2018 (4) TMI 1014 - AT - Central Excise

CENVAT credit - Diesel Hydraulic Shunting Locomotive - time limitation - Held that - The appellant have availed the credit in the month of June 2013 and thereafter they intimated to the department regarding the availment of credit on locomotive vide their letter dt. 6.8.2013 thereafter some correspondence were taken place between the department and the appellant - it is clear that they have not suppressed any fact as regard availment of credit of the locomotive therefore department should have issued the show cause notice within normal period of 1 year which the department failed to do so - extended period not invokable - appeal allowed - decided in favor of appellant.

Summary

Issues: Time bar on demand of cenvat credit, Admissibility of credit on Diesel Hydraulic Shunting Locomotive

Time Bar on Demand of Cenvat Credit:
The appellant availed cenvat credit on a Diesel Hydraulic Shunting Locomotive in June 2013 and informed the department about it on 6.8.2013. However, the show cause notice was issued on 14.1.2016, which is beyond the normal period of 1 year. The appellant argued that the demand is time-barred as all facts were disclosed to the department within the stipulated time. The appellant cited various judgments to support their claim. The Assistant Commissioner for the Revenue relied on a Tribunal judgment to oppose the appellant's claim. The Tribunal, after considering the submissions, found that the appellant had not concealed any facts regarding the availing of credit on the locomotive. As the show cause notice was issued after the normal period of 1 year, the extended period was not available to the department for demanding cenvat credit. Consequently, the Tribunal set aside the impugned order and allowed the appeal solely on the ground of time bar, without delving into the merits of the case.

Admissibility of Credit on Diesel Hydraulic Shunting Locomotive:
The dispute revolved around the admissibility of cenvat credit on a Diesel Hydraulic Shunting Locomotive. The appellant contended that the demand for cenvat credit was time-barred as all relevant information was disclosed to the department within the prescribed period. The appellant's counsel cited several judgments to support the admissibility of the credit. On the other hand, the Revenue argued against the admissibility of credit based on a Tribunal judgment. The Tribunal, while addressing the issue, focused solely on the time bar aspect of the case. It concluded that since the show cause notice was issued after the normal period of 1 year, the department could not avail of the extended period for demanding cenvat credit. Therefore, the Tribunal ruled in favor of the appellant on the grounds of time bar, without delving into the substantive merits of the case.