Order Date: 8 August 2022

Facts-

• The Appellant, Shalimar paints Ltd. is having three manufacturing units at Nasik, Sikandrabad and Howrah and Head Office at Kolkata. The Appellant was receiving services of the Goods Transport Agency (in short GTA) at the head office for removal of goods from respective factories to its various depots.
• The department contended that the GTA credit could be availed only upto the place of removal and not from place of removal, the Head Office could not distribute credit without having ISD registration, the credit was to be proportionately distributed to all the units.
• Notices were adjudicated upon by separate orders against which the Appellant filed two appeals before the Tribunal.

Issue-

• Whether the credit on GTA services from the place of removal is admissible and whether the impugned order denying credit on the basis of non- registration of Head Office as ISD is sustainable?

Order-

• The Tribunal observed that the issue is no more res integra on merits itself in the light of judgment of Hon’ble Supreme Court in the case of COMMISSIONER OF CENTRAL EXCISE SERVICE TAX VERSUS ULTRA TECH CEMENT LTD. 2018- SUPREME COURT] where it was held that Cenvat Credit on goods transport agency service availed for transport of goods from place of removal to buyer’s premises was not admissible to the respondent.  Therefore, following the same, it was held that credit on GTA services from the place of removal upto 1.4.2008 was rightly admissible to the Appellant..
• The Tribunal further observed that Rule 7 of CCR provided a mechanism to distribute the credit and it was only after amendment made in 2016, the condition for proportionate distribution was inserted. This issue has also been settled by the Tribunal in the case of PIRAMAL GLASS PVT LTD VERSUS C.C.E. & S.T. -SURAT-I 2021 - CESTAT AHMEDABAD that prior to 1.4.2016 there was no need to proportionately distribute credit to all the units. Therefore, the credit was rightly distributed to the appellant by its Head Office during the period in dispute.
• The issue involved being of general in nature, the law has already been settled by the Hon’ble Gujarat High Court in COMMISSIONER OF CENTRAL EXCISE VERSUS DASHION LTD 2016 - GUJARAT HIGH COURT where it was held that credit cannot be denied on the basis of non-registration of Head Office as ISD - the impugned order denying credit on the basis of non- registration of Head Office as ISD is not sustainable.
• Since the appeals are allowed on merits itself, there otherwise remains no need to look into the issue of limitation.
• Thus the Appeal is allowed and decided in favor of the appellant.