[ORDER PER: ANGAD PRASAD]

The present appeal is directed against the impugned Order-in-Original dated 15.01.2013 passed by the Commissioner of Central Excise, Guntur whereby, Cenvat Credit amounting to Rs. 52,44,388/-, availed on clearing and forwarding services during the period from March, 2008 to March, 2011, has been disallowed along with applicability interest. An equivalent penalty has also been imposed under Rule 15(2) of the Cenvat Credit Rules, 2004.

The fact, in brief, is that the appellant is engaged in the manufacture of cement falling under chapter 25 of the Central Excise Tariff Act, 1985. Cement manufactured by the appellant was cleared from factory and also stock-transferred to its depot/warehouses situated in different states. Such depots were managed by clearing and forwarding agents, who undertook, inter alia, receipt of cement from railway stockyards / transporter’s godowns, unloading, storage, handling, loading into transport vehicles and, in certain cases, unloading at the customer’s premises.

The appellant availed Cenvat Credit of the Service Tax paid on the services rendered by such C&F agents. The Department took the view that these services were rendered beyond the factory or depot, which constituted the “place of removal”, and where therefore not covered by the definition of “input service” under Rule 2 (l) of the Cenvat Credit Rules, 2004.

Learned Consultant for the appellant submits that the cement was sold on FOR-destination basis and that the responsibility of the appellant continued until the cement was delivered at the customer’s premises. Therefore, according to the appellant, the customer’s premises constituted the place of removal. It is further submitted that the C&F services were integrally connected with the storage, marketing, sale and delivery of cement and were covered by the expression “activities relating to business”occuring in the definition of input service during the disputed period.

Learned Consultant further submits that the issue is covered by the decisions in madras Cements ltd., Vs Additional Commissioner of Central Excise, Bangalore, 2015 (40) STR 645 (Kar.), Bharat Fritz Warner Ltd., Vs CCE, Bangalore (2022 (66) GSTL 434 (Kar), the Larger Bench decision in the Ramco Cements Ltd., Vs CCE, Puducherry, 2023 (12) TMI 1332 – CESTAT Chennai (LB).

On limitation, it is submitted that the credit had been duly recorded in the statutory records and reflected in the ER-1 returns. The appellant’s records were also subjected to departmental audit in September, 2010 and January, 2012. There was, therefore, no suppression of material facts with intent to evade duty warranting invocation of extended period or imposition of penalty.

Learned Authorized Representative reiterated the findings of the impugned order. It is submitted that after the amendment to Rule 2(l) w.e.f. 01.04.2008, credit is available only in respect of services used “up to the place of removal”. Mere description of sales as FOR-destination sales would not automatically make the buyer’s premises the place of removal. Reliance is placed on the decisions of the Hon’ble Supreme Court in Commissioner Vs Ultra Tech Cement Ltd., 2018 (9) GSTL 337 (SC).

We have heard both the sides and perused the records.

The principal issue is whether C&F services availed at the depot/ware houses and in connection with the delivery of cement of customers classify as input services under Rule 2(l) of the Cenvat Credit Rules, 2004.

In so far as the services rendered within the depot or warehouses are concern, Section 4(3)(C) of the Central Excise Act, 1944 specifically includes a depot, premises of a consignment agent or any other premises from where excisable goods are sold after clearance from the factory, within the expression “place of removal”. Consequently, where cement was stock- transferred to the depots and thereafter sold therefrom, services relating to receipt, unloading, storage, handling and lo