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Central Excise - Case Laws
Showing 181 to 200 of 81317 Records
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2024 (10) TMI 804
Rectification of mistake - error apparent on the face of record - time limitation - Interpretation of exempted goods under Notification No. 12/2012-CE for the purpose of Rule 6(3A) calculations - HELD THAT:- It is found that when section 11A was amended, it was not specified that it will apply to only cases where the cause of action arises thereafter. It also did not say that the new limitation will have retrospective effect. In this case, the cause of action arose before the amendment, but the show cause notice was issued after the amendment.
It is found that limitation is part of the procedural law and it will apply to those cases where the suit or proceedings have yet to be instituted, regardless of the period of the cause of action. If the cause of action arose before the amendment but the proceedings were initiated thereafter, the amended limitation will apply. However, if the period of limitation had already lapsed under the old law before initiating the proceedings, the amendment will not revive the lapsed period.
In this case, although the cause of action arose prior to the amendment, the show cause notice was issued after the amendment. The cause of action, viz., the alleged short reversal of an amount under Rule 6(3A) occurred during April 2012 to March 2016 and the limitation was increased to two years on 14 May 2016. The show cause was issued on 6 June 2017. Therefore, the period from May 2015 to March 2016 was within the normal period of limitation of two years on the date of issue of show cause notice.
The appellant itself had chosen the option of following Rule 6(3A) and the department had not forced it upon the appellant. Having chosen an option, the appellant calculated the amount to be paid in a particular manner which, according to the Revenue, was incorrect. Only the calculation of the amount is in dispute. Specifically, the dispute was whether the goods exempted by notification no. 12/2012-CE should be considered as exempted goods or not exempted goods for the purpose of calculation of an amount to be paid under Rule 6 (3A) of CCR, 2004. Once the assessee has chosen an option and the dispute is only regarding the recovery of the amount short paid as per Rule 6(3A), Rule 6 itself provides for recovery of such amount in the manner provided in Rule 14 of CCR.
While Rule 14 itself does not provide for recovery of an amount not paid or short paid under Rule 6(3A), Explanation III to Rule 6 provides for such recovery. It is under this provision that the demand was made and confirmed. In fact, the learned counsel for the appellant himself admitted in his response to the department’s Miscellaneous Application that this Explanation does provide for recovery of an amount but asserted that it does not provide for recovery of interest or imposition of penalty.
Application filed by the Revenue is partly allowed and the demand of an amount under Rule 6(3A) within the normal period of limitation is upheld but not interest thereon or penalty.
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2024 (10) TMI 803
Utilization of Edu Cess credit and SHE cess lying in balance 01-03-2015 towards payment of Central Excise Duty for the month of June 2017 - recovery with penalty u/s 11AC of the Central Excise Act, 1944 - HELD THAT:- The N/N. 12/2015-CE(NT) dated 30.04.2015 amended the Rule 3 (7) (b) of Cenvat Credit Rules. By insertion and following provisos, the notification does not provide that Cenvat credit of Education- cess/ Secondary and Higher Education-cess available with the Appellants as on 28.02.2015 stands lapsed. The said credit is available with the Appellant for utilization of the same for payment of due Central Excise duty as the the rates of Central Excise duty were made inclusive of the leviable Education cess and Secondary and Higher Education cess.
The Notification No.12/2015-CE(NT) has been issued amending the Cenvat Credit Rules as to implement the above proposed amendment in the rate of duty as per the Hon’ble Finance Minister’s Speech - the notification number 12/2015-CE (NT) is totally silent on the issue of accumulated credit of the education cess and higher education cess available with the Appellants as on 01.03.2015, It do not provide that this credit shall lapse, or cannot be used for payment of the excise duty in which these cesses have been subsumed.
Appeal allowed.
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2024 (10) TMI 721
Maintainability of petiiton - non-compliance of the statutory requirement of pre-deposit - power of the Tribunal or the Commissioner (Appeals) to waive the pre-deposit requirement - HELD THAT:- It would be seen from a bare perusal of section 35F of the Central Excise that after August 06, 2014 neither the Tribunal nor the Commissioner (Appeals) have the power to waive the requirement of pre-deposit, unlike the situation which existed prior to the amendment made in section 35F on August 06, 2014 when the Tribunal, if it was of the opinion that the deposit of duty and interest demanded or penalty levied would cause undue hardship, could dispense the said deposit on such conditions as it deemed fit to impose so as to safeguard the interest of the Revenue.
The Supreme Court in Narayan Chandra Ghosh vs. UCO Bank and Others [2011 (3) TMI 1478 - SUPREME COURT], examined the provisions contained in section 18 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 relating to pre deposit in order to avail the remedy of appeal. The provisions are similar to the provisions of section 129E of the Customs Act. The Supreme Court emphasised that when a Statute confers a right to appeal, conditions can be imposed for exercising of such a right and unless the condition precedent for filing appeal is fulfilled, the appeal cannot be entertained. The Supreme Court, therefore, held that deposit under the second proviso to section 18(1) of the Act, being a condition precedent for preferring an appeal, the Appellate Tribunal erred in law in entertaining the appeal. The Supreme Court also held that the Appellate Tribunal could not have granted waiver of pre-deposit beyond the provisions of the Act.
It will also be appropriate to refer to a decision of the Delhi High Court in Dish TV India Limited vs. Union of India & Ors. [2020 (8) TMI 183 - DELHI HIGH COURT], wherein the requirement of pre-deposit under section 129E of the Customs Act, came up for consideration. The High Court held that when the Statute itself provided wavier of pre-deposit to the extent of 90% or 92.5% of the duty amount and made it mandatory to deposit 7.5% or 10% of duty amount, the Courts cannot waive this requirement of deposit.
The appellant has not made the pre-deposit. In view of the aforesaid decisions of the Supreme Court and the Delhi High Court, it is not possible to permit the appellant to maintain the appeal without making the required pre-deposit.
Appeal dismissed.
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2024 (10) TMI 720
Rejection of availment of Cenvat credit on the grounds that it was availed more than 1 year after the date of issuance of the documents - denial of CENVAT Credit in respect of services which were used at salt pans for manufacturing salt which was the raw material for manufacturing soda ash.
Whether the Commissioner (Appeals) was right in rejecting the availment of the Cenvat credit, amounting to Rs.46,27,417/- for the period of 03.12.2005 to 31.03.2012 on the ground that the credit was availed more than 1 year after the date of the issuance of the documents? - HELD THAT:- The case of the department is that the credit should have been taken within 1 year from the date of invoice. Therefore, in respect of this Cenvat Credit since, the credit was taken after 1 year the same is not admissible. It is found that for arriving at this conclusion the Revenue has relied upon the provision 11 A and 11 B. These Sections nowhere prescribe about the time limit for availment of the Cenvat credit. Therefore, the borrowing of the provision of Section 11A and 11B is absolutely illegal and incorrect. As regard the amendment in Cenvat Credit Rules, 2004 prescribing the time limit of 1 year, the said amendment was made on 11.07.2014. Since in present case, entire period is up to 31.03.2012, the credit on the time limit cannot be denied.
In case of Roquette Roquette Riddhi Siddhi P Ltd vs. C.C.E.-Ahmedabad-II [2024 (1) TMI 1210 - CESTAT AHMEDABAD] this Tribunal has held that 'appellants have correctly taken the cenvat credit on 18/09/2014 for the invoices issued prior to 01/09/2014.'
Whether the respondent can be denied Cenvat credit of the services which were used at salt pans for manufacturing salt which was the raw material for manufacturing soda ash? - HELD THAT:- There is no dispute that the appellant is engaged in manufacture of salt in their factory for the purpose of manufacturing the soda ash. The appellant used salt which is the main input material. The salt is procured through salt pans which is obviously located outside the factory premises. For procurement of salt from the salt pans input service is used. Since, the salt is used directly in the manufacture of the final product viz. soda ash, the service used for procuring the salt from salt pans is directly in or in relation to manufacture of soda ash.
In the various cases, it is consistently held that merely because the service is used outside the factory premises, Cenvat Credit cannot be denied so long the service has nexus with the manufacturing activity of the manufacturer. Therefore, merely because the input service is used outside the factory premises for procuring the salt from the salt pans, credit cannot be denied.
In the case of PARRY ENGG. & ELECTRONICS P. LTD. VERSUS C.C.E. & S.T., AHMEDABAD-I, II, III [2016 (1) TMI 546 - CESTAT AHMEDABAD-LB], the issue involved was that the service was received in connection with the windmills of generation of electricity which is located outside the factory premises. The Revenue has disputed the credit only on the ground that the service was received outside the factory premises. The Larger Bench of the Tribunal, Ahmedabad clearly answered the question in favour of the assessee whereby it was held that even if the service is received outside the factory but in relation to the manufacture of the final product, the credit cannot be denied.
Thus, the appellant is entitled for the Cenvat credit in respect of input service received at salt pans.
Both the issues involved in the present case are in favour of the assessee. Hence, the impugned order stands modify to the above extent. The assessee’s appeal is allowed.
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2024 (10) TMI 719
Levy of of Central Excise Duty - Ready Mix Concrete (RMC) manufactured at construction sites - activity of job-work or not - extended period of limitation - HELD THAT:- The undisputed facts in the present case are that appellant was manufacturing “Ready Mix Concrete” (RMC) at the site of the builder, as per requirement of the builder and out of the raw material provided by the builder. The contention of the revenue for the reason that the plant (Plant and Machinery) used for such activities was procured by the appellant and was owned by them would not alter the situation that appellantwas manufacturing the entire goods out of the raw material provided by the builder. Thus he was the job worker as the ownership of plant and machinery is not relevant for determination whether the activities undertaken by him is job work or otherwise. It is the relationship between the material supplier and the processor which would determine whether the activity is of job work or not.
In the present case when the activity was undertaken on the raw material supplied by the builder the processor is nothing but the job work.
From perusal of the definition of job-work and job-worker, it is clear that the job-work and job-worker has been defined clearly with reference to the processing of raw material or sami-finished goods supplied to the job-worker. The definition does not make any reference to the plant and machinery or its ownership.
As the appellant was undertaking clearances of the goods manufactured on behalf of builder, the duty was required to be assessed and paid by the appellant even if he was a job worker.
Extended period of limitation - HELD THAT:- On account of change of opinion in view of the decision of Hon’ble Supreme Court in the case of Larsen and Tubro Ltd. [2015 (10) TMI 612 - SUPREME COURT], extended period could not have been invoked for making the demand as has been rightly held by Commissioner (Appeals) and the demand has been confined to the normal period of limitation. Commissioner (Appeals) has by the impugned order directed the original authority to calculate the demand of duty and interest payable for the normal period.
In case appellant has raised the grounds that if excess duty was due, they were liable for concessional rate of duty as no Cenvat credit was paid, we do not have anything available on the record to verify the said claim, while determining the duty liability as per the directions of Commissioner (Appeals). Original Adjudicating Authority should consider this aspect and determine the duty after allowing for admissible exemptions, if any. Appellant has stated with regards to the exemption of normal period of limitation.
There are no merit in the appeal filed by the appellant - the impugned order is upheld - appeal dismissed.
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2024 (10) TMI 678
Rectification of Mistake - error apparent on the face of record - HELD THAT:- The impugned order which we have affirmed in the final order dated 05.03.2024 have decided the issue on merits against the appellant, however, on limitation, the issue has been held to be against the revenue and, therefore, the demand of duty stood confirmed to the period from Jan. 2017 to June, 2017. In the circumstances, the present application for rectification of mistake is nothing but another attempt by the appellant to re-open the appeal to somehow evade the duty demand. The same is not permissible.
There are no merits in the Rectification of Mistake application, which is hereby rejected.
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2024 (10) TMI 677
CENVAT Credit - capital goods - case of the department is that since at the time of receipt of capital goods, the appellant’s goods were exempted under N/N. 30/2004-CE. they are not eligible for Cenvat credit on the capital goods - Rule 6(4) of Cenvat Credit Rules - HELD THAT:- The issue in the appellant’s own case is squarely covered by this Tribunal’s final order in [2019 (11) TMI 292 - CESTAT AHMEDABAD] where it was held that 'It is also observed that the Tribunal in the cited judgments under the same set of facts and dispute related to notifications 29/2004-CE and 30/2004-CE held that even though initially “Nil” rate of duty exemption under notification 30/2004-CE has been availed and subsequently, notification no. 29/2004-CE availed and paid the duty, the Cenvat Credit on capital goods is admissible.'
From above decision, it can be seen that the facts of the present case are identical to the fact of the above case in the appellant’s own case. Therefore, ratio of the above decision is directly applicable. Accordingly, the appellant is entitled for the Cenvat credit on capital goods.
The impugned order is set aside - Appeal is allowed.
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2024 (10) TMI 676
Eligibility for concessional rate of duty under Notification No. 23/2003-CE for Domestic Tariff Area (DTA) clearances - Invocation of extended period of limitation under Section 11A of the Central Excise Act, 1944 - Imposition of penalty on the Deputy General Manager under Rule 26 of Central Excise Rules, 2002.
Whether the appellant are entitled to the concessional rate of Central Excise duty on the clearances effected by them on Ammonium Carbonate Liquor and Ammonium Sulphate? - HELD THAT:- It is a matter of record that the appellants have fulfilled the export obligation and only the by-products as mentioned above have been cleared at the concessional rate of duty availing benefit of Notification No. 23/2003-CE dated 31.03.2003.
It can be seen from the provisions of Para 6.8 (g) of the Foreign Trade Policy that by-products can be cleared at the concessional rate of duty if 100% EOU has already achieved positive NFE.
It is found that appellant have fulfilled their export obligation and there is no allegation that NFE has not been achieved by the appellant of permissible export products and therefore, the provisions relating to clearance of its by-products in Domestic Tariff Area at the concessional rate of duty are undoubtedly available to the appellant, more so when NFE has been positive in case of the appellant - the appellant have rightfully availed the benefit of concessional rate of duty under Notification No. 23.2003-CE dated 31.03.2003 an clearances of its by products.
Extended period of limitation - HELD THAT:- The appellant have been informing the department about the by-products which have been cleared by them availing concessional rate of duty under Notification No. 23/2003-CE dated 31.03.2003. It is found that element of fraud, mis-representation, suppression of facts with intention to evade duty are not present in this case and therefore, there are no legally sustainable to invoke extended time proviso under Section 11A of Central Excise Act, 1944 for demanding Central Excise duty. The first show cause notice is barred by period of limitation also.
Imposition of penalty on the Deputy General Manager under Rule 26 of Central Excise Rules, 2002 - HELD THAT:- There are no reason for imposition of penalty on Shri A.K.Nayak and accordingly, the penalty imposed an appellant Shri A.K.Nayak is set aside.
The impugned order is set aside - appeal allowed.
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2024 (10) TMI 672
Clandestine manufacture and removal - excess stock - admissibility of electronic records under Section 36B of the Central Excise Act - printouts allegedly taken from the computerized records of the noticee - burden to proof - HELD THAT:- The Central Excise Act contains a specific provision that describes the manner in which the admissibility of computer print outs will be accepted as evidence in proceedings initiated under the Central Excise Act.
In respect of section 65B of the Evidence Act, which is pari materia to the provisions of section 36B of the Central Excise Act, it would be relevant to refer to the observations made by the Supreme Court in ANVAR P.V VERSUS P.K. BASHEER AND OTHERS [2014 (9) TMI 1007 - SUPREME COURT], the Supreme Court, held that evidence relating to electronic record shall not be admitted in evidence unless the requirement of section 65B of the Evidence Act is fulfilled.
The aforesaid judgment of Supreme Court in Anvar P. V. was followed by the Supreme Court in ARJUN PANDITRAO KHOTKAR VERSUS KAILASH KUSHANRAO GORANTYAL AND ORS. [2020 (7) TMI 740 - SUPREME COURT], though with a slight modification. The Supreme Court held that if the original device is not produced, then electronic record can be produced in accordance with section 65B (1) of the Evidence Act together with the requisite certificate under section 65B (4).
It is not in dispute that the hard disk from which the printouts were subsequently taken was not found installed in the CPU. The Panchnama drawn on 04.07.2013 records that the officers found that Vaibhav Goel had removed a hard disc from his kitchen and had tried to throw it away. The panchnama does not mention that any officer had seen Vaibhav Goel actually remove the hard disc from the CPU. It only records that Vaibhav Goel had removed a hard disc from the kitchen and had tried to throw it away. At a different place, the panchnama records that the officers conducted a thorough search of the entire residential premises and found one hard disc hidden in a corner lying near the dog house. What needs to be noticed is that if Vaibhav Goel had thrown the hard disk, it would not have been found hidden in a corner of a room near the dog house. The seven pen drives were also recovered from a room on the first floor of the rear side of the house. In the said room three computer monitor were also installed without a CPU - There is nothing on the record to link the hard disk to the CPU, nor is there anything to link that the hard disc and the pen drive stored information contained in the computer.
The printouts, which are the sole basis for holding that the appellant had indulged in clandestine removal, were taken both on 04.07.2013 and on 15.07.2013 by placing the recovered hard disc and pen drive in the CPU.
It is, therefore, clear that the CPU did not contain the hard disk. The hard disk was in fact picked up from the corner of the room. No attempt was made by the department to admit the hard disk and the pen drive in evidence. The required certificate under section 36B (4) of the Central Excise Act was also not produced. Thus, no reliance can be placed on the printouts, in view of the two judgments of the Supreme Court in Anvar P. V. and Arjun Panditrao Khotkar and the three decisions of the Tribunal in M/S AGARVANSHI ALUMINIUM LTD & OTH VERSUS COMMISSIONER OF CUSTOMS (I), NHAVA SHEVA [2013 (10) TMI 856 - CESTAT MUMBAI], M/S POPULAR PAINTS AND CHEMICALS REFERRED AS, SHRI MANSOOR ZAFFAR, SHRI HUSSAIN ZAFFAR VERSUS COMMISSIONER OF CENTRAL EXCISE AND CUSTOMS RAIPUR [2018 (8) TMI 473 - CESTAT NEW DELHI] and GLOBAL EXTRUSION PRIVATE LIMITED, SHRI VIJAY MADHUSUDANBHAI DAVE, SHRI DEEPAK KUMAR BABULAL NAGAR, SHRI MANOJ VIJAYKUMAR GUPTA, SHRI MANHAR AMARSHIBHAI CHAVDA, SHRI NIMESHKUMAR JAYANTIBHAI VAGHELA, SHRI JIGNESH BHIMJIBHAI PATEL, SHRI VIPUL DAMJIBHAI SANGHANI, SHRI BABULAL JETHABHAI SABHAYA, SHRI SHARAD KUMAR KALAYANJI VASANT, SHRI SHARAD KUMAR KALAYANJI VASANT, SHRI BHAGESHBHAI JAYANTIBHAI CHANDERIA, SHRI MANOJBHAI DAYABHAI AKBARI PATEL VERSUS COMMISSIONER OF CENTRAL EXCISE & ST, RAJKOT [2024 (1) TMI 772 - CESTAT AHMEDABAD].
It is, therefore, not possible to accept the contention advanced by the learned authorized representative appearing for the department that panchnama itself should be treated as a certificate or that the adjudicating authority was justified in itself examining whether the conditions set out in section 36B (4) of the Central Excise Act had been satisfied.
The impugned order dated 30.06.2021 passed by the adjudicating authority, therefore, cannot be sustained - appeal allowed.
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2024 (10) TMI 623
Entitlement to avail input tax credit of the tax paid - input services - services availed from goods transport agencies for transporting the products manufactured by it to the premises of the buyer concerned under a contract that was entered on Freight on Road (FOR) basis - HELD THAT:- While it may be a fact that in the decision of the Supreme Court in COMMISSIONER, CUSTOMS AND CENTRAL EXCISE, AURANGABAD VERSUS M/S ROOFIT INDUSTRIES LTD. [2015 (4) TMI 857 - SUPREME COURT] that is relied upon by the learned counsel for the appellant, it was found that in circumstances where a manufacturer enters into a contract with his buyer on FOR basis, the place of removal for the purposes of payment of Central Excise duty has to be seen as the buyer's premises and not the manufacturer's factory, the upshot of the said finding was that the manufacturer, in that case, was legally obligated to include the cost of transportation of the goods from his factory to the premises of the buyer in the assessable value of the goods for the purposes of payment of Central Excise duty.
In the instant cases, however, it is found that it is the admitted case that the appellant did not include the transportation costs in the assessable value of the goods for the purposes of payment of Central Excise duty.
It is failed to see how the appellant can claim input tax credit in respect of the transportation services availed by it for the purposes of transporting the goods from the place of removal to the buyer's premises - there are no reason to interfere with the order of the Tribunal impugned in these appeals - appeal dismissed.
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2024 (10) TMI 622
Clandestine Removal - retraction of affidavits and statements - reliance placed on statements of transporter - absence of corroborative evidence supporting illicit manufacture - It has been contended that no demand of Central Excise Duty could be made without a source document, particularly only on the basis of a data entry worksheet prepared in a tabular form on a computer, in absence of required certificate u/s 36B of Central Excise Act, 1944 - HELD THAT:- It is found from the impugned order that M/s Patel Product in their reply to the SCN filed before the adjudicating authority, had submitted copies of retraction affidavits of the persons, whose statements were recorded under summons during the course of investigation of the present dispute. The department had also conducted an enquiry into the retracted affidavits, the fact of which is evident from the available case records. The department had called for the information about the authenticity and veracity of the stamp papers from the Collector of Stamps (stamp paper issuing authority), Thane, in context with the officially recorded dates, on which the stamp papers were issued by them; the name of the stamp vendor to whom they were issued; the date of subsequent sale by the stamp vendor and the name of the person to whom such stamps were ultimately sold for actual use by the stamp vendor etc.
In the present case, the facts are not under dispute that the retracted affidavits are completely ignored and not taken into consideration, then in that case, what remains for consideration is mere confessional statements. It is a settled principle of law that demand cannot be sustained, based on stand-alone confessional statements, in the absence of corroborative evidences. When the officers of the Central Excise Department had failed to carry out any investigation at the end of raw material suppliers and were also unable to have brought out any independent evidence to prove that printed plastic pouches of ‘Om Special Pandharpuri Tambakoo No. 1’ were procured surreptitiously for the purpose of packing the said branded tobacco, it cannot be said that the department has made out a case against the appellants, alleging involvement in the fraudulent activity of clandestine removal of excisable goods. Thus, placing reliance only on the confessional statements, without proper corroboration with the documentary evidences cannot be considered as valid or justified action, which would suffice to prove the charges of clandestine removal of excisable goods.
This Tribunal, in the case of JEEN BHAVANI INTERNATIONAL AND MAHESH CHANDRA SHARMA KARTA VERSUS COMMISSIONER OF CUSTOMS- NHAVA SHEVA-III [2022 (8) TMI 237 - CESTAT MUMBAI], has held that in a case, where statement recorded by the officers of the department are not provided to the respective person at that very moment and that the same are provided only along with the SCN, in that case, the only opportunity which the deposer of the statement would get for the purpose of retracting the statement is only after the issuance of SCN, when he is handed over with the said statement. In such a case, the Tribunal has held that if a retraction affidavit is made after the issuance of SCN, then the said retraction would be considered as a valid retraction.
During the course of investigation, statements of the packing labourer and labour supervisor of Unit III of M/s. Patel Product, Kurla, were recorded and relied upon in the adjudication order. On that basis, the adjudicating authority has observed that ‘Om Special Pandharpuri Tambakoo No. 1’ was produced in excess, and were removed outside the premises in a clandestine manner. It is an admitted position that the appellants had requested the adjudicating authority for affording cross examination of the said labour supervisor and packing labourer. However, the same was denied. Under such circumstances, in terms of Section 9D ibid, such statements have lost their evidential value and cannot be relied upon in isolation, without any further documentary evidence for confirmation of the adjudged demands.
Further, the allegation of clandestine manufacture and clearance of excisable goods is a serious charge, and the burden to prove such charge is entirely lies with the Revenue - the Revenue has not brought on any substantial evidence to prove such allegation levelled against the appellants.
The charges of clandestine clearance of branded tobacco, as levelled against the appellant M/s. Patel Product cannot be sustained inasmuch as Revenue has not brought out any substantial documentary evidences to prove such charges. Therefore, the adjudged demands confirmed on the appellant M/s. Patel Product fails and consequently, the penalties imposed on the other appellants in the impugned order cannot be sustained.
There are no merits in the impugned order, insofar as it has confirmed the adjudged demands on the appellants. Therefore, the impugned order is set aside - appeal allowed.
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2024 (10) TMI 621
Cenvat Credit on inputs and input services for the period from August 2010 to March 2015.
Denial of credit on Inputs - disallowance on the ground that the same was used either for laying foundations or making support structures for the capital goods which have been specifically excluded based on the revised definition of ‘inputs’ and ‘capital goods’ as per CENVAT Credit Rules, 2004 for the period 01.04.2011 to 30.06.2012 and from 01.07.2012 to 31.03.2015 - HELD THAT:- The only plea taken by the appellant is that the inputs are directly or indirectly used in the manufacture of final products, ignoring the fact that they are specifically excluded from the definition of inputs. In view of the above, the denial of cenvat credit on the inputs during the relevant period is upheld in view of the revised definition of ‘input’ and ‘capital goods’ of CENVAT Credit Rules, 2004.
Denial of credit on Earth Excavation Works - HELD THAT:- As seen from the invoices placed by the assessee, the Commissioner in the impugned order has held that the description of work order in the invoices are shown as ‘Earth Work in soft soil, hard rock and soft work and disposal of the soil from the work area’. Thus, the work order being in the nature of civil work and this being excluded from the ‘input service’ with effect from 01.04.2011, the credit has been rightly denied - As seen from the definition of the ‘input services’ during the relevant period, it is very clear that the services of laying a foundation or making of structures a construction or execution of works contract are specifically excluded. Therefore, the Commissioner was right in denying the benefit of cenvat credit on all those invoices where it has been categorically mentioned as Earth Excavation Works.
Credit on Erection and Commission and Installation services - HELD THAT:- Since there is no dispute that the goods were used in the office within the factory premises, the cenvat credit is allowed. The Commissioner has denied the benefit on Road Works on the ground that the road work carried out inside the factory is a civil structure and hence, excluded from the purview of the definition of ‘input services’. Since these services are also excluded from the definition of the ‘input services’, rejection of the cenvat credit by the Commissioner is upheld. The amount of credit of Rs.1,26,48,722/- disallowed by the Commissioner has also been reversed by the appellant partly at the time of the adjudication, which has been appropriated in the order; the balance amounts have been reversed on 12.11.2016 along with the interest paid on 07.12.2016 (reversal entry No.2503 with regard to inputs and reversal entry No. 2500,2501 and 2502 with regard to input service). The 25% of the demand which works out to Rs.29,83,667/- has been also paid as penalty amount vide Challan No. 00046 and 00047 dated 07.12.2016. Since, the entire amount has been paid along with the interest and 25% penalty within 30 days of the date of the order, penalty imposed under Section 11AC cannot be sustained.
Amounts allowed by the Commissioner as eligible cenvat credit - major amount (Rs.5.20 crores) relates to structural steel items which are used for the manufacture of various capital goods and the Commissioner on verifying the various documents and Chartered Engineer certificate and based on the Jurisdictional Range Officer’s verification has held that the assessee is eligible for the benefit of the cenvat credit - HELD THAT:- The objections raised by the department in their grounds of appeal is that the Jurisdictional Ranger Officer has categorically mentioned that it is not possible to correlate invoice-wise material details with that of the material used and various statements that confirmed the cenvat credit was irregularly availed was ignored by the Commissioner. However, the observations of the Commissioner in the impugned order which are based on facts and the Chartered Engineer’s Certificates cannot be brushed aside. The Range Officers have not disputed the fact that the inputs and input services being used in the factory but only observed that one to one correlation could not be made. It is a settled issue that as per Cenvat Credit Rules one to one correlation is not required but it has to be established that it is used within the factory and satisfies the definition of the ‘input’ and ‘input services’. The Commissioner has clearly established this fact and hence, there are no reason to deny the benefit of cenvat credit as allowed by the Commissioner in the impugned order.
Appeal disposed off.
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2024 (10) TMI 620
Denial of CENVAT Credit wrongly availed and utilized with interest and penalty - Extended period of limitation - HELD THAT:- The impugned order appropriates an amount of Rs.3,58,58,266/- alongwith interest of Rs.48,132/- reversal/payment which was reported to the concerned Authorities vide letter dated 11.02.2011 and 29.03.2011. As these amounts have been paid and reported by the Appellant either on his own violation or on being pointed out by the Revenue Authorities, the short payment if any on this account should have been questioned and a show cause notice issued within one year from the date of receipt of these letters dated 11.02.2011 and 29.03.2011 as per the provisions of Section 11A(3).
For such payment there cannot be any reason for invocation of extended period of limitation for making a demand by way of issuance of show cause notice under Section 11A (4) to the extent of these amounts paid. There are no merits in the impugned order invoking extended period of limitation.
For remaining amounts, it is found that the whole issue is that credit has been taken against the bill of entries; however at the time of Audit/scrutiny, Appellant produced photocopies of the bill of entries as original was not traceable. Nothing is available on record to show that the original copy of the bill of entries was subsequently produced. Let it be as it is, this issue is no more res integra and following has been held by Delhi Bench in the case of CENTURY METAL RECYCLING PVT. LTD. VERSUS CGST, CCE, ALWAR [2018 (7) TMI 984 - CESTAT NEW DELHI] where it was held that 'As long as the input is received in the factory of the production and used for the manufacture of excisable goods, there should not be any bar in taking Cenvat credit under Rule 9 thereof which is substantial benefit and not to be denied on account and procedural ground. In this case, Revenue has not brought before us there is any loss caused by the appellant to the Revenue but for the procedural aspect of taking credit at the strength of photo copy of bill of entry.'
There are no merits either invocation of extended period of limitation for denial of the credit on this ground. Demand to this extent also needs to be set aside.
The amount of Rs.3,58,58,266/- with interest of Rs.48,132/- had been deposited by the appellant and jurisdictional authorities informed in terms of Section 11A(2) much prior to the issuance of the show cause notice - for the remaining amount of Rs.5,47,862/- the irregularity being held as technical lapse, the same could not be covered by the words used in the sub-section 11A(4).
Appeal allowed.
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2024 (10) TMI 619
Levy of penalty imposed on co-noticee - main appellant has opted for settling the issue under SVLDRS - HELD THAT:- As held by this Tribunal in similar cases appeal filed by the appellant challenging the personal penalty arising within the same Order-in-Original is unsustainable.
Reliance can be placed in SHRI S. BHARATH REDDY, MANAGING DIRECTOR, M/S. BRITISH NUTRITIONS PRIVATE LIMITED & SHRI V.S. REDDY, EXECUTIVE DIRECTOR, M/S. BRITISH NUTRITIONS PRIVATE LIMITED, VERSUS COMMISSIONER OF CENTRAL EXCISE, BANGALORE [2024 (6) TMI 1394 - CESTAT BANGALORE] where it was held that 'once the main appeal is settled under SVLDRS, 2019, the appeals filed by the co-noticees challenging the personal penalty arising out of the same Orderin-Original cannot be sustained.'
The appeal filed by the appellant is allowed.
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2024 (10) TMI 618
CENVAT Credit - capital goods removed from the factory - Applicability of concept of “transaction value” to the goods which are not manufactured by the respondent - interpretation of Rule 3 (5A) (ii) of Cenvat Credit Rules, 2004 - HELD THAT:- It is evident from the impugned order that the Commissioner (Appeals) completely misread Rule 3 (5A) of CCR under which the demand was confirmed. The Commissioner (Appeals) also committed an error in treating the expression “transaction value” as “assessable value” on which duty is paid. “Transaction value” is the amount paid by one person to another for the goods or services received. Therefore, if the respondent had sold its capital goods to another company, there will be a “transaction value” i.e., the price for which it had sold the used capital goods. A plain reading Rule 3 (5A) of CCR leaves no manner of doubt that there would be a transaction value when goods are sold, even if such goods are not manufactured by the seller.
This is a fit case to be remanded back to the Commissioner (Appeals) to examine Rule 3 (5A) of CCR as applicable during the relevant period and also examine what is value of the capital goods on which the respondent had taken capital goods CENVAT credit.
The matter is remanded to the Commissioner (Appeals) to decide the appeal afresh considering the submissions made by the respondent and also the legal provisions as applicable during the relevant period - Appeal allowed by way of remand.
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2024 (10) TMI 617
CENVAT Credit - GTA Services - outward freight - clearance of the goods from their premises to the depots or to the premises of the customers on FOR basis - period 2012-13 to 2016-17 - HELD THAT:- The reason for denial of the said credit is in the decision of the Hon’ble Supreme Court in the case of M/s Ultratech Cement Ltd [2007 (3) TMI 738 - CESTAT AHMEDABAD]. However, it is also noted that this issue has been finally clarified by the Board by Circular No.1065/4/2018-CX dated 08.06.2018. After taking note of the decision of the Hon’ble Supreme Court in the case of Ultratech Cement Ltd. and COMMISSIONER, CUSTOMS AND CENTRAL EXCISE, AURANGABAD VERSUS M/S ROOFIT INDUSTRIES LTD. [2015 (4) TMI 857 - SUPREME COURT] it was clarified that 'after amendment of in the definition of “input service” under Rule 2(l) of the CENVAT Credit Rules, 2004, effective from 01.03.2008, the service is treated as input service only “up to the place of removal”.'
Undisputedly in the present case the supplies were made on FOR basis and the value of the goods for payment of duty determined accordingly. In view of the clarification, it is clear that Cenvat credit in case where supplies were made on FOR basis to the premises of the customers Cenvat credit of the GTA Services shall be admissible.
There are no merits in the impugned order - appeal allowed.
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2024 (10) TMI 616
Partial rejection of refund claims - Incorrect address mentioned in invoices - Invoice were in name of unregistered premises - Invoices pertain to service which do not have any nexus with the output service rendered by the Appellant.
Denial of credit for the reason that invoices do not contain proper details such as address etc. - HELD THAT:- The clarification issued by the Board is very categorical and clear and that refund claims could not have been denied or modified for the reasons that certain details are missing in the invoice. The only requirement this is to be fulfilled is that the service against which the appellant is claiming the input credit and subsequently refund under Rule 5 have been used for providing output services. Once that requirement is satisfied there are no reason as to why the CENVAT Credit on this account could have been denied - Since appellant have centralized registration at NOIDA, the input credit in respect of the services received at Pune and Chennai gets reflected in the common cenvat credit account maintained at NOIDA and in the ST-3 return filed in NOIDA. By taking the credit against the invoices addressed to their premises at Pune and Chennai appellant have not contravened any provision of the Cenvat Credit Rules, 2004 for which the said credit could have been denied.
Refund claim denied/modified on the ground that invoices have been issued in unregistered premises - HELD THAT:- The refunds could not have been modified/denied placing reliance on M/S RAAJ KHOSLA & CO. PVT. LTD. VERSUS CST, DELHI [2008 (7) TMI 122 - CESTAT NEW DELHI] where it was held that 'We find the registration certificate was subsequently amended included the address mentioned in the invoices with retrospective effect. In these circumstances, order whereby credit was disallowed on this ground is set aside and the appeal of the appellant in this regard are allowed.'
Cenvat Credit has been sought to be denied on various services by the impugned order holding the services to be ineligible as input services in terms of Rule 2 (l) of the CENVAT Credit Rules, 2004 - HELD THAT:- The impugned order does not specify the services in respect of which the credit is sought to be denied. Even in the said impugned order credit has been allowed in respect of all the services except for management, maintenance repair services and hospitality services.
Establishment of nexus between the input services and output services - HELD THAT:- It is a settled law that no nexus was required to be established after the amendment made in Rule 5 of CENVAT Credit Rules, 2004 in the year 2011. Only what was required while examining the refund claim under Rule 5 was that credit has been taken during the quarter for which the refund claim is prescribed - there are no justification for denial of CENVAT credit or the refund claim in respect of these input services.
There are no merits in the impugned orders and the same are set aside. The matters in respect of the refund claim are remanded back to the original authority for redetermination of amounts to be refunded to the appellant in terms of rule 5 of CENVAT Credit Rules, 2004 by holding that the disputed credit is admissible.
Appeal allowed by way of remand.
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2024 (10) TMI 563
Maintainability of appeal - mandatory pre-deposit not deposited - Petitioner’s Appeal dismissed on the ground of failure to deposit 7.5% of the demanded tax amount, which is the requirement under Section 35 (F) of the Central Excise Act, 1944 has applicable to the Finance Act, 1994 - HELD THAT:- In the peculiar facts of the present case, some indulgence is due to the Petitioner, who now says that he would arrange to deposit 7.5% of the tax amount demanded within some reasonable period.
Considering the peculiar facts, the petitioner can be granted an additional opportunity without waiving the pre-deposit requirement.
The impugned order dated 30 April 2024 made by the Commissioner (Appeals) is set aside - the Appeal instituted by the Petition is restored on the Commissioner (Appeals) file for reconsideration.
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2024 (10) TMI 562
Cenvat credit - ISO Tank which is used for packing and transportation of the appellant’s excisable final product namely Di-methyl Sulphate (DMS) from factory to the consignee premises/destination - HELD THAT:- The identical issue in the appellant’s own case has been considered by this Tribunal in AARTI INDUSTRIES LTD VERSUS COMMISSIONER OF C.E. & S.T. -SURAT-I [2024 (9) TMI 1169 - CESTAT AHMEDABAD] whereby the matter was remanded to the adjudicating authority for passing a de-novo order.
This matter also needs to be remanded so the adjudicating authority can decide both the matters together - Appeal is allowed by way of remand to the adjudicating authority for passing a fresh order.
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2024 (10) TMI 561
Evasion of Central Excise duty by resorting to gross undervaluation of PTY (Polyester Texturized Yarn) - contention of the investigating agencies was that under the modus operandi while the sale of PTY be shown at the factory gate, the invoice used for clearance of PTY contained name of fictitious buyers and generally such invoices issued contain particulars of buyers - HELD THAT:- It is found from the close scrutiny of the show cause notice and Adjudication order and records related thereto, it is observed that the investigation, all the evidences are absolutely identical and the charge in the show cause notice also same in bunch of cases, out of which majority of cases has been finally settled in favour of the assessee in the case of COMMISSIONER OF CENTRAL EXCISE, VAPI VERSUS SYNFAB SALES [2015 (6) TMI 777 - SUPREME COURT].
The identical issue in the case of COMMR. OF CEN. EXC. & CUSTOMS SURAT VERSUS SURESH SYNTHETICS & ORS. [2016 (4) TMI 838 - SUPREME COURT], the Hon’ble Supreme Court held that 'From the orders passed by the Tribunal and the High Court, it is clear that the revenue has really built its case on the base of the statement made by the authorized officer and, accordingly, there has been intervention by the Tribunal and the High Court. If the whole case is founded on the statement of the authorised officer of the respondent without verification of any other independent evidence, it would not merit acceptance.'
In view of the above judgments, it is clear that the present appeals as well as the above judgments are on identical issue and facts. Therefore, the ratio of the above judgments are directly applicable in the present case. It is also noteworthy that in the present cases, the show cause notices were kept in call book by the department awaiting the decision of Supreme Court in the cases cited above. This also shows that the present appeals are on the identical issue and facts involving the same investigation and evidences as that in the above judgments.
The present appeals of the department do not survive, as the adjudication orders impugned herein do not suffer from any infirmity.
Revenue’s appeals are dismissed.
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