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2019 (8) TMI 965 - HC - Central ExciseCENVAT Credit - duty paid on exempted goods - Classification of inputs - Shrink Sleeves received from M/s. Paper Products Pvt. Ltd. - classifiable under Chapter 39 heading 3920.19 of the Tariff Act 1985 or under Chapter 40 heading 4901.90 of the Tariff Act 1985? - HELD THAT - The Tribunal in the case of PAPER PRODUCTS LTD. VERSUS COMMISSIONER OF CENTRAL EXCISE VAPI 2005 (9) TMI 133 - CESTAT MUMBAI held that Shrink Sleeves had been correctly declared by M/s. Paper Products Ltd. as classifiable under Chapter 39 heading 3920.19 of the Tariff Act 1985. Therefore the Shrink Sleeves which were inputs of the Respondents are chargeable to duty and not classifiable under Chapter 40 heading 4001.90 of the Tariff Act to attract Nil rate of duty as urged by the Revenue. In view of the Revenue s appeal to the Supreme Court in COMMISSIONER OF CENTRAL EXCISE VAPI VERSUS M/S. THE PAPER PRODUCTS LTD. 2015 (9) TMI 467 - SUPREME COURT upholding the classification of the inputs under Chapter 39 of the Tariff Act 1985 as claimed by M/s. Paper Products Ltd. and not under Chapter 40 of the Tariff Act 1985 as claimed by the Revenue. Appeal dismissed - decided against Revenue.
Issues:
Challenge to order under Section 35G of the Central Excise Act, 1944 regarding CENVAT Credit on inputs received from a supplier. Analysis: The appeal before the High Court challenged an order passed by the Central Excise, Customs and Service Tax Appellate Tribunal regarding the classification of inputs received by the Respondents from a supplier. The main issue revolved around whether the Tribunal was justified in allowing CENVAT Credit on 'Shrink Sleeves' received from the supplier, who classified the inputs under Chapter 39 of the Central Excise Tariff Act, 1985. The Revenue contended that the inputs should have been classified under Chapter 40, attracting a 'Nil' rate of duty, and thus, the CENVAT Credit taken by the Respondents should be denied. The Tribunal, in its order, relied on a previous decision involving the same supplier where it was held that the 'Shrink Sleeves' were correctly classified under Chapter 39 of the Tariff Act, 1985. Consequently, the Tribunal allowed the Respondent's appeal, affirming that the inputs were chargeable to duty and not classifiable under Chapter 40 as argued by the Revenue. The Revenue, through its counsel, acknowledged that the issue raised in the present case was no longer valid due to a Supreme Court decision upholding the classification of the inputs under Chapter 39, as claimed by the supplier. With the Apex Court's decision, there was no substantial question of law remaining unresolved. As the Revenue did not dispute the CENVAT Credit taken by the Respondents in light of the Supreme Court's ruling, the proposed question did not give rise to any substantial legal issue. Therefore, the High Court dismissed the appeal, concluding that the matter was settled by the Apex Court's decision. In summary, the High Court upheld the Tribunal's decision to allow CENVAT Credit on the inputs received by the Respondents, as the classification under Chapter 39 was deemed correct based on the Supreme Court's ruling. The appeal challenging the Tribunal's order was dismissed, as there was no longer any legal question to be addressed following the Apex Court's decision.
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