2013 (1) TMI 614 - AT - Central Excise

Expenses giving rise to the aggregate cenvat credit of Rs.1,53,710/- - Held that - The pollution Control Board has required appellant to maintain a green belt of adequate width and density for its premises. As a result of that the expenses are incurred. He supports his argument relying on the letter dated 24th June, 2004 issued by Ministry of Environment & Forest. The submission of appellant appears to have sound reason and that needs to be tested threadbare. Without summary disposal both the authority below did not make any effort to examine each and every element of the constituents aggregating to Rs.1,53,710/- to reach to a rational conclusion therefore, matter is remanded to Adjudicating authority to consider grievance of the appellant in the light of letter of Ministry of Environment and Forest and each and every elements of the constituent of cenvat credit aggregating to Rs.1,53,710/- is to be tested in accordance with law.

Summary

Issues involved:
1. Lack of detailed examination of expenses leading to cenvat credit.
2. Failure to consider the impact of environmental regulations on expenses.
3. Summary disposal of proceedings without thorough analysis.
4. Remand of the case for re-examination of expenses and granting a full opportunity for defense.
5. Remand of related case for de-novo adjudication.

Analysis:
The judgment addresses the issue of inadequate examination of expenses resulting in cenvat credit. It notes that neither the show cause notice nor the adjudication order delved into the various expenses contributing to the aggregate cenvat credit of Rs.1,53,710, highlighting a lack of detailed scrutiny. The court emphasizes the need for a thorough assessment, pointing out that the proceedings were concluded summarily without a comprehensive analysis.

Furthermore, the judgment considers the impact of environmental regulations on expenses incurred by the appellant. It mentions that the Pollution Control Board mandated the maintenance of a green belt on the premises, leading to additional costs. The court acknowledges the validity of the appellant's argument supported by a letter from the Ministry of Environment & Forest, indicating the necessity to investigate this aspect further to arrive at a well-founded decision.

The court criticizes the authorities for their failure to conduct a detailed examination of each constituent element contributing to the cenvat credit. It highlights the importance of scrutinizing every component totaling Rs.1,53,710 to arrive at a reasoned conclusion, emphasizing the need for a more thorough and lawful assessment.

As a result, the judgment remands the matter to the adjudicating authority for a reevaluation in light of the Ministry's letter and a comprehensive analysis of each expense element. It ensures that the appellant is granted a full opportunity to present its defense and receive a fair hearing, underscoring the importance of due process and thorough consideration in reaching a decision.

Additionally, the judgment orders the de-novo adjudication of the case involving Shri V.M. Tiwari, along with the main case of India Glycols Ltd., indicating a broader scope of re-examination and fair treatment across related matters.

In conclusion, both appeals are disposed of in the aforementioned terms, emphasizing the need for a more detailed and comprehensive assessment of expenses, adherence to environmental regulations, and the provision of a full opportunity for defense in the adjudication process.