2017 (9) TMI 214 - AT - Central Excise

Withdrawal of appeal - Manufacture - CENVAT credit - Held that - when the Revenue wants to add the value of all the bought out items into whole value of the plant on which they asked duty, the assessee is entitled to take cenvat credit of duty paid on the bought out items. If the same is taken into consideration, the duty liability works out of ₹ 59,227,511/- whereas, the cenvat credit is available to the assessee is ₹ 62,790,745/- which is more than the duty demand. In that circumstance, we note that as it is a Revenue neutral situation - assessee s appeal is dismissed as withdrawn and the Revenue s appeal is dismissed on merits.

Summary

Issues:
1. Challenge of impugned order on merits by assessee and Revenue.
2. Whether the activity undertaken by the assessee amounts to manufacture.
3. Entitlement of the assessee to avail cenvat credit on bought out items.
4. Refund of excess credit available to the assessee.
5. Benefit of cum duty price on items.
6. Duty liability calculation and cenvat credit availability.
7. Merits of Revenue's appeal.

Analysis:
The judgment by the Appellate Tribunal CESTAT CHANDIGARH involved appeals by both the assessee and the Revenue against the impugned order. The assessee challenged the order on merits, while the Revenue raised various grounds for appeal. The assessee, engaged in manufacturing and clearing portable crushing and screening plants, argued that their activity did not amount to manufacture, as they manufactured base parts at their factory and carried out installation and commissioning at the site. The assessee claimed entitlement to cenvat credit on bought out items sent directly to the site. The Tribunal considered the duty liability calculation and found that the cenvat credit available to the assessee exceeded the duty demand, resulting in a revenue-neutral situation. The Tribunal noted that the assessee did not seek a refund of the excess credit.

Regarding the benefit of cum duty price on items, the adjudicating authority had already granted this benefit to the assessee. The Tribunal held that the Revenue's appeal lacked merit, as the duty liability was lower than the cenvat credit available to the assessee, and no refund claim was made by the assessee. Consequently, the Tribunal dismissed the Revenue's appeal. The assessee's appeal was also dismissed as withdrawn, as per their request during the proceedings. The judgment highlighted the importance of cenvat credit availability in determining duty liability and emphasized the need for a balanced approach in tax matters.