9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2013 (10) TMI 1320 - AT - Central ExciseUtilization of CENVAT Credit - Notification No. 13/2003-C.E. (N.T.), dated 1-3-2003 - Interest u/s 11AB - Held that - Though as per the Explanation, it has been provided that additional duty of excise leviable under Section 3 of the ADE (GSI) Act, 1957 and paid on or after 1-4-2000, may be utilized towards payment of duty of excise leviable under the First Schedule or the Second Schedule to the Central Excise Tariff Act, 1985, as per Section 88 of the Finance Act, 2004, the date of effect of the amendment is from 1-3-2003 and the said Section clearly mentions that the explanation shall stand amended and shall be deemed to have been amended retrospectively in the manner as specified in the Second Schedule, on and from the corresponding date mentioned in column (3) of the Schedule. From this, it is evident that the amendment is effective from the date mentioned in the column (3) of the Second Schedule to the Finance Act, 2004 and the date mentioned is 1-3-2003. If that be so, the utilization of credit is permitted only w.e.f. 1-3-2003 and not prior to that date even though the credit might have accumulated on or after 1-4-2000. - Appellant would be liable to pay interest on the advance utilization of credit - Decided in favour of assessee.
Issues:
Interpretation of Cenvat Credit Rules regarding the utilization of credit under Additional Duties of Excise (Goods of Special Importance) Act, 1957 before and after the amendment. Analysis: The appeal in this case was against an Order-in-Original passed by the Commissioner of Central Excise, Mumbai-III, concerning the denial of Cenvat credit utilized by the appellant, a company named M/s. Raymond Apparel Ltd., towards payment of Basic Excise Duty (BED) on goods manufactured by them. The department contended that the appellant could only utilize the credit after a specific amendment to the Cenvat Credit Rules, which was effective from 1-3-2003. The appellant argued that as per the Explanation to the Rules, they were eligible to utilize the credit on or after 1-4-2000, thus justifying their utilization in February 2003. The appellant's counsel further submitted that even if the credit could only be utilized after 1-3-2003, the appellant should only be liable for interest on the advance utilization of credit for the period from 19-2-2003 to 28-2-2003, not the entire credit amount. The Revenue's representative acknowledged that the appellant had sufficient credit balance, making the utilization an advance, and agreed that interest should be the only liability on the appellant for this advance utilization. The Tribunal analyzed the contentions of both parties and noted that while the Rules allowed for utilization of credit paid under the ADE (GSI) Act from a certain date, the retrospective amendment specified the effective date as 1-3-2003. Consequently, the utilization of credit before this date was not permissible. However, the Tribunal agreed with the appellant's argument that the utilization on 19-2-2003 constituted advance utilization, warranting only the payment of interest for the period until 28-2-2003. As the issue revolved around the interpretation of the law, the Tribunal held that no penalty should be imposed on the appellant or its official, setting aside the penalties initially imposed. In conclusion, the Tribunal ruled that the appellant was liable to pay interest on the utilization of credit for a specific period and that the penalties imposed were unjustified. The appeal was disposed of accordingly.
|
