2013 (7) TMI 598 - AT - Central Excise

Limitation Extended period Held that - Before availing the credit, the appellant has addressed letter dated 15.12.2006 to their jurisdiction Deputy Commissioner intimating their intention to avail credit on the inputs used in the manufacture of their capital goods. The credit so availed is also reflected in the statutory record maintained by them as also in the reports so filed by them Also, relying upon the decision of Hon ble Supreme Court decision in the case of Mentha & Allied Products Ltd. Vs. CCE, Meerut 2004 (5) TMI 74 - SUPREME COURT OF INDIA , confirmation of demand is barred by limitation Decided in favor of Assessee.

Summary

Issues: Denial of Cenvat credit on iron and steel items, JE Tow Trucks; Imposition of penalty; Appeal based on limitation

The judgment by Ms. Archana Wadhwa of the Appellate Tribunal CESTAT New Delhi dealt with the denial of Cenvat credit to the appellants on iron and steel items used in the manufacture of S.S. cold Rolled Patta falling under chapter 72 of the Central Excise Tariff Act, 1985, and on JE Tow Trucks. The denial of credit in appeal No. E/128/11 amounting to Rs. 88,468/ and in appeal No. E/129/11 amounting to Rs. 378,578/ was based on the grounds that the items availed were not cenvatable goods. Penalties of identical amounts were imposed in both cases.

The appellant argued that the iron and steel items were used in the fabrication of capital goods, making them admissible inputs for Cenvat credit. Similarly, regarding the JE Tow Trucks, it was contended that since they were used for the movement of goods within the factory, they qualified as admissible cenvatable items. The appellant also raised the issue of the demand being time-barred.

Ms. Archana Wadhwa found that the appeal could be disposed of based on the limitation issue alone. The show cause notice was issued invoking a longer period of limitation. The appellant had informed the jurisdiction Deputy Commissioner of their intention to avail credit on inputs used in manufacturing capital goods before actually availing the credit. The credit availed was duly recorded in statutory records and reports. The existence of conflicting decisions by the Tribunal and various High Courts regarding the admissibility of such credit meant that suppression could not be attributed to the assessee to justify invoking a longer limitation period. Reference was made to the Supreme Court decision in the case of Mentha & Allied Products Ltd. vs. CCE, Meerut 2004 (167) ELT 494 (S.C.).

Consequently, Ms. Archana Wadhwa set aside the impugned order confirming the demands, ruling that the demands were barred by limitation. Both appeals were allowed, providing consequential relief to the appellant. The judgment was pronounced in open court on 01.07.2013.