2020 (3) TMI 641 - HC - Central Excise

Imposition of penalty u/r 15(2) of CENVAT Credit Rules, 2004 read with Section 11 AC of the Central Excise Act, 1944 - issue was not free from doubts, when the assessee vide their letter dated 8.7.2005 claimed to have stopped availing Cenvat Credit after insertion of Explanation III in sub-rule6(3) of CENVAT Credit Rules, 2004 w.e.f. 16.5.2005 - HELD THAT - The questions proposed do not arise for consideration. Appeal disposed off.

Summary

Issues:
1. Challenge to the order passed by the Custom, Excise and Service Tax Appellate Tribunal.
2. Substantial questions of law raised by the Commissioner of CGST and Central Excise, Thane Commissionerate.
3. Disposal of an appeal under Section 35G of the Central Excise Act, 1944.
4. Decision against the Revenue in a group of appeals.
5. Confirmation of the invocation of the extended period of limitation despite setting aside the penalty.

Analysis:

1. The High Court of Bombay heard an appeal challenging the order passed by the Custom, Excise and Service Tax Appellate Tribunal dated 6 November 2018. The Commissioner of CGST and Central Excise, Thane Commissionerate raised substantial questions of law regarding the penalty imposed under Rule 15(2) of CENVAT Credit Rules, 2004, and the cessation of availing Cenvat Credit by the assessee. The court considered these questions in detail to determine the correctness of the Tribunal's decision.

2. Another appeal under Section 35G of the Central Excise Act, 1944 was disposed of by the High Court. The appellant raised substantial questions of law related to the exemption of tractors from excise duty, denial of credit, and the applicability of Cenvat Credit Rules, 2004. The court examined whether tractors qualified as exempted goods and if the education cess should be considered as part of the duty of excise. The court also addressed the applicability of Cenvat Credit Rules to the case, considering the specific duties levied on tractors.

3. In a related matter, a decision against the Revenue was mentioned, where questions of law were decided against the Revenue in a previous decision. The court clarified that the questions framed in the current appeal had already been addressed in the previous decision, and hence, did not require reconsideration. The court also considered the issue of the extended period of limitation and the imposition of penalties, ultimately ruling in favor of the appellant due to the decision rendered in their favor on the merits.

4. The judgment highlighted that the questions proposed for consideration did not arise due to the decision in the related matter. Consequently, the court disposed of the appeal based on the findings and rulings made in the previous decisions, emphasizing the resolution of the penalty issue in favor of the appellant. The court's detailed analysis and consideration of the legal aspects involved in the appeals provided clarity on the application of relevant laws and rules in the given circumstances.