2017 (3) TMI 8 - AT - Central Excise

CENVAT credit - whether the appellant is entitled to the credit of the amount paid by the supplier to the Government? - Held that - the issue is squarely covered in favor of the appellant by the decisions in the case of Kerala State Electronic Corpn. Vs. CCE Kochi 1996 (2) TMI 228 - CEGAT MADRAS wherein it has been held that the appellants under these circumstances is entitled to avail the CENVAT credit of the duty paid by him to the supplier who had further paid same to the Government - appeal allowed - decided in favor of appellants.

Summary

Issues:
- Appeal against rejection of appeal and upholding of Order-in-Original by Commissioner (A).
- Denial of credit by authorities.
- Jurisdiction over factory and credit assessment.
- Nature of Section 11D provisions.
- Amount collected and payment to Government.
- Larger period of limitation invoked.
- Applicability of cited decisions.

Analysis:
The appeal was filed against the Commissioner (A)'s order rejecting the appellant's appeal and upholding the Order-in-Original. The appellant, a textile processing company, had purchased machinery in 2005 and claimed CENVAT credit. The authorities alleged that the machinery was exempt from duty but was still cleared with duty payment by the supplier. The Assistant Commissioner confirmed the demand, interest, and imposed a penalty. The appellant argued that the denial of credit was beyond jurisdiction and contrary to established legal principles. The appellant cited precedents to support their case, emphasizing entitlement to CENVAT credit if duty was paid to the supplier who then paid it to the Government.

The Judicial Member considered submissions, records, and cited judgments. It was noted that the issue was in favor of the appellant based on the cited decisions. The decisions supported the appellant's right to claim CENVAT credit when duty was paid to the supplier who subsequently paid it to the Government. Consequently, the appeal was allowed, setting aside the impugned order with any consequential relief. The operative part of the order was pronounced in open court on 19/12/2016.

In conclusion, the judgment addressed the denial of credit, jurisdictional aspects, interpretation of Section 11D provisions, and applicability of cited decisions. The decision favored the appellant's position, emphasizing the right to claim CENVAT credit under the circumstances described.