2018 (5) TMI 19 - AT - Central Excise

Whether the extended period of limitation could be applicable for recovery of the cenvat credit of ₹ 5,16,913/- for availing inadmissible credit on Education Cess and Secondary & Higher Education Cess during the period October 2012 to July 2013? Held that - even though the entire credit was reversed by them on 31.08.2013, the demand notice was issued on 22.12.2016 involving extended period - the demand is issued invoking extended period of limitation, therefore, the same cannot be sustainable - appeal allowed on limitation.

Summary

Issues involved:
1. Applicability of extended period of limitation for recovery of cenvat credit on Education Cess and Secondary & Higher Education Cess during a specific period.

Analysis:

Issue 1: Applicability of extended period of limitation
The appeal was filed against an order passed by the Commissioner (Appeals) Central Excise, Ahmedabad, regarding the recovery of cenvat credit of ?5,16,913 for availing inadmissible credit on Education Cess and Secondary & Higher Education Cess between October 2012 to July 2013. The appellant argued that the demand notice issued on 22.12.2016, involving the extended period of limitation, was barred by limitation as the credit had already been reversed by them on 31.08.2013. The Revenue, however, supported the findings of the Commissioner (Appeals). The Tribunal found that the issue involved a pure question of interpretation of law and the demand notices were issued within the normal period of limitation. Therefore, the imposition of penalty on the assesses was deemed unwarranted and set aside. Since the demand in the present case was issued invoking the extended period of limitation, the Tribunal held that it could not be sustainable. Consequently, the impugned order was set aside, and the appeal was allowed on the grounds of limitation.

This judgment highlights the importance of the period of limitation in tax matters and how the applicability of an extended period can impact the validity of a demand notice. It also emphasizes the significance of interpreting tax laws correctly and the implications it can have on penalties imposed on assesses. The decision underscores the need for a thorough understanding of legal provisions and their application in tax disputes to ensure fair and just outcomes.