2015 (5) TMI 137 - HC - Central Excise

Cenvat Credit on capital goods - goods were not used in the captive mines of the assessee - Held that - Tribunal is the final fact finding authority in the hierarchical chain. A perusal of the order under challenge would reveal that the facts, which are relevant for deciding the appeal, have not been discussed at all and as to how the decision of the Supreme Court and the Tribunal are applicable to the facts of the case. No reasons have been recorded by the Tribunal to arrive at the finding. This Court wishes to point out that the Tribunal could have been a little more explicit and clear while allowing the appeal by recording reasons, which are relevant to the case. It is not a case where the Department has conceded that the decisions of the Supreme Court or that of the Tribunal applies to the facts of the case. Such being the case, recording of reasons is of paramount necessity in all judicial and quasi-judicial orders. - Matter remanded back - Decided in favour of Revenue.

Summary

Issues:
1. Extension of credit of duty paid on parts of surface miners used in mines outside factory.
2. Extension of credit of duty paid on CCTVs excluded from definition of capital goods.
3. Extension of 100% credit on goods received under project import after 01.03.1997.

Analysis:

Issue 1:
The appellant challenged the Tribunal's order extending credit of duty paid on parts of surface miners used in mines outside the factory. The appellant argued that the Tribunal did not provide reasons for its decision, making it necessary to set aside the order. The High Court emphasized the importance of recording reasons by fact-finding authorities to enable proper review. The Tribunal's order lacked explicit reasoning and failed to discuss the applicability of Supreme Court and Tribunal decisions to the case. Consequently, the High Court set aside the Tribunal's order and remanded the matter for a detailed and reasoned decision.

Issue 2:
Regarding the extension of credit for duty paid on CCTVs excluded from the definition of capital goods, the appellant contended that the Tribunal's decision lacked proper reasoning and consideration of the facts. The High Court reiterated the necessity of recording reasons in judicial and quasi-judicial orders for clarity and proper review. The Tribunal's order did not address the specific facts raised by the appellant, leading the High Court to set aside the order and remand the matter for a detailed and reasoned decision.

Issue 3:
The dispute over extending 100% credit on goods received under project import after 01.03.1997 was also raised. The appellant argued that the Tribunal failed to provide reasons for its decision, necessitating the order to be set aside. The High Court stressed the significance of recording reasons to support findings, especially in final fact-finding authorities like the Tribunal. Since the Tribunal's order lacked explicit reasoning and discussion on the applicability of legal decisions, the High Court remanded the matter for a detailed and reasoned decision without imposing any costs.