportation of finished goods from place of removal covered under the definition of “input service” before 01-04-2008? Held, No.

Facts:
The revenue preferred appeal against the order of the CESTAT, Kolkata allowing CENVAT credit of the amount paid towards outward transportation of finished goods from the place of removal upto the point of delivery relying solely on the case of Commissioner of C.E & S.T., LTU, Bangalore vs. ABB Limited in 2011 (23) STR 97 (Kar)

Held:
Diagreeing with the judgment of the Hon. Karnataka High Court in ABB Limited (supra), the Hon. Kolkata High Court allowing the appeal of the department held that the definition of “input service” would not include the expenses with regard to post-manufacturing stage except for the purpose of transportation of goods from one place of removal to another place of removal. They further stated that although a Board circular was issued, it cannot be to amend the rules and thus neither the services rendered to the customer for the purpose of delivering the goods at the destination was covered by the definition of input service prior to 01-04-2008 nor is the same covered after 01-04-2008.

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