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2019 (12) TMI 807 - AT - Central ExciseCENVAT Credit - As per Revenue, since the repair of transformer does not amount to manufacture, the appellants were not entitled to avail the credit of duty paid on the transformer oil used for repair purposes - HELD THAT - Admittedly the present order stands passed in the second round of litigation. When earlier the matter has travelled up to Tribunal and Tribunal in ACCURATE TRANSFORMERS LTD. VERSUS COMMISSIONER OF C. EX., GHAZIABAD 2015 (12) TMI 66 - CESTAT NEW DELHI had held that inasmuch as there was no proposal in the show cause notice for confirming and appropriating the already reversed cenvat credit, the same cannot be confirmed. As such, we fully agree with the Commissioner (Appeals) that confirmation of the same in remand proceedings was not appropriate. Similarly as regards the second issue, it is noted that whatever duty was payable by the appellant was available as credit to their sister unit in which case extended period of limitation cannot be invoked as rightly held by Commissioner (Appeals) - Similarly the issue of availment of credit on the basis of the invoices which was not signed by the Authorized Signatory was already held by the Tribunal as rectifiable defect and not resulting in denial of cenvat credit to the assessee. Appeal dismissed - decided against Revenue.
Issues:
1. Entitlement to cenvat credit on duty paid for repair of transformer. 2. Confirmation and appropriation of reversed cenvat credit. 3. Imposition of penalty on unauthorized invoices. 4. Demand under Valuation Rules. 5. Imposition of interest and penalty. 6. Penalty on managing director for irregular cenvat credit utilization. 7. Inputs not received back from job worker within 180 days. 8. Denial of credit on unsigned invoices. Analysis: 1. The case involved the question of whether the assessee was entitled to cenvat credit on duty paid for the repair of transformers alongside manufacturing activities. The Revenue contended that repair did not amount to manufacture, thus credit was not permissible. The CESTAT previously held that if there was no proposal in the show cause notice to confirm and appropriate the reversed cenvat credit, such confirmation would be against the law. 2. The issue of confirmation and appropriation of reversed cenvat credit was raised, where the Commissioner (Appeals) set aside the demand as the proposal was not included in the show cause notice, aligning with the CESTAT's previous ruling. The extended period of limitation was deemed inapplicable due to the absence of deliberate wrongdoing by the appellant. 3. Regarding the imposition of penalty on unauthorized invoices, the CESTAT had already ruled that the defect was rectifiable, and denial of credit was unwarranted in the absence of evidence of non-receipt of inputs. The adjudicating authority's decision to impose penalties on this matter was considered erroneous. 4. The demand under Valuation Rules was challenged by the appellant, asserting that the duty payable was revenue-neutral as it would be creditable to the sister unit. The Commissioner (Appeals) agreed that the extended period of limitation was not applicable in the absence of intent to evade duty, as per precedent. 5. The imposition of interest and penalty was reviewed in light of the above issues and set aside where the demand itself was nullified. 6. A penalty was imposed on the managing director for alleged involvement in utilizing irregular cenvat credit, which was deemed unjustified given the CESTAT's previous decision in favor of the appellant. 7. The issue of inputs not being returned from the job worker within 180 days had already been decided in favor of the appellant by the CESTAT, making the subsequent imposition of penalties unwarranted. 8. Denial of credit on unsigned invoices was challenged, and the Tribunal had previously held that this was a rectifiable defect, leading to the confirmation of the demand being set aside. The adjudicating authority's decision to reconsider this matter and impose penalties was deemed inappropriate and against judicial discipline.
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