2014 (7) TMI 234 - AT - Central Excise

Denial of CENVAT Credit - Cenvat credit was denied to the respondent by the original adjudicating authority on the ground that same has been availed on various items used for manufacturing the supporting structures, ladders, platform and fabrication of storage tanks and cannot be considered to be an eligible cenvatable items - Held that - Show cause notice was issued to the appellants on 24.2.2012 for the period August, 2008 to April, 2009. During the relevant period, various decisions of the Tribunal were in favour of the assessee and the law was reversed only subsequently by the Larger Bench in the case of Vandana Global Ltd 2010 (4) TMI 133 - CESTAT, NEW DELHI (LB) - Tribunal in a number of other appellants similar situate has taken a view that when decisions of the Higher appellate authorities, during the relevant period, were in favour of the assessee, no malafide can be attributed to the assessee so as to invoke the longer period of limitation. Apart from the fact that the credit was being availed by reflecting the same in their statutory records, in which case again no malafide can be attributed on the part of the respondents so as to justifiably invoke the longer period of limitation - demand is beyond the period of limitation - Decided against Revenue.

Summary

Issues: Denial of Cenvat credit, Period of limitation for appeal

The judgment addresses the denial of Cenvat credit amounting to Rs. 5,41,846 to the respondent by the original adjudicating authority. The denial was based on the grounds that the credit was availed on items used for manufacturing supporting structures, ladders, platforms, and fabrication of storage tanks, which were deemed ineligible as Cenvatable items. The Tribunal found that during the relevant period, various decisions favored the assessee, and the law was reversed only later by the Larger Bench in the case of Vandana Global Ltd. The Tribunal cited several decisions to support the view that when higher appellate authorities' decisions were in favor of the assessee, no malafide could be attributed to the assessee to invoke a longer period of limitation. The Tribunal noted that the credit was reflected in the statutory records, indicating no malafide intent on the part of the respondents to warrant the longer period of limitation. Consequently, the Tribunal rejected the Revenue's appeal as the entire demand was beyond the period of limitation, finding no merits in the appeal.

This judgment highlights the importance of considering the period of limitation in appeals concerning Cenvat credit denial. It underscores the significance of the legal precedents and decisions favoring the assessee during the relevant period, which can impact the attribution of malafide intent and the applicability of a longer period of limitation. The judgment emphasizes the need to assess the circumstances surrounding the availing of credits and the reflection of such transactions in statutory records to determine the presence or absence of malafide intentions. By referencing various legal decisions, the Tribunal establishes a framework for evaluating appeals related to Cenvat credit denials and the implications of the limitation period on such cases. Overall, the judgment provides a nuanced analysis of the interplay between legal precedents, malafide attributions, and the period of limitation in the context of Cenvat credit disputes, offering clarity on the factors influencing the outcomes of such appeals.