2015 (11) TMI 825 - AT - Central Excise

Duty demand - exemption Notification No 2 /2001 dtd 27.1.2001 - Captive consumption - Held that - Tribunal already decided against the 3 show cause notices against the appeal filed by the respondent and remanded the matter. He also submits that the adjudicating authority already dropped the demand in respect of the other 3 show cause notices as per the remand order of the Tribunal. At this stage, the learned Authorised Representative for the Revenue submits 3 months period was not included in the earlier proceedings, which may be verified. Following the decision of the Tribunal in the case of Saurashtra Cement Ltd , we hold that the demand at the rate of 8% of the value of Cement cannot be sustained and remand the matter to the Commissioner for verification of the correctness of the reversal of credit amount. - Appeal disposed of.

Issues:
1. Demand of duty on clinker used in the manufacture of cement under exemption Notification No 2/2001 for earthquake relief work.
2. Verification of reversal of credit amount related to demands under Rule 6 of CENVAT Credit Rules.
3. Demand of duty on clinker for captive consumption.

Analysis:

Issue 1:
The judgment addresses the demand of duty on clinker used in the manufacture of cement under exemption Notification No 2/2001 for earthquake relief work. The Adjudicating authority confirmed the payment of 8% of the total price of cement under Rule 6(3)(b) of CENVAT Credit Rules for 3 Show Cause Notices and dropped the demand of duty on clinker for 2 Show Cause Notices. The Tribunal referred to previous cases involving Saurashtra Cements Ltd and Gujarat Sidhee Cements Ltd, Bhavnagar, where the matter was remanded for verification of the reversal of credit amount. Ultimately, the Tribunal remanded the present case to the Commissioner for verification of the correctness of the reversal of credit amount, leading to the disposal of the appeal.

Issue 2:
Regarding the verification of reversal of credit amount related to demands under Rule 6 of CENVAT Credit Rules, the Learned Advocate for the respondent highlighted that the impugned order pertained to 5 show cause notices, with 3 notices related to demands under Rule 6 and 2 notices concerning duty on clinker for captive consumption. The Tribunal had previously decided against the 3 show cause notices, leading to a remand for verification. The adjudicating authority had already dropped the demand in respect of the other 3 show cause notices based on the Tribunal's remand order. The Tribunal, following the decision in the Saurashtra Cement Ltd case, concluded that the demand at the rate of 8% of the value of cement was unsustainable and remanded the matter for further verification to ensure the correctness of the credit amount reversal.

Issue 3:
The judgment also addressed the demand of duty on clinker for captive consumption. The Tribunal's decision to remand the matter for verification of the reversal of credit amount extended to this issue as well. The adjudicating authority's actions and the Tribunal's previous decisions played a crucial role in the final disposal of the appeal, ensuring a comprehensive review of the correctness of the reversal of credit amount in all relevant aspects.

In conclusion, the judgment thoroughly analyzed and addressed the issues related to the demand of duty on clinker for cement manufacturing and captive consumption, emphasizing the importance of verifying the reversal of credit amounts under the CENVAT Credit Rules. The decision to remand the matter for further verification ensured a just and comprehensive resolution of the appeal.

← Previous Next →