9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2019 (2) TMI 408 - AT - Central ExciseCENVAT Credit - inputs - pipeline fabrication work - EOU crane - electrical installation - earthing connection - insulation of acid plant etc. - Held that - CESTAT Larger Bench decision in the case of Manglam Cement Ltd. Vs. Commissioner of Central Excise, Jaipur 2018 (3) TMI 1547 - CESTAT NEW DELHI has given a finding that steel items used for fabrication of support structure for smooth erection of machine including cement had to be considered as assessories of capital goods and those items are inputs and eligible to get benefit of CENVAT credit as they fall within the scope and ambit of both Rules 2(a)(A) as well as 2(K) of CENVAT Credit Rules, 2004, it can t be said that those credits are inadmissible. As found from the nature of services electric installation, preparation of earthing system for electricity and insulation of acid container should be regard as safety measure for protection of factory and its workers who are engaged in or in relation to the manufacturing process, the same cannot be consider as civil construction or support structure. Extended period of limitation - Held that - It cannot be said that only because audit party had found some credit availed as inadmissible, suppression of fact is made out. Further it is not established that appellant had any malafide intention to suppress its duty liability from the department - extended period cannot be invoked. Appeal allowed - decided in favor of appellant.
Issues:
Inadmissibility of CENVAT credit on various inputs, interest, and penalty imposition challenged. Analysis: 1. The appellant contested the denial of CENVAT credit on inputs like pipeline fabrication work, EOU crane, electrical installation, earthing connection, and insulation of acid plant, along with interest and penalty. The appellant, a manufacturer, had availed credit in accordance with CENVAT Credit Rules, 2004. An audit identified an amount as inadmissible credit, which the appellant reversed partially without utilization. The appellant disputed the remaining credit availed on specific services, leading to a show-cause notice and subsequent Tribunal adjudication. 2. The appellant's counsel argued that the services in question were essential for manufacturing final products and thus eligible for CENVAT credit under Rule 2(l) of the CENVAT Credit Rules, 2004. The counsel cited legal precedents to challenge the invocation of the extended period without deliberate suppression of facts. Additionally, the imposition of penalty and interest was contested based on the unutilized credit balance exceeding the reversed credit, supported by various legal decisions. 3. The department's representative, although not filing a cross-objection, argued for penalty imposition based on legal precedents and supported the Commissioner (Appeals)'s order, advocating against interference by the Tribunal. 4. After hearing both sides and reviewing the case records and legal arguments presented, the Tribunal found that the appellant had challenged the inadmissibility of CENVAT credit on specific services. The Tribunal noted that the appellant's admission during an Exit Interview was construed as an extra-judicial confession, leading to suspicions by the Departmental Authorities. However, based on factual evidence and legal precedent, the Tribunal concluded that the challenged credits were admissible, especially considering the nature of the services provided. 5. The Tribunal analyzed the audit procedures, emphasizing that the audit process aims to ensure tax compliance and discuss matters with the assessee for correct procedures. The Tribunal highlighted that the audit findings did not establish malafide intention on the appellant's part to suppress duty liability. Consequently, the Tribunal allowed the appeal and set aside the Commissioner (Appeals)'s order dated 08.02.2018. In conclusion, the Tribunal's judgment favored the appellant, allowing the appeal and overturning the Commissioner (Appeals)'s decision regarding the inadmissibility of CENVAT credit on specific inputs, interest, and penalty imposition. The detailed analysis considered legal arguments, factual evidence, audit procedures, and legal precedents to arrive at the decision.
|
