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Central Excise - Case Laws
Showing 21 to 40 of 81316 Records
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2024 (11) TMI 1178
CENVAT Credit - outward GTA service used in connection with clearance of excisable goods namely cement from the factory premise to buyer premise - inclusion of cost of transportation in the assessable value - HELD THAT:- The fact is not under dispute that the appellant have undertaken to deliver the goods at the customer’s premises. The freight charges of GTA on which Cenvat credit was taken is included in the assessable value of the excisable goods. This is evident from the excise invoice raised by the appellant.
From the perusal of the above invoice, it is observed that the freight charges was not separately collected by the appellant, therefore, the same is deemed to be included in the assessable value on which the excise duty was paid. In this identical fact the issue in hand is covered by this Tribunal’s judgment in the case of Ultratech Cement Ltd. [2019 (2) TMI 1487 - CESTAT AHMEDABAD] which was upheld by the Hon’ble Gujarat High Court reported at the Commissioner, Central Goods and Service Tax versus M/s. Ultratech Cement Ltd. [2020 (3) TMI 1206 - GUJARAT HIGH COURT].
The issue involved in the present case is no longer res-integra and accordingly the appellant are entitled for Cenvat credit on outward GTA in the facts of the present case. Hence, the impugned orders are set aside - Appeal allowed.
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2024 (11) TMI 1177
Eligibility for Exemption N/N. 3/2005-CE (amended by Notification 12/2012-serial No. 203) in respect of final product namely Pattis and Pattas - denial of exemption on the ground that as per the description of goods the Pattis and Pattas when subjected to any process other than cold rolling, therefore, in order to be eligible for exemption the Pattis and Pattas manufactured by the appellant must undergo any process other than cold rolling - when the description of goods in the exemption entry to be a condition that the Pattis and Pattas should be subjected to any process other than cold rolling and in absence of any process whether the appellant is eligible for exemption?
HELD THAT:- This issue has been clarified by the Board whereby it was clarified that even if no process is carried out on Pattis and Pattas, the exemption is available. This issue has been considered in detail relying on the said Circular in case of MULTI METAL INDUSTRIES; MORE METAL INDUSTRIES & HAJARILAL RAMCHANDRA SHARMA VERSUS C.C., AHMEDABAD [2023 (10) TMI 1457 - CESTAT AHMEDABAD] where it was held that 'In the present case the Hot Rolling process is admittedly the process which is taken place prior to the process of cold rolling, therefore, in view of the clarification, the Hot Rolled Pattas and Pattis are clearly covered under the Notification No 12/.2012- CE dated 17.03.2012 under Sr. No. 203.'
From the above decision, it can be seen that very identical issue involved in the present case as well in the case cited above. Therefore, the ratio of the above judgment is directly applicable in the present case. Accordingly, the impugned order in the assessee’s appeals are set aside and impugned order in the Revenue’s appeal is uphed.
Assessee’s appeals are allowed. Revenue’s appeal is dismissed.
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2024 (11) TMI 1176
Levy of Excise duty on the job work goods supplied to the customer - activity of cutting, welding, bending etc. for manufacture of parts of structure - Process amounting of amount to manufacture - HELD THAT:- There are catena of judgments, some of the judgments are contrary. Therefore, it clearly shows that the issue was highly debatable and there is a very thin difference between whether the activity amounts to manufacture or otherwise. Therefore, in such case, the matter can be decided only on the ground of limitation without giving final conclusion to the merit of the case. As regard the issue raised by the appellant for demand being time barred, on careful examination of the facts and record, it is found that it is not a case where the appellant have out rightly evaded the duty, firstly, the activity involved is whether manufacture or otherwise covered by the various judgments cited by the Learned Counsel wherein, in various judgments, it is held that the activity of cutting, welding, bending etc. do not amount to manufacture.
At the same time there are contrary judgments to each other and the matter was decided by the Larger Bench in the case of MAHINDRA & MAHINDRA LTD. VERSUS CCE., AURANGABAD, CHANDIGARH, KANPUR & CHENNAI [2005 (11) TMI 103 - CESTAT, NEW DELHI]. However, the specific activity has to be looked into in each and every case, then only this judgment can be applied. Therefore, in this undisputed fact the issue involved is of interpretation of the term manufacturer. Therefore, no malafide intention can be attributed to the appellant. Secondly, the appellant who were registered under service tax and discharging the service tax liability on the very same activity which as per department is amount to manufacture.
Once the appellant have under bonafide belief assessed the activity as service and paid the service tax and have been filing their ST-3 return regularly. It was open to the department to question about the nature of activity and can raise the demand if at all they are of belief that the activity is amount to manufacture well within the normal time. In this position, nothing prevented the department to issue show cause notice within the normal period. Therefore, since there is absolutely, no suppression of fact and malafide intention, the demand is hit by limitation. The period of demand is 2011-2013 and show cause notice was issued almost after 3-4 years i.e. on 18.01.2017. Accordingly, entire demand is beyond the normal period. Hence, the same is not sustainable on the ground of limitation itself.
Since, the appellant have no malafide intention and they have not suppressed any fact from department with intent to evade payment of duty. For the same reason, no penalty under Section 11 AC is imposable. Accordingly, the demand is set aside only on the ground of limitation without giving the conclusive findings on the merit i.e. whether the activity amounts to manufacture and otherwise.
The impugned order is set aside, appeals are allowed.
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2024 (11) TMI 1175
Demand of Excise duty with interest and penalty - mis-classification of products as under Chapter Heading 8707 instead of Chapter Heading 8704 - manufacturing goods for mounting on duty-paid Chassis - benefit of N/N. 6/2006-CE dated 01.03.2006 Sl.No.87 as amended by another N/N. 12/2012-CE dated 17.03.2012 Sl.No.334 - Extended period of limitation - HELD THAT:- In MESSRS DISHA ENGINEERS VERSUS C.C.E. -AHMEDABAD-I [2022 (5) TMI 476 - CESTAT AHMEDABAD] and M/S AMCL MACHINERY LTD VERSUS COMMISSIONER OF CUSTOMS & C. EX. [2019 (8) TMI 250 - CESTAT MUMBAI], the assessee has classified their products under Chapter Heading 8704 and claimed exemption under Notification No.6/2006-CE dated 01.03.2006 Sl.No.87 as amended by another Notification No.12/2012-CE dated 17.03.2012 Sl.No.334, which is not the case in hand. The appellant admittedly classified their products under Chapter 8707 instead of 8704. In that circumstances, the cases relied upon by the ld.Counsel for the appellant, are not applicable to the facts and circumstances of the case.
But the appellant agreed upon that as they were filing ER-1 Returns regularly and classified their product under Chapter Heading 8707 claiming exemption Notification No.6/2006-CE dated 01.03.2006 Sl.No.87 as amended by another Notification No.12/2012-CE dated 17.03.2012 Sl.No.334, the extended period of limitation is not invokable.
In that circumstances, the extended period of limitation is not invokable in this case. Therefore, the demand pertaining to the extended period of limitation is dropped and in the facts and circumstances of the case, no penalty is imposable on the appellant.
The demand pertaining within the limitation is confirmed. Accordingly, the same shall be paid by the appellant along with interest, (if not paid) within 30 days from the date of receipt of this order - No penalty is imposable on the appellant - the appeal is disposed off.
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2024 (11) TMI 1174
CENVAT Credit of input services relating to captive mines - Input Service Distributor (ISD) - distribution of credit by the captive mines to the manufacturing units of the SAIL through ISD invoices - HELD THAT:- The issue is no longer res integra as this Tribunal has already decided the same issue in their own case for the period June 2016 to June 2017, in M/S STEEL AUTHORITY OF INDIA LIMITED VERSUS COMMISSIONER OF CGST & CENTRAL EXCISE, BOLPUR [2023 (12) TMI 1062 - CESTAT KOLKATA], wherein, on similar facts, it has been held by this Tribunal that the Appellant is entitled to avail CENVAT Credit of input services relating to captive mines. The present appeal covers the period 2006-07 to 2011-12 (up to June 2012), for the same unit.
The mines and the Appellant’s manufacturing unit belongs to one legal entity, which is engaged in manufacture of dutiable goods. Therefore, the observation given by the Ld. Commissioner that distribution of credit by the mines is in contravention of Rule 7(b) of the CENVAT Credit Rules is legally not tenable. Thus, the distribution of credit by captive mines as ISD is in accordance with the provisions of law.
The demands of service tax along with interest and penalty confirmed in the impugned order set aside - appeal allowed.
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2024 (11) TMI 1130
Condonation of delay of 268 days in filing the Civil Appeals - liability to pay NCCD on Dumper chassis as an intermediate product - It was held by CESTAT that 'the issue as to whether the exemption under notification 67/95 is available to NCCD is to be answered in the affirmative and in favour of the assessee.' - HELD THAT:- There are no good reason to interfere with the common impugned orders in M/S. KOMATSU INDIA PVT. LTD. VERSUS THE COMMISSIONER OF GST & CENTRAL EXCISE [2023 (11) TMI 305 - CESTAT CHENNAI] - The Civil Appeals are, accordingly, dismissed on the ground of delay as well as on merits.
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2024 (11) TMI 1129
Availment of inadmissible credit - mala fide intention on the part of the assessee or not - invocation of extended period of limitation under proviso to Section 11A of the Central Excise Act, 1944 - HELD THAT:- Circular dated 2-11-2023 issued by the Ministry of Finance, Department of Revenue, Central Board of Indirect Taxes & Customs states that in exercise of the powers conferred under Section 131BA of the Customs Act, 1962 and in partial modification of earlier instructions issued in F.No.390/Misc./163/2010-JC dated 17.08.2011, the Central Board of Indirect Taxes and Customs has fixed the monetary limit below which appeal shall not be filed in the CESTAT, High Court and the Supreme Court. So far as this Court is concerned, the monetary limit fixed is Rs.2 Crore.
Appeal disposed off.
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2024 (11) TMI 1128
100% EOU - Refund/rebate of service tax paid - place of removal - export of goods as per N/N. 41/2012-ST dated 29.6.2012 - refund claims were rejected on the common ground that the gamma sterilization service was undertaken much before the time of export and hence does not fall under the category of ‘services that have been used beyond the place of removal for the export of the said goods’ mentioned under Explanation (A) (i) of Notification No.42/2012-ST dated 29.06.2012 - HELD THAT:- The amendment has widened the ambit of the term 'specified service'. The appellant has drawn attention to the Tribunal judgment in the case of M/S BHARAT MINES & MINERALS VERSUS COMMISSIONER CENTRAL GOODS & SERVICE TAX, DEHRADUN. [2020 (2) TMI 1007 - CESTAT NEW DELHI] which held that rebate of service tax paid on Chartered Accountant Service is to be allowed since the said service was admittedly used beyond the place of factory and further held that the wordings of the notification make it very clear that the question of the service being rendered pre or post export has no significance.
Swatch Bharat Cess and Krishi Kalyan Cess - HELD THAT:- This issue stands settled by the Hon'ble CESTAT, Kolkata in the case of M/S. MMTC LIMITED VERSUS COMMISSIONER OF CGST & CX, BHUBANESWAR COMMISSIONERATE [2023 (10) TMI 815 - CESTAT KOLKATA] wherein it has been held that the assessee is entitled for refund of Swatch Bharat Cess and Krishi Kalyan Cess in terms of notification No. 41/2012-ST dated 29.06.2012.
Refund paid on courier services - HELD THAT:- The Commissioner (Appeals) had allowed this very issue in the appellant’s own case M/S. KANAM LATEX INDUSTRIES PVT. LTD. VERSUS COMMISSIONER OF GST & CENTRAL EXCISE, TIRUNELVELI [2024 (1) TMI 1055 - CESTAT CHENNAI]. The Department has accepted the said order-in-appeal and no further appeal has been filed before the Tribunal against the grant of refund of service tax paid on courier services.
It is submitted that the appropriation of an amount of Rs. 1,24,593/- is clearly without authority of law and therefore they are entitled to the refund of the said amount wrongly appropriated. In the facts and circumstances stated, the appropriation of amounts made and covered by the above-mentioned appeals, are set aside.
The impugned order set aside - appeal allowed.
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2024 (11) TMI 1127
Appeal dismissed for non compliance with Section 35F of Central Excise Act - HELD THAT:- There are no justification for adjourning the matter.
The Appeal is dismissed for non prosecution in terms of Rule 20 of CESTAT Procedure Rules, 1982.
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2024 (11) TMI 1126
Dismissal of appeal for non prosecution in terms of Rule 20 of CESTAT Procedure Rules, 1982 - HELD THAT:- There are no justification for adjourning the matter beyond three times which is the maximum number statutorily provided.
The Appeal is dismissed for non prosecution in terms of Rule 20 of CESTAT Procedure Rules, 1982.
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2024 (11) TMI 1125
Recovery of CENVAT Credit with Interest and penalty - duty paying documents - endorsed Bill of entry - valid document for availing cenvat credit as per Rule 9(1) of Cenvat Credit Rules, 2004 or not - HELD THAT:- In appellant’s own case REMIDEX PHARMA PVT LTD VERSUS COMMISSIONER OF CENTRAL EXCISE, SERVICE TAX AND CUSTOMS, BANGALORE-II [2018 (4) TMI 471 - CESTAT BANGALORE], this tribunal for earlier period observed that 'the impugned order denying the CENVAT credit only on the ground of endorsed Bill of Entry is not sustainable in law.'
The impugned orders are set aside and the appeals are allowed.
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2024 (11) TMI 1124
Time Limitation - Recovery of differential duty with interest and penalty - whether the demand is barred by limitation? - whether the demand is barred by limitation or not - HELD THAT:- It is found that initially the view of the department was that the clearance of samples free from the factory leviable to duty and the value should be determined adopting Rule 8 of Central Excise Valuation (Determination of Price of Excisable Goods) Rules, 2000. Later, the same was reconsidered and it was clarified that the proper rule for determination of value of free samples cleared from the factory would be Rule 4 of Central Excise Valuation (Determination of Price of Excisable Goods) Rules, 2000.
The Hon’ble High Court of Bombay in the case of INDIAN DRUGS MANUFACTURER'S ASSOCN. VERSUS UNION OF INDIA [2006 (9) TMI 94 - BOMBAY HIGH COURT] case held that the value of physician samples cleared free be determined by adopting Rule 4 of Central Excise Valuation (Determination of Price of Excisable Goods) Rules, 2000.
There was no suppression or misdeclaration on the part of the appellant with intent to evade payment of duty. Consequently, the demand with interest be limited to the normal period of limitation. Under these circumstances, penalty is also not imposable.
The impugned order is modified to the extent of setting aside the demand for the extended period of limitation and the demand for normal period is upheld with interest. As issue pertains to interpretation of law, no penalty is imposable. Appeal is partly allowed.
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2024 (11) TMI 1079
Clandestine removal - allegation of shortage of raw material for clearance of the finished goods - Procedural lapses in investigation and stock verification or not - Revenue submits that the respondent, since initiation of the investigation, has only tried to hide their incriminating activities by citing the shortcomings of the Departmental officers and have tried to divert the entire attention towards the allegedly procedural lapses during the investigation - HELD THAT:- It is an admitted position that the investigation which has been carried out, lacks the following of proper procedure. To allege clandestine removal of goods, proper procedure was required to be followed. During the course of investigation, it is a position on the record, that physical verification of the stock was not done; it was only done on eye-estimation basis and the alleged shortage of raw material has not been supported by any tangible evidence.
Although allegation of clandestine clearance thereof has been raised by the investigating team, the suppliers of raw material were examined and no discrepancies could be found in the raw materials supplied to the respondent. Before adjudication, the adjudicating authority had sought a report from the jurisdictional Range Officer, who had also not found any discrepancy in the activity of the respondent - Moreover, it has been alleged that the respondent has manufactured the final product and cleared the same clandestinely, but while doing so, the Revenue on the one side alleges that there was a shortage of raw material and on the other side, alleges clandestine clearance of finished goods, all the while without bringing any evidence on record to show as to from where the respondent procured raw materials to manufacture the goods which were alleged to have been cleared clandestinely. The investigating team has not alleged any excess consumption of electricity, shown as to how the goods were transported or as to how much labour was employed.
The observations made by the ld. adjudicating authority in the impugned order agreed upon. It is also seen that no tangible evidence in support of the allegation of shortage of raw material for clearance of the finished goods has been brought on record by the Revenue, other than the statement recorded during the investigation of Shri Munnoo Prasad Jaiswal, the authorized signatory of the respondent.
The charge of clandestine removal of the goods and shortage of raw materials is not sustainable - There are no infirmity in the impugned order and the same is upheld - the appeal filed by the Revenue is dismissed.
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2024 (11) TMI 1078
Denial of CENVAT Credit on the basis of shortages shown in the Cost and Audit Report - HELD THAT:- Despite the fact that shortage of inputs was noticed and recorded in the Cost Audit Report, Appellant has attributed those shortages to different factors which were bound to happen when theoretical calculation was made without actual physical verification of stock, as there could be wrong entries of input, variation in weighment of input with that of rounded up figures available in the bills or that of wrong accounting but the ground taken for shortages including theft, if noticeable, would lead to different consequence.
However, in the instant case, taking note of the percentage of shortages that was noticed for different financial years, when the procurement of material were too large the value of which runs in crores, such negligible shortages could be a natural consequence for which even protection is granted by the Hon'ble Supreme Court, as found in M/s. Maruti Udyog Limited case [2004 (6) TMI 155 - CESTAT, NEW DELHI] that if shortages is very negligible and there is no allegation of clandestine removal or even no proof of excess clearance of final products or inputs as such, availment of credit by the manufacturer need not be interfered with.
In Appellant’s case except for FY 2009-10 percentage of shortages in rest of years, to which extended period was unnecessarily invoked, since in its preceding 3 years shortages were even much lesser than the shortages noted in M/s. Maruti Udyog Limited case (0.24%), denial of credit to the Appellant was improper - It is required to set aside the order passed by the Commissioner in due obedience to the judicial precedent set by the Hon'ble Supreme Court of India.
The order passed by the Commissioner of Central Excise, Pune-I dated 30.10.2013 is hereby set aside - Appeal allowed.
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2024 (11) TMI 1077
Classification of goods - unglazed ceramic wall tiles or burnt clay building bricks/tiles - Department is of the view that the impugned goods manufactured by the appellant are unglazed ceramic wall tiles classifiable under sub-heading 6907 10 90 of Central Excise Tariff Act, 1985, while the claim of the appellant is that their product is burnt clay building bricks/tiles falling under heading 6904 10 00 & Roofing tiles tall under heading 6905 10 00 of Central Excise Tariff Act, 1985 - Availability of SSI exemption under Notification No. 1/2011-CE.
HELD THAT:- The issues involved in the present case are no more res integra and have been decided by the Appellate Authority as well as by the Adjudicating Authority and also by this Tribunal in favour of the appellant. In this regard, reference made to the decision in the case of M/s Modern Bricks & Engg. Works, Derabassi, whereby the Appellate Authority has allowed the appeal of the assessee by vide O-I-A No. 137-138/CE/Appl/Chd-II/2013 dt. 05.04.2013.
Similarly, the Appellate Authority allowed the appeal of the appellant in the case of M/s Bharat Bricks Co., Village Fatehpur, Derabassi vide O-I-A No. 198/CE/Appl/Chd-II/2013 dt. 22.05.2013. Further, it is found that the Tribunal vide Final Order No. 61382/2016 dt. 16.09.2016 in the appellant’s own case [2016 (11) TMI 691 - CESTAT CHANDIGARH], has allowed the appeal of the appellant.
It is also found that the demand for the subsequent period i.e. 01.05.2014 to 31.12.2015, in the appellant’s own case, has also been dropped by the Additional Commissioner, Central Excise, Chandigarh-II vide Order-in-Original No. 37-38/CE/2016-17/ADC/CHD-II/SRM dt. 31.03.2017. All these orders passed by the various departmental authorities as well as the Tribunal have been accepted by the Revenue.
The impugned orders are not sustainable in law and therefore, the same is set aside - appeal allowed.
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2024 (11) TMI 1042
CENVAT Credit - capital goods - mobile service providers (MSPs) can claim CENVAT Credit on excise duties paid on mobile towers and prefabricated buildings (PFBs) or not - whether the credit so claimed can be used to pay service tax for the output services rendered by the MSPs? - HELD THAT:- Rule 3(1) of the CENVAT Rules enables a provider of taxable service to claim CENVAT credit on duties paid on any “capital goods” or “input” received in the premises of the service provider. Thus, if the mobile towers and prefabricated buildings, which are the items in issue here, qualify as “capital goods” or “inputs” received in the premises of the mobile service provider, the mobile service provider will be entitled to claim CENVAT credit which can be further used for paying service tax for the output services rendered by the mobile service provider.
In the light of the provisions of the CENVAT Rules, if it is held that towers and/or parts thereof and prefabricated buildings (PFBs) are “capital goods” or “inputs” used for providing output service within the meaning of the aforesaid CENVAT Rules, then CENVAT credit can be claimed on these items.
It appears that the definition of “goods” under the Sales of Goods Act, 1930 seems to be the basis of the term “goods” in other Statutes. Hence, we would primarily rely on the definition given in the Sale of Goods Act - the items in consideration viz., towers and prefabricated buildings are neither actionable claim nor money, nor do they come within the inclusive clause of the definition, viz., stocks, shares, growing crops, grass, and things attached to forming part of the land which are agreed to be severed before sale or under contract of sale.
In order to determine whether any property is movable or immovable, this Court, in the light of the statutory provisions has applied certain principles. It has also been noted that such determination may be done not based on a single test but after applying several criteria on the facts of each case.
In TRIVENI ENGINEERING & INDUS. LTD. VERSUS COMMISSIONER OF CENTRAL EXCISE [2000 (8) TMI 86 - SUPREME COURT], this Court applied the marketability test, in which it took the view that if the goods in question are capable of being taken into the market and sold, the same cannot be treated to be as immovable but movable property - This Court observed that “marketability” itself indicates movability of the property in issue.
In the case of Sirpur Paper Mills Ltd. [1997 (12) TMI 109 - SUPREME COURT], this Court again applied the test of marketability. The issue which arose for consideration in the said case was whether paper machines assembled at site were liable for duties under the Excise Act. It was the plea of the Assessee that since the machine was embedded in concrete base, it became an immovable property though embedding was for providing a wobble-free operation of the machine. This Court rejected the plea and held that merely because the machine was attached to the earth for efficient working and wobble- free operation, it did not per se render the said property immovable since the said machine can be sold in the market.
In the present case, while mobile tower cannot be shifted to another location without dismantling it, it is to be noted that mobile tower itself was bought and brought in a completely knocked-down (CKD) or semi-knocked-down (SKD) condition and it was erected and installed at the site after assembling the parts. If the said mobile tower is to be shifted to another location, it obviously has to be dismantled and restored to its SKD or CKD condition and thereafter re-erected, which however, would not entail any damage to it.
There can no dispute that if the newly set up BTS/BSC is relocated to another site it may entail certain damages. However, what is important to be noted is that the damage is qua the BTS/BSC or cables connecting the various components, but not the tower itself or PFB with which we are concerned. If the tower or the PFB can be dismantled and relocated in another site without causing any damage to either the tower or PFB, the mobility or the marketability of these items is retained. Thus, as far as the tower and PFBs are concerned, these exhibit the character of a movable property.
Thus, merely because certain articles are attached to the earth, it does not ipso facto render these immovable properties. If such attachment to earth is not intended to be permanent but for providing support to the goods concerned and make their functioning more effective, and if such items can still be dismantled without any damage or without bringing any change in the nature of the goods and can be moved to market and sold, such goods cannot be considered immovable.
The PFB houses other BTS equipment and alternative electricity source in the form of diesel generators and other equipment to provide alternative and uninterrupted power supply to the antenna so that in the event of failure of main power supply, the generator can instantly provide backup electricity supply to the antenna and BTS. The PFBs house electric cables, other equipment related to antenna, BTS and generator. Thus, PFBs enhance the efficacy and functioning of mobile antenna as well as BTS and accordingly, PFBs can also be considered as accessories to the antenna and BTS which are “capital goods” falling under Chapter 85 of the Schedule to the Central Excise Tariff.
Having held that the tower and pre-fabricated buildings (PFBs) are “goods” and not immovable property and since these goods are used for providing mobile telecommunication services, the inescapable conclusion is that they would also qualify as “inputs” under Rule 2(k) for the purpose of credit benefits under the CENVAT Rules - Appeal disposed off.
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2024 (11) TMI 1041
Eligibility of SSI exemption Notification No.08/2003-CE dated 01.03.2003 - clubbing of clearance value of two units - failure to consider various submission - violation of principles of natural justice - HELD THAT:- From the finding of this Tribunal, it can be seen that the Ld. Commissioner (Appeals) was directed to particularly, look into the financial transaction, day to day management etc. to arrive at conclusion of relationship between the two units.
It was also observed that the Commissioner (Appeals) is supposed to reassess the evidences as brought out on record and also referred to specifically in the grounds of appeal and thereafter, applying the principles of natural justice reconsider the eligibility of SSI exemption Notification No.08/2003-CE. From the perusal of the impugned order, we find that the appellant have made multiple submissions such as limitation, discrepancy in issuance of the show cause notice and various records showing that there is no financial flowback and both the units are working separately and particularly, after certain stage, one factory was shifted to the different location. However, the Ld. Commissioner (Appeals) has not considered all this aspects in the proper perspective and passed the order without considering the various submissions and evidences produced by the appellant.
The request of the Ld. Counsel on behalf of the appellant for remanding the matter is just and proper. Accordingly, the impugned order is set aside and the appeal is allowed by way of remand to Commissioner (Appeals) for passing a fresh order.
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2024 (11) TMI 1040
Liability to pay 6% duty on by product namely Ammonium Sulphate - contravention of condition of Notification No.01/2011- CE - availment of Cenvat Credit on the inputs used in the Ammonium Sulphate - HELD THAT:- It is found that in the present case the demand of differential duty of 5% i.e. as against the 1% duty paid by the appellant and 6% duty was demanded on the ground that appellant have availed the Cenvat Credit on the input and used in the Ammonium Sulphate, hence, the Ammonium Sulphateis liable to duty at the rate of 6% instead of 1%.
It is found that in the facts of the present case, Ammonium Sulphate is generated unavoidably as by product, in case of by product it cannot be said that any input stage credit was availed even if, the by product is cleared at nil rate of duty Cenvat credit cannot be demanded only on the pretext that the entire input on which the credit was taken has been used in the manufacture of the final product and not in manufacture of by product. Therefore, the exemption Notification No.01/2011which carries the condition of non availment of Cenvat Credit on input cannot be denied.
This issue is no longer res-integra, in the appellant’s own case, HINDUSTAN CHEMICALS COMPANY VERSUS COMMISSIONER OF C.E. & S.T. -SURAT-II [2024 (5) TMI 459 - CESTAT AHMEDABAD] it was held that 'since the issue has been settled that Ammonium Sulphate being a by-product arising in the course of manufacture of final product, the demand under Rule 6(3) is not applicable. Accordingly, In the present case also being a similar issue, demand is not sustainable.'
In view of the above decision in the appellant’s own case, it has been held that the reversal under Rule 6(3) of Cenvat Credit Rules in respect of Ammonium sulphate being by product is not required to be made. This has been held with a view that Cenvat Credit on the input cannot be said to have been availed when any by product is cleared. Therefore, in view of the above settled position, the demand of excise duty on the Ammonium Sulphate which was made on the basis that the Cenvat Credit was availed on the inputs is not sustainable.
The impugned order is set aside - the appeal is allowed.
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2024 (11) TMI 989
CENVAT Credit on the invoices issued by M/s. Rashmi Metaliks Ltd. and M/s. Neo Metaliks Ltd. - Evasion of Central Excise duty by way of willful suppression of material facts and intentional misuse of CENVAT Credit facility by adopting the modus operandi of non-receipt of their primary raw materials, namely Pig Iron in their factory and non- use of the same in the manufacture of final products - Levy of penalty - HELD THAT:- The whole of the case has been made out on the basis of the statement of appellant No.1 who stated that he is dealing with excise and VAT paid goods and not registered with the central excise department and clearing goods on their challans and no cenvat credit has been availed by the receiver of the goods as no excise paid challan or invoice has been issued by appellant No.1. During the course of investigation, statement of the Authorized Representative of the appellant No.3 was recorded and nowhere he has admitted that they are having any relation or have ever transacted with appellant No.1 and the goods which have been received by them have been used in manufacturing of their final product, which ultimately suffered duty. These facts are not in dispute.
In the absence of all the evidences it cannot be said that appellant No.3 has not received the goods. Moreover, the case against the appellant No.2 and 3 has been made on the basis of statement of appellant No.1. Demand cannot be raised on the basis of third party statement without any corroborative evidence thereon.
The cenvat credit in this case cannot be denied to the appellant No.3, therefore, no penalty can be imposed on the appellant No.2. Consequent to that, penalty on the appellant No.1 also cannot be imposed.
The impugned order is set aside - appeal allowed.
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2024 (11) TMI 988
CENVAT Credit on removal of waste and scrap as such - after use of plant and machinery removal of the same as used plant and machinery attract duty by deducting the depreciation as provided in Rule 3(5) of Cenvat Credit Rules or will be treated as removal of waste and scrap of capital goods attracting duty on transaction value in terms of Rule 3(5A) of Cenvat Credit Rules - denial of credit on the ground that M.S. Window Section cleared as such without any manufacturing process carried on such M.S. Window Section - shortage of 30.123 MT of Billets which was used in the furnace and subsequently dismantled and cleared in June, 2008.
Whether after use of plant and machinery removal of the same as used plant and machinery attract duty by deducting the depreciation as provided in Rule 3(5) of Cenvat Credit Rules or will be treated as removal of waste and scrap of capital goods attracting duty on transaction value in terms of Rule 3(5A) of Cenvat Credit Rules? - HELD THAT:- It is found that merely because the plant & machinery was sold in the Metric Ton and the buyer is the scrap dealer that alone cannot establish that the plant and machinery sold by the appellant is in the form of waste and scrap. As per the invoices raised by the appellant it is observed that in some of the invoices, the description clearly shown as old and used iron scrap. However, in some of the case it is declared as old and used machinery.
From the two sample invoices, it is observed that some of the goods were cleared as waste and scrap and some of the capital goods were cleared as old and used machinery without mentioning steel scrap. Therefore, the entire matter needs to be reconsidered after verification of facts on the basis of each invoice and wherever, the description of the capital goods is mentioned as waste and scrap, the same is liable to excise duty on the transaction value and in case of description mentioned as old and used capital goods the same shall be liable to duty after allowing the depreciation as prescribed in the Rules. The adjudicating authority shall also consider the submission of the appellant that at the relevant time there was no recovery proceeding which was brought in this statute only by Notification No.03/2013- C.E. (N.T.) dated 01.03.2013.
Whether this Cenvat Credit is liable to be denied on the ground that M.S. Window Section cleared as such without any manufacturing process carried on such M.S. Window Section? - HELD THAT:- It is the admitted fact that the appellant have cleared the M. S. Window Section involving Cenvat Credit of Rs.19,86,317/-on payment of duty amounting toRs.27,93,234/-, therefore, the amount of Cenvat Credit of Rs.19,86,317/-stands reversed/ paid by the appellant. On this ground the demand of Rs.19,86,317/- and consequent penalty and interest if any shall not sustain.
Whether demand of Cenvat Credit is correct on the ground of shortage of 30.123 MT of Billets which was used in the furnace and subsequently dismantled and cleared in June, 2008? - HELD THAT:- It is found that the stand of the appellant is that at the time of use of billets in the foundation of the furnace, they have reversed the Cenvat Credit. However, no evidence in respect of such reversal was brought here. Therefore, this factual aspect also needs to be verified by the adjudicating authority while passing denovo order.
The matter relates to the demand of Rs.54,38,305/- and Rs.Rs.1,04,249/-,it is remanded to the adjudicating authority and the demand of Rs.19,86,317/- on M.S. Window Section is set aside. The appeal is disposed of.
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