2021 (8) TMI 37 - HC - Central Excise

Maintainability of appeal - monetary limit involved in the appeal - Applicability of circular dated 22.08.2019 - HELD THAT - Since the Circular of CBDT dated 22.08.2019 fixed the monetary limit at a sum of ₹ 1 Crore to file an appeal, the present appeal which has a tax effect of ₹ 3,45,203/- is not maintainable. Moreover, there is no challenge to the constitutional validity of the Act or the Rules and no notification/instructions/Order or Circular is held illegal or ultravires. This appeal is dismissed on the short ground of monetary limit.

Summary

Issues:
- Challenge to order of Customs, Excise and Service Tax Appellate Tribunal (CESTAT) by Commissioner of Central Excise, Customs and Service Tax, Mysuru.
- Availing of CENVAT credit by a registered manufacturer.
- Demand of duty and penalty under Central Excise Act.
- Appeal filed by respondent against Deputy Commissioner's order.
- CESTAT setting aside Deputy Commissioner's order.
- Appeal by revenue against CESTAT's order.
- Dispute over monetary limit for filing appeal based on CBDT circular.

Analysis:
- The judgment involves an appeal under Section 35G of the Central Excise Act, 1944 filed by the Commissioner of Central Excise, Customs and Service Tax, Mysuru challenging the order passed by the CESTAT. The respondent, a registered manufacturer, availed CENVAT credit on inputs used in final products during a specific tax period. A show cause notice was issued demanding duty and proposing a penalty under the Central Excise Act. The Deputy Commissioner confirmed the demand and imposed a penalty, leading the respondent to appeal before the CESTAT.

- The CESTAT, after considering submissions from both parties, relied on its previous decision in GEI Industrial Systems Limited and set aside the Deputy Commissioner's order. This decision of the CESTAT was challenged by the revenue in the present appeal. The revenue argued that the tax effect was a specific amount and referred to a circular issued by the CBDT regarding the monetary limit for filing appeals.

- The CBDT circular dated 22.08.2019 set the monetary limit at a higher sum than the tax effect in the present appeal. The revenue contended that since the appeal did not involve a challenge to the constitutional validity of the Act or Rules, or any illegalities in notifications or circulars, the appeal was not maintainable due to the monetary limit set by the CBDT circular. Consequently, the appeal was dismissed solely on the grounds of not meeting the monetary limit criteria set by the CBDT circular, emphasizing the importance of adhering to the prescribed limits for filing appeals in tax matters.