TATA MOTORS LTD. Vs. COMMISSIONER OF CENTRAL EXCISE

JUDGEMENT

(1.) THERE are two appeals and two stay petitions directed against Orders -in -Original Nos. 36/RKS/CEX/P -I/2012, dated 6 -11 -2012 and 39/RKS/CEX/P -I/2012, dated 3 -12 -2012 passed by the Commissioner of Central Excise, Pune -I. In these orders, Cenvat credit of service tax paid on outward freight services amounting to Rs. 1,89,85,296/ - for the period January 2010 to June 2011 and Rs. 84,03,102/ - for the period July 2011 to March, 2012 have been denied and the credits wrongly availed have been sought to be recovered along with interest under the provisions of Rule 14 of the Cenvat Credit Rules, 2004 read with Section 11A of the Central Excise Act, 1944 along with interest thereon and also imposing penalties under the provisions of Rule 15 of the said Cenvat Credit Rules. As the issues involved in both these appeals are common, they are taken up together for consideration and disposal. The appellant, M/s. Tata Motors Ltd., Spare Parts Division, Chakan, Pune, are manufacturers of motor vehicle parts falling under Chapter 87 of the Central Excise Tariff and are discharging excise duty liability on the said goods on the basis of Maximum Retail Price (MRP in short) as envisaged under Section 4A of the Central Excise Act, 1944. The said MRP includes outward freight charges amongst others. Since as per the Rule 2(1) of the Cenvat Credit Rules, 2004, input service includes outward freight only up to the place of removal and the place of removal is the factory, the department was of the view that the appellant is not eligible for the credit of service tax paid on outward freight incurred beyond the place of removal and accordingly sought to deny the credit availed by the appellant on such outward freight by issuing notices dated 23 -1 -2012 and 30 -7 -2012. The said notices were adjudicated vide the impugned orders and the demands were confirmed by denying the Cenvat credit along with interest and imposing penalties. Aggrieved of the same, the appellant is before us.

(2.) THE ld. Counsel for the appellant makes the following submissions: - -