2017 (11) TMI 1690 - HC - Central Excise

Input tax credit - Whether the Hon ble Tribunal is correct in deciding the eligibility of input tax credit on LSHFHSD to M/s City Lubricants when LSHF and HSD are different in nature? - Held that - Since the Tribunal has concurred with the view of the Revenue that the respondent-assessee is ineligible for claiming the input tax credit on LSHF-HSD, the said question of law does not arise for consideration in this appeal. time limitation - Penalty - Held that - The Tribunal has set aside the penalty on the ground that for a particular period, there was no misdeclaration by the respondent-assessee, and that the levy of penalty for the subsequent period is barred by limitation - the substantial question of law raised is answered against the Revenue. Appeal dismissed - decided against Revenue.

Summary

Issues Involved:
1. Eligibility of input tax credit on LSHFHSD to M/s City Lubricants
2. Misdeclaration by the assessee and imposition of penalty

Analysis:

Issue 1: Eligibility of input tax credit on LSHFHSD to M/s City Lubricants
The appeal was filed by the Revenue against the order of the Customs, Excise and Service Tax Appellate Tribunal, challenging the eligibility of M/s City Lubricants for claiming input tax credit on LSHF-HSD, which are considered different in nature. The Tribunal concurred with the view of the Revenue that the respondent-assessee was ineligible for the credit. The High Court noted this agreement and concluded that the first substantial question of law did not arise for consideration in the appeal. Therefore, the issue of input tax credit eligibility was not further deliberated upon in the judgment.

Issue 2: Misdeclaration by the assessee and imposition of penalty
The second substantial question of law pertained to the misdeclaration by the assessee and the imposition of penalty. The Tribunal had set aside the penalty, citing that there was no misdeclaration by the respondent-assessee for a specific period and that the penalty imposition for the subsequent period was time-barred. The High Court carefully considered the reasons provided by the Tribunal and found no grounds to differ with the decision. Consequently, the substantial question of law raised against the imposition of penalty was answered against the Revenue, leading to the dismissal of the appeal.

In conclusion, the High Court upheld the Tribunal's decision regarding the eligibility of input tax credit and the imposition of penalty on the respondent-assessee. The judgment provided a detailed analysis of both issues raised in the appeal, ultimately ruling in favor of the respondent and dismissing the appeal filed by the Revenue.