Port will be considered as place of removal in cases of Export
The Gujarat High Court in the case of Central Excise v Inductotherm India P. Ltd. 2014 (36) STR 994 (Guj.) has held that Cenvat credit in respect of input services availed under the category of Cargo Handling Services is allowed as the same is inclusive in the definition of ‘input service’.
In the present case, the Appellant is engaged in manufacturing of Induction Melting and Heating Furnace, Induction Welding equipment’s and Spare parts which are classifiable under Chapter Heading 8514, 8515 and 8454 of the Schedule to the Central Excise Tariff Act, 1985 and is availing the cargo handling services for the clearance of final product from the port for the purpose of export under Cenvat Credit Rules, 2004.
The High Court held that in the present case ‘input service’ has to be interpreted in light of the requirement of business and cannot be read restrictively so as to confine ‘place of removal’ only up to the factory gate or only up to depot of manufacturers and accordingly any services availed by the exporters until the goods left India from the port are the services used in relation to clearance of final products up to place of removal.
Therefore, Cenvat credit of cargo handling services will be allowed as the same has been utilized for the purpose of export where the place of removal will be considered to be the port.