2015 (11) TMI 1335 - AT - Central Excise

Rectification of mistake - Held that - Tribunal had given the detailed finding for nonapplicability of the case laws as cited by the Appellant. It has also followed the decision of the Larger Bench of the Tribunal in the case of Spenta International Ltd (2007 (8) TMI 25 - CESTAT, MUMBAI) - Tribunal, after considering the facts of the case, had come to a conclusion that the Applicant used the capital goods for manufacturing the exempted finished goods. This is supported by the statement of Shri Nalin Desai, Chief Manager of the Applicant. - factual dispute on use of capital goods and non-consideration of the case laws as relied upon by the Applicant and follow the decision of the Larger Bench of the Tribunal, are debatable issues and therefore, it cannot be a mistake apparent on the face of records. It is well settled that the Tribunal is not empowered to review/recall its earlier order and substituting the same by a different order. - No merit in appeal filed - Decided against Assessee.

Issues involved:
Rectification of mistake in the Final Order regarding the utilization of capital goods in the manufacture of exempted goods, interpretation of relevant case laws, applicability of the larger period of limitation, mis-declaration by the assessee, reliance on the decision of the Hon'ble High Court, and the rejection of the rectification application.

Analysis:

1. Rectification of Mistake in Final Order:
The Applicant sought rectification of a mistake in the Final Order regarding the utilization of capital goods in the manufacture of exempted goods. The Applicant argued that the Tribunal wrongly observed the use of capital goods in the production of exempted final products. The Applicant contended that the capital goods were utilized in the manufacture of dutiable final products after availing CENVAT Credit. The Tribunal's findings were challenged based on factual inaccuracies and misinterpretation of case laws, including the decision of the Hon'ble Karnataka High Court and the judgment of the Larger Bench in the case of Spenta International Ltd.

2. Interpretation of Case Laws:
The Tribunal analyzed the applicability of case laws, particularly focusing on the interpretation of Notification No.4/1997-CE and Rule 6(4) of the CENVAT Credit Rules, 2004. The Applicant relied on various judgments to support their argument, including the decision of the Hon'ble High Court in a specific case. However, the Tribunal found that none of the cited case laws supported the Applicant's contention. The Tribunal also referenced the decision of the Larger Bench in the case of Spenta International Ltd to determine the eligibility of CENVAT Credit concerning the dutiability of the final product at the time of receiving capital goods.

3. Applicability of Larger Period of Limitation:
The issue of the applicability of the larger period of limitation was raised, with the Applicant contending that the entire demand was time-barred. The Tribunal examined the declaration filed by the assessee regarding the use of capital goods and concluded that there was a mis-declaration to evade duty payment. The Tribunal held that the extended period of limitation was applicable due to the deliberate misrepresentation of facts by the assessee.

4. Mis-Declaration by the Assessee:
The Tribunal highlighted the mis-declaration by the assessee regarding the use of capital goods exclusively in the manufacture of exempted goods. The statement of Shri Nalin Desai, Chief Manager of the Applicant, was cited as evidence, indicating discrepancies between the declaration filed and the actual utilization of capital goods. The mis-declaration played a crucial role in the Tribunal's decision regarding the eligibility of CENVAT Credit and the imposition of the extended period of limitation.

5. Reliance on Hon'ble High Court Decision:
The Applicant relied on a specific decision of the Hon'ble High Court to support their argument regarding the utilization of capital goods and the eligibility for CENVAT Credit. However, the Tribunal found that the cited judgment did not align with the facts of the case and did not provide a legal basis for the Applicant's contentions. The Tribunal emphasized the importance of factual accuracy and adherence to statutory provisions in determining the eligibility for tax credits.

6. Rejection of Rectification Application:
After a detailed analysis of the arguments presented by both parties and a review of the relevant records, the Tribunal rejected the Applicant's application for rectification of mistake. The Tribunal concluded that there was no merit in the rectification request, emphasizing that the issues raised were debatable and not considered as mistakes apparent on the face of the records. The Tribunal also clarified that it did not have the authority to review or recall its earlier order based on differing interpretations of the law.

In conclusion, the Tribunal's judgment addressed various complex legal issues related to the utilization of capital goods, interpretation of case laws, mis-declaration by the assessee, and the applicability of the larger period of limitation. The decision underscored the importance of factual accuracy, adherence to statutory provisions, and the limitations on the Tribunal's authority to review its previous orders.

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