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2020 (3) TMI 1413 - HC - Central ExciseValidity of circular No.1027/15/2016-CX MANU/EXCR/0016/2016 - reversal of CENVAT Credit - Bagasse - non excisable good or not - HELD THAT - The petitioner states that this very circular was challenged in the Allahabad High Court and by the judgment M/S BALRAMPUR CHINI MILLS LTD. THROUGH ITS GENERAL MANAGER VERSUS UNION OF INDIA MINISTRY OF FINANCE DEPARTMENT OF REVENUE 2019 (5) TMI 972 - ALLAHABAD HIGH COURT Allahabad High Court set aside this circular and this judgment has been permitted to become final. In this view of the matter and in view of the categoric statement made by the learned counsel for the petitioner we allow this writ petition in the same terms as the above judgment with liberty to the Revenue to file an application for review in case the assertion regarding the judgment having been permitted to become final is not correct. However it is clarified that once the circular has been set aside the show cause notice based on the impugned circular is also automatically set aside. Petition stands allowed.
Issues: Challenge to circular reversing CENVAT credit related to Bagasse
Analysis: The petitioner challenged circular No.1027/15/2016-CX issued by the Central Board of Excise and Customs, seeking to reverse the CENVAT credit related to Bagasse by treating it as a non-excisable good for the purpose of credit reversal under Rule 6 of the CENVAT Credit Rules, 2004. The petitioner's counsel pointed out that a similar circular was challenged in the Allahabad High Court, and in a judgment dated 12.04.2019 in the case of Balrampur Chini Mills Ltd. Vs. Union of India, the circular was set aside. The counsel for the respondents acknowledged this fact but expressed uncertainty about the finality of the judgment. Considering the factual assertion and the previous judgment setting aside the circular, the High Court allowed the writ petition in line with the earlier judgment. The Revenue was granted liberty to file a review application if the claim about the finality of the judgment was incorrect. It was clarified that setting aside the circular also automatically nullified any show cause notice based on the impugned circular. With the petition allowed, any pending civil miscellaneous application related to the case was also disposed of. The judgment effectively upheld the challenge to the circular reversing CENVAT credit concerning Bagasse, aligning with the previous decision of the Allahabad High Court.
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