2018 (3) TMI 825 - AT - Central Excise

CENVAT credit - molasses which has been used for manufacturing of rectify spirit which was ultimately used for manufacture of Indian Made Foreign Liquor (IMFL) - classification declaration under Rule 173-B of the Central Excise Rule, 1944 - Held that - there was no stay order for implementation to said Final Order dated 07.12.2001 and, therefore, the said Order-in-Original dated 06.01.2003 was sustainable. - appeal dismissed - decided against Revenue.

Summary

Issues:
Appeal arising from Order-in-Appeal dated 25.10.2011 challenging demand confirmation under Rule 57(i) of Central Excise Rules, 1944 due to non-acceptance of Final Order dated 07.12.2001 by Revenue and pending Reference Application before Hon'ble High Court of Allahabad.

Analysis:

The appeal before the Appellate Tribunal CESTAT, Allahabad stemmed from an Order-in-Appeal dated 25.10.2011, which confirmed a demand of ?39,33,935 under Rule 57(i) of the Central Excise Rules, 1944. The respondents, engaged in manufacturing sugar and rectified spirit for country liquor, were availing Modvat Credit. The Revenue contested the Order-in-Appeal, citing non-acceptance of the Final Order dated 07.12.2001, with a Reference Application pending before the Hon'ble High Court of Allahabad. The Commissioner (Appeals) upheld the demand, stating no stay order was in place for the Final Order. Consequently, the Revenue appealed to the Tribunal.

During the proceedings, the Revenue reiterated their objection to the Final Order dated 07.12.2001, emphasizing the pending Reference Application before the High Court. The respondent's representative pointed out that the Reference Application had been dismissed by the Hon'ble Allahabad High Court in Central Excise Reference No. 01/2002 on 09.01.2017, rendering the Revenue's grounds for appeal invalid. After considering both sides' arguments and reviewing the High Court's order, the Tribunal concluded that the Revenue's appeal lacked merit. Consequently, the Tribunal dismissed the Revenue's appeal, affirming the decision of the Commissioner (Appeals) and upholding the demand confirmation under Rule 57(i) of the Central Excise Rules, 1944.

In summary, the Tribunal's judgment clarified that the lack of acceptance of the Final Order dated 07.12.2001 by the Revenue, along with the subsequent dismissal of the Reference Application by the High Court, did not provide sufficient grounds to overturn the Order-in-Appeal confirming the demand. The decision highlighted the importance of legal procedures and the impact of court rulings on the validity of appeals in excise matters, ultimately leading to the dismissal of the Revenue's appeal.