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August 2016

2016 (42) STR 1009 (Tri.-Del.) Ashoka Industries vs. CCE, Jaipur-I

By Puloma Dalal, Jayesh Gogri, Mandar Telang; Chartered Accountants
Reading Time 1 mins
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CENVAT credit on outward transportation and insurance of goods from factory to buyer’s premises shall be eligible if the terms of the contract are “FOR at buyer’s premises”.

Facts
The appellants had availed CENVAT credit on transportation and transit insurance on finished goods from factory to buyer’s premises on the basis that the place of removal was buyer’s premises where the goods were delivered since the terms of the contract were “FOR at buyer’s premises” and the transportation is included in assessable value of finished goods. CENVAT credit was disallowed since as per definition of “input services” transportation “upto the place of removal” was only allowed.

Held :
Since ownership and responsibility of goods were transferred by way of sale to the buyer on delivery at the destination, place of removal was buyer’s premises and therefore, CENVAT credit was allowed.

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