2024 (10) TMI 1340 - HC - Central Excise

CENVAT credit of the duty paid on the materials and capital goods used for fabrication, erection and commissioning of both the paint shops on turn key basis - immovable property embedded to earth and ceiling are not excisable goods - scooter and motorcycle plants was wrongly taken and irregularly utilized by them - interest at the appropriate rate leviable on the amount availed wrongly and utilized irregularly - penal action for the act of omission and commission under the provision of the Central Excise Act, 1944. HELD THAT - The proposed questions of law, however, stand finally adjudicated and decided in favour of the assessee by this Court vide judgment dated 12.01.2024, in COMMISSIONER, CENTRAL EXCISE COMMISSIONERATE, SONEPAT (DELHI-III) VERSUS M/S. ULTRATECH CEMENT LTD. 2024 (1) TMI 959 - PUNJAB AND HARYANA HIGH COURT wherein, this Court has held ' The view taken as such was that the amendment could only operate prospectively which was made in the Cenvat Credit Rules, 2004 which came into force from 07.07.2009 and in such circumstances the benefit had been granted regarding the issue of the structures which are embedded to the earth and whether the structures were to be treated as inputs used in final products as input for capital goods.' This Court has rejected the appeal on limitation. However, since the delay is condoned, the appeal on limitation is not dismissed. As no substantial question of law worth examining left in the present appeal, the same is accordingly dismissed. Appeal dismissed.

Summary

Issues:
Whether the cenvat credit of duty paid on materials and capital goods used for fabrication, erection, and commissioning of paint shops was wrongly taken and utilized irregularly. Whether interest and penal action are leviable for the irregular utilization of cenvat credit.

Analysis:
The appellant raised questions regarding the utilization of cenvat credit on materials and capital goods for the paint shops, arguing that the goods were not excisable under relevant acts. However, the court referred to a previous judgment in Commissioner vs. M/s Ultra Tech Cement Ltd., where it was held that the issue had been settled in favor of the assessee. The court cited judgments from other high courts to support this decision, stating that the amendment to the Cenvat Credit Rules operated prospectively. Consequently, the court found that the issue had been conclusively decided in favor of the assessee, and there was no need to consider limitations or suppression argued by the Revenue.

The court noted that the previous judgment had already rejected the appeal on limitation, but since the delay had been condoned, the current appeal would not be dismissed on limitation grounds. As there were no substantial questions of law left to examine, the court dismissed the appeal accordingly. All pending applications were also disposed of in line with the dismissal of the appeal.