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Central Excise - Case Laws
Showing 201 to 220 of 81789 Records
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2025 (1) TMI 1254
Refund of Excise duty paid under protest - appellant's activity of fabricating transmission towers amounting to manufacture or not - time limitation under Section 11B of the Central Excise Act - HELD THAT:- The amount collected by way of Central excise duty was illegal as the activity itself did not involve any manufacture and the same cannot be allowed to be retained by the Government. On the principle that tax can be collected only by authority of law, the observations of the Tribunal in the case of COMMISSIONER OF CUSTOMS, DELHI VERSUS POLYGLASS ACRYLIC MFG. CO. P. LTD. [2011 (6) TMI 305 - CESTAT, DELHI] that when Central excise duty is collected illegally the same cannot be retained by the Government supports the case of the appellant. Such is the mandate of Article 265 of the Constitution of India.
Once it is held that the Government is not entitled to retain the amount deposited by the appellant, the next issue is regarding the time limit for reversing the said amount to the assessee. The Madras High Court in M/S. NATRAJ AND VENKAT ASSOCIATES VERSUS ASSISTANT COMMISSIONER, SERVICE TAX [2009 (10) TMI 36 - MADRAS HIGH COURT] and the Punjab and Haryana High Court in INDIAN OIL CORPORATION LTD. VERSUS COMMISSIONER OF C. EX., NEW DELHI [2010 (4) TMI 625 - PUNJAB & HARYANA HIGH COURT] held that once the tax was not payable at all, time limit does not apply for filing the refund of the said amount.
The other issue that ‘under protest’ was not made in the prescribed format, is irrelevant. It is a settled principle that on mere procedural technicalities, the relief cannot be denied, which otherwise is available to a party. For the period prior to the introduction of Rule 233B (01.06.1981), there was no specific provision prescribing any specific mode of endorsing ‘under protest’ and, therefore, the appellant cannot be non-suited for not making proper endorsement.
The refund claim cannot be rejected for non-compliance with the provisions of Rule 233B. The endorsement ‘under protest’ on the gate passes by the appellant is sufficient to say that the appellant paid the duty ‘under protest’ and hence, cannot be denied the refund of the amount illegally collected by the Department.
The Apex Court in SANDVIK ASIA LIMITED VERSUS COMMISSIONER OF INCOME-TAX AND OTHERS [2006 (1) TMI 55 - SUPREME COURT] with reference to the provisions of the Income Tax Act has observed that in view of the express provisions of the Act the assessee is entitled to compensation by way of interest on the delay in the payment of amounts lawfully due to the appellant which were wrongly withheld by the Department for an inordinate long period. The Act itself recognised in principle, the liability of the Department to pay interest where the amount deposited by the assessee is unduly retained.
Conclusion - i) Duty was collected by the Department under mistake of law for which no time limit applies and, therefore, the refund claim on the ground of delay has been wrongly rejected. ii) The endorsement on the gate passes, ‘under protest’ is sufficient to indicate that the appellant has paid the duty ‘under protest’ and hence, the refund claim cannot be rejected as time barred. iii) The retention of the amount which is in the nature of revenue deposit would be wholly unjustified being violative of Article 265 of the Constitution. iv) The appellant is entitled to the refund claim along with interest @ 12% per annum from the date of refund claim was rejected.
The impugned order is set aside and the Department is directed to release the refund along with interest to the appellant - Appeal allowed.
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2025 (1) TMI 1253
Recovery of Central excise Duty with interest and penalty - duty on intermediate product PPFMY which arises during the course of manufacture of the finished products - confirmation of duty with interest and penalty - HELD THAT:- As the Tribunal has in Appellant’s own case M/S ASMA TRADERS VERSUS CCE&ST, KANPUR [2018 (1) TMI 1535 - CESTAT ALLAHABAD] held that PPMFY arises during the continuous manufacturing process of Narrow Woven Fabric is not marketable and hence no goods/excisable goods comes into existence. The claim of the Appellant in the present proceedings that they were paying duty on the intermediate product goes contrary to this order as Appellant can pay duty only on the goods/ excisable goods which come into existence and are subject to duty.
Undisputedly the Appellant has taken a cenvat credit on inputs used in the manufacture of finished goods. In terms of the condition of Exemption N/N. 30/2004-Central Excise the benefit of said Notification would not be available to them, and they are required to pay central excise duty on the finished goods - the demand has been confirmed against the Appellant without allowing the benefit of the duty already paid by them by treating PPMFY as excisable goods. The quantum demand confirmed needs to be worked out after making adjustment for the duty already paid.
Conclusion - The demand for excise duty on the final product, Narrow Woven Fabric, due to the appellant's availing of CENVAT credit on inputs upheld. The penalty imposed under Section 11AC(1)(a) was set aside.
Matter is remanded for re-quantification of the demand of duty, giving credit of the duty already paid - appeal allowed by way of remand.
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2025 (1) TMI 1252
Penalties u/r 26(2) of the Central Excise Rules, 2002 - denial of certain Cenvat credit on the ground that the said credit was taken against the material which were never received by them or used by them for production of the finished goods - HELD THAT:- Rule 26(2) was introduced by Notification No.8/2007-CE(NT) dated 01.03.2007. From the plain reading of the said notification it appears that Rule 26 as is existed prior to the said amendment was reframed at 26(1) and 26 (2) provided for imposition of penalties under the said Rule the provisions specified therein. The said rule being a separate new rule inserted could not have been said to be in respect of the persons covered by Rule 26 (1) which apparently was rule 26 prior to the existence, prior to the date of insertion. The provisions of said rule 26 (2) could not have been invoked for the imposition of penalties on the persons whose offences were specified in terms of Rule 26.
There is not even iota of allegation or evidence to show that appellants were concern with handling, removing of any goods which were liable for confiscation. On the contrary, the case against the appellants is that there were paying duties, credit of which was being taken by M/s Accurate Meters Ltd.
In the case of COMMISSIONER OF CENTRAL EXCISE, CHANDIGARH VERSUS SURYA ISPAT UDYOG [2017 (4) TMI 1298 - CESTAT CHANDIGARH] has held that 'penalty provision for facilitating others in taking credit or issuance of invoice without actual supply of material has been inserted w.e.f. 1-3-2007 by inserting sub-rule (2) of Rule 26 of Central Excise Rules with the issue of Notification No. 8/2007-C.E. (N.T.), dt. 1-3-2007 and during the relevant period there was no provision under law for imposition of penalty for issuance of invoices without actual supply of material.'
Conclusion - Penal provisions cannot be applied retrospectively unless explicitly stated in the statute. Rule 26(2) of the Central Excise Rules, 2002, cannot be applied to conduct predating its enactment. Rule 25 requires specific involvement with goods liable for confiscation, which was not demonstrated in this case.
The duty paid goods could not have been held liable for confiscation as the basic ingredient for invoking Rule 25 are missing in the cases against the appellant. The penalties imposed under Rule 25 also set aside.
Appeal allowed.
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2025 (1) TMI 1149
Rate of interest on the refund amount collected during investigation - whether the appellant is entitled to interest on the refund amount @6% per annum as granted by the Commissioner (Appeals) or @12% per annum as claimed by the appellant? - HELD THAT:- In view of the various decisions of the High Courts and various Benches of the Tribunal wherein it has been consistently held that interest on refund of deposit made during the investigation is required to be computed @12% per annum. The jurisdictional High Court of this Tribunal has already held that rate of interest applicable in such cases is 12% per annum as held in the cases of COMMISSIONER OF CENTRAL EXCISE, PANCHKULA VERSUS RIBA TEXTILES LTD. [2022 (5) TMI 1531 - PUNJAB AND HARYANA HIGH COURT] and M/S. SUNRISE IMMIGRATION CONSULTANTS PVT. LTD. VERSUS UNION OF INDIA AND ORS. [2023 (6) TMI 411 - PUNJAB AND HARYANA HIGH COURT].
In view of the decisions of the Hon’ble High Courts in the cases cited wherein the Hon’ble High Court has granted the interest @ 12% per annum, following the ratio of the decisions of the High Court and hold that the appellant is entitled to the rate of interest @ 12 % per annum on the amount deposited during investigation.
Conclusion - The appellant is entitled to an interest rate of 12% per annum on the refund amount deposited during the investigation. This conclusion was based on the consistent application of this rate in similar cases by various High Courts and the Tribunal itself.
The Original Authority is directed to compute the Interest @ 12% instead of @ 6 % as directed by the Commissioner appeal - Appeal allowed.
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2025 (1) TMI 1148
Benefit of exemption under N/N. 67/1995-CE dated 16.03.1995 - process amounting to manufacture or not - activity of preparation of ‘season’ - product has a shelf life and is marketable - appellant is engaged in the manufacture of finished leather - discharge of obligation in terms of Rule 6 of the CCR, 2001 by appellant or not - Whether the intermediary product ‘season’ manufactured and captively used by the appellant is eligible for the benefit of exemption under N/N. 67/1995?
HELD THAT:- The appellant is engaged in the manufacture and clearance of the goods both dutiable and exempted. From the contents of the notification it is also found that the intermediary product ‘season’ prepared in the factory of the appellant is covered under Column (1) of the Table and is used in or in relation to the manufacture of both types of final products covered under Column (2) of the Table of the notification. It is also an undisputed position that the appellant had not availed the Cenvat Credit of duty or tax paid on any inputs or input services or capital goods which were used in the manufacture of both exempted and dutiable goods. The fact that the appellant has not availed the Cenvat Credit shows that they had discharged the obligation as prescribed under Rule 6 of the Rules.
In arriving at the conclusion, that the appellant had discharged the obligation in terms of Rule 6 as no Cenvat Credit was availed, we are supported by the decisions as referred to by the learned Counsel for the appellant. In the case of AMBUJA CEMENT LTD. VERSUS COMMISSIONER OF CENTRAL EXCISE, CHANDIGARH [2015 (11) TMI 1413 - SUPREME COURT], the Apex Court considered the issue relating to the interpretation of the exemption notification no. 67/1995 with reference to the dutiability of the intermediary product ‘clinker’ obtained at the intermediary stage in the production of ‘cement’, which is exempted from the excise duty under the exemption notification no. 50/2003 dated 10.06.2003. The Apex Court, inter-alia observed 'The final products may be made out of the same product or out of different products. Clause (vi) does not contemplates that the manufacturer should manufacture only ‘one final product’ or that if he manufacturers only one product that product itself should be both dutiable and exempted. The basis adopted by the CESTAT that the same final product should be partly dutiable and partly exempt, is neither a requirement of clause (vi) nor a requirement of Rule 6.'
In the case of M/S. FUNSKOOL (INDIA) LIMITED VERSUS COMMISSIONER OF CENTRAL EXCISE & CUSTOMS, GOA [2016 (12) TMI 1267 - CESTAT MUMBAI] the adjudicating authority had denied the exemption under notification no. 67/1995 in respect of packing boxes used captively for manufacture of exempted goods on the ground that the appellant have not discharged the obligation as provided under Rule 6 of the CCR, 2001. In this context, the Tribunal noticed that the appellant therein had not availed the Cenvat Credit in respect of any of the inputs used either in the final product or in the intermediate product, i.e. packing boxes and therefore, concluded that the obligation in terms of Rule 6(1) stood discharged and they were entitled to the benefit of the exemption N/N. 67/195.
Similar observations have been made in SPRAY KING AGRO EQUIPMENT PVT LTD AND HITESH P DUDHAGRA VERSUS C.C.E. & S.T. -RAJKOT [2022 (5) TMI 564 - CESTAT AHMEDABAD] that exemption under notification is available to the intermediary goods even if the final product is exempted, provided the assessee discharges the obligation prescribed under Rule 6 of the CCR, 2001. In the context, it was observed that the appellant during the impugned period was not registered with the Central Excise Department, hence, has not availed the Cenvat Credit in respect of any of the inputs used either in the final product or in the intermediate product i.e. Brass and therefore, the condition of sub-rule (1) of Rule 6 stands complied with.
Conclusion - Since the appellant herein had not availed the Cenvat Credit, they had discharged the obligation under Rule 6(1) and were therefore, entitled to the benefit of the exemption notification no. 67/1995.
Appeal allowed.
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2025 (1) TMI 1092
Failure to pay/reverse the amount of credit availed on input services used in the manufacture of exempted goods - HELD THAT:- This Tribunal finds that a division bench of this Tribunal, in the case of SIVARAJ SPINNING MILLS PVT. LTD. VERSUS COMMISSIONER OF GST & CENTRAL EXCISE, MADURAI [2024 (8) TMI 990 - CESTAT CHENNAI], in a similar fact situation of the appellant therein clearing cotton yarn on payment of duty under Notification No. 29/2004-CE dated 09.07.2004 and clearing cotton yarn at nil rate as per Notification No. 30/2004 – CE dated 09.07.2004, simultaneously, after discussions, has rendered the decision in favour of the appellant therein holding 'the credit availed on input services is eligible and the contention of the Department that the credit has to be reversed is against the provisions of law.'
Conclusion - The goods exported under bond are exempt from the reversal of CENVAT credit and that CENVAT credit can be availed on input services used in the manufacture of such goods.
The impugned order in appeal is hence set aside. The appeal is allowed.
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2025 (1) TMI 1086
Recovery of Cenvat credit availed on the basis of invalid and improper documents - credit availed on the basis of invoices issued by bank branches and photocopies of invoices - denial of Cenvat Credit on the basis of carbon copy/ extra copy of invoices - invocation of extended period of limitation.
Credit availed on the basis of invoices issued by bank branches and photocopies of invoices - HELD THAT:- The head office of M/s Indian bank at Chennai is centrally registered with the service tax department for banking and Financial Services and were complying with the prescribed statutory formalities. As the Appellants submitted the Certificates/Statements of Service Tax collected issued by M/s Indian Bank from its Branches at Coimbatore and Mecheri referring to Centralized Accounting System at their Head Office which contain all the relevant particualrs required in terms of the proviso to Rule 4A of the Service Tax Rules, which are valid documents in terms of Rule 9(1) (f) of the Cenvat Credit Rules, 2004 for availing Cenvat credit., it is opined that the denial of Cenvat Credit is not justified, more particularly when the impugned order had completely ignored provisions of Rule 4A of the Service Tax Rules and the Proviso to Rule 9(2) of the CENVAT Credit Rules, 2004.
Availment of Cenvat Credit on the strength of xerox copy of invoice - HELD THAT:- In similar circumstances various courts/ Tribunals have decided the issue in favour of the Appellants and allowed Cenvat Credit - In the case of SHIVAM ELECTRICAL INDUSTRIES VERSUS UNION OF INDIA [2018 (2) TMI 816 - JAMMU AND KASHMIR HIGH COURT] it was held that 'The aforesaid Rule (Rule 9 of CCR) in our considered opinion nowhere provides that Cenvat credit cannot be availed on the basis of photocopy of the documents especially when the respondents have not disputed the correctness of the contents of the photocopies of the invoices produced by the petitioner. From the perusal of the certificate issued by the Superintendent, Customs and Central Excise, Range-III, Division-I, Ghaziabad, it is evident that the excise duty has been duly paid by the petitioner'.
Conclusion - The documents issued by banking companies containing requisite particulars are valid for availing Cenvat Credit. The Appellant is entitled to avail the Cenvat Credit based on Certificates/ statements issued by M/s. Indian Bank and based on the photocopies of invoices in the facts of this appeal.
Appeal allowed.
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2025 (1) TMI 1085
Denial of the benefit of exemption under N/N. 10/97-CE dated 01.03.1997 on for aircraft parts supplied to specified research institutions - goods fall under the specified categories in the notification or not - suppression of facts or not - levy of penalty u/r 25 of CER, 2002 - HELD THAT:- In fact on a perusal of the notification which provides for exemption to specified goods supplied to specified institutions, it is evident that in case of public funded research institution specified in Sl.No.1, when goods of the description provided in column (3) are supplied, condition specified in column (4) at (i) (a) stipulates that if the institution is a public funded research institution under the administrative control of the Department of Space or Department of Atomic Energy or the Defence Research Development Organisation of the Government of India and produces a certificate to that effect from an officer not below the rank of a Deputy Secretary to the Government of India in the concerned department to the manufacturer at the time of clearance of the specified goods. That is to say, if the institution is a public funded research institution under the administrative control of the Department of Space or Department of Atomic Energy or the Defence Research Development Organisation of the Government of India, all that the institutions specified in condition (i)(a) are required to do, is to produce a certificate simplicter from an officer not below the rank of a Deputy Secretary to the Government of India in the concerned department to the manufacturer at the time of clearance of the specified goods, stating that the institution is a public funded research institution under the administrative control of the Department of Space or Department of Atomic Energy or the Defence Research Development Organisation of the Government of India.
The Department cannot therefore, without adducing any positive evidence from any subject matter professional or expert stating that the goods in question do not satisfy the description of goods covered under the said notification, arbitrarily reject the claim for exemption duly supported by such certificates issued by the public funded research institutions that are specified in condition (i) (a) of the notification and when such institutions that are specified in condition (i)(b), additionally also certify that the goods are required for research purposes only.
In the Appellant’s own case, this Bench in M/S. TANEJA AEROSPACE AND AVIATION LTD. VERSUS THE COMMISSIONER OF CGST & CENTRAL EXCISE [2024 (7) TMI 1586 - CESTAT CHENNAI] has held that 'It is seen that the Commissioner (Appeals) for subsequent period has considered the very same issue and allowed the exemption observing that the gods which are in the nature of parts of air craft would fall under the category of "Engineering Goods". We do not find any grounds to take a different view We hold that the appellant is eligible for the exemption as per Notification No.10/1997-CE”.'
Conclusion - The Department has evidently erred in sitting in judgement over such certification without any proof or evidence to the contrary. The appellants are eligible for the exemption.
Appeal allowed.
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2025 (1) TMI 1034
Exemption under Notification 5/2006- CE dated 01.03.2006 (Sl.No.21) - gold bars manufactured in the factory at Hutti - classification of gold bar manufactured in their factory under tariff heading 71081200 of the First Schedule to the Central Excise tariff Act, 1985 - it was held by CESTAT that 'the Appellant are eligible to the benefit of the Sl. No. 21 of the exemption Notification No. 05/2006 CE dt.01.3.2006 till it has been amended by Notification 25/2011CE dt.24.3.2011.'
HELD THAT:- There are no good ground and reason to interfere with the impugned judgment/order; hence, the present appeals are dismissed.
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2025 (1) TMI 1033
Waiver of the penalty under Rule 26 of the Central Excise Rules, 2002 - all other noticees on whom penalty was imposed have also settled their case under the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 - failure of the appellants to file a declaration under the Sabka Vishwas Scheme constitutes a procedural flaw or not - HELD THAT:- The issue that once the main noticees have filed the declaration under the scheme and have deposited the duty required to be paid under the Sabka Vishwas Scheme, 2019 and Discharge Certificate has been issued by the department, thereafter the co-notices are eligible to seek waiver of penalty under the scheme by filing a declaration has been considered in series of decisions by this Tribunal.
Reliance placed on the latest decision dated 29.08.2024 in VK Aggarwal versus Commissioner of Central Tax, CGST & Central Excise, New Delhi [2023 (9) TMI 178 - CESTAT NEW DELHI] where it was held that 'without considering the directions given in the remand order and allowing cross examination, Commissioner has imposed penalties on the appellant, just for reason that the appellant did not settle the issue along with others under SVLDRS. Such approach of Commissioner cannot be justified. Even if the appellant has not approached under SVLDRS, Commissioner should have adjudicated as directed by Tribunal. No justification for imposition of penalty on reconsideration as per order of Tribunal is forthcoming.'
The present case is squarely covered by the aforementioned decision as in the said case after the main noticee was issued the discharge certificate under the SVLDR Scheme, 2019 towards the duty liability the co-noticee had not filed the declaration but was held to be entitled to the waiver of penalty as non-filing of the declaration was held to be merely a procedural flaw for which the appellant cannot be burdened with the liability of penalty more so since there was no loss to the revenue - Similarly, the appellant herein have also not filed the declaration after the main noticees have been issued Discharge Certificate towards the duty liability but the fact remains that if the appellant had applied under the SVLDR Scheme, they would have paid “nil” rate of duty in view of the relief available to them under section 124 (i) (b)of the Finance Act, 1994.
Conclusion - The procedural oversights, such as the failure to file a declaration under the Sabka Vishwas Scheme, should not result in penalties if the main noticees have settled their liabilities.
The impugned order deserves to be set aside and consequently, no penalty can be imposed on the appellant - Appeal allowed.
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2025 (1) TMI 1032
Clandestine removal of goods - appellant has shown excess usage of electricity which is used by the appellant for excess production of M.S.Ingots which has been cleared clandestinely by the appellant - extended period of limitation - HELD THAT:- As per technical opinion report of IIT, Kanpur, the consumption of electricity ranges between 555 units to 1026 units which means it depends on the various factors i.e. quality of furnace, quality of raw material, quality of workers and efficiency thereof and the said report has been discarded by this Tribunal in the case of R.A. Castings P Ltd. [2008 (6) TMI 197 - CESTAT NEW DELHI] which has been affirmed by the Hon’ble Apex Court.
Therefore, merely on the basis of excess electricity consumption by the appellant demand alleging clandestine manufacture and removal of goods is not sustainable.
As it is declared law that on the basis of excess comsumption of electricity demand cannot be raised on the basis of assumption and presumption. The charge of clandestine manufacture and clearance thereof is to be proved by cogent evidence which Revenue failed to do so.
Conclusion - The allegations of clandestine manufacture based solely on electricity consumption data are unsustainable without corroborative evidence.
Appeal allowed.
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2025 (1) TMI 1031
Condonation of delay of over 1 year and 7 months in filing appeal - sufficient cause for delay or not - clandestine manufacture and clearance of unregistered units - non-production of the finished goods from the other premises - HELD THAT:- The Hon’ble Apex Court in the landmark judgement governing condonation of delay in the case of COLLECTOR, LAND ACQUISITION VERSUS MST. KATIJI AND OTHERS [1987 (2) TMI 61 - SUPREME COURT] has laid down a six-point guideline for consideration of the application for condonation of delay. Thus, while it is observed that ordinarily a litigant would not stand to gain from a delayed consideration of the matter, and while it is too well known that when substantial justice and technical considerations are pitted against each other, cause of substantial justice deserves to be preferred; however it is equally important that‘each day’s delay in filing the appeal is required to be explained.
It is found that not even a weak attempt at such an explanation accounting for the enormous delay of nearly two years (after discounting suo motu limitation free period), accruing in the present matter.
Though, time and again, Courts have emphasized that “sufficient cause” ought to be viewed with flexibility, but the same in the first place needs to be properly accounted for and satisfied with. Just because the Court has power to condone the delay, it cannot be so done mechanically and appeal accepted, but for appropriate and justifiable reasons.
The apex Court in the case of AJAY DABRA [2023 (1) TMI 1279 - SUPREME COURT], refused to condone the delay recently where it was alleged that the appellant was short of funds to pay court fee. It held that the appeal could have been filed and defects attended to (could be removed) thereafter. This is to point out that financial conditions are not a potent reason to admit a COD application.
The Hon’ble Andhra Pradesh High Court in the case of Shanti Alloys Pvt. Ltd. v. Commissioner of C.Ex., Hyderabad [1998 (12) TMI 92 - HIGH COURT OF JUDICATURE, ANDHRA PRADESH AT HYD.] had held that a delay in filing appeal beyond ninety days was not condonable in view of the specific provisions of Section 35(1) of the Act.
Conclusion - There are no merit in contentions and submissions put forth in the Affidavit and the application for condonation of delay for delayed filing of the present appeal, as the obligation to show sufficient cause, is on the appellant, applying for condonation of delay.
The appeal as well as the COD application are hereby dismissed.
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2025 (1) TMI 989
Valuation of Central Excise duty - price, the sole consideration of sale - invocation of extended period of limitation under the proviso to Section 11A(1) of CEA 1944 - levy of penalty u/s 11AC.
Whether the price was the sole consideration of sale? - HELD THAT:- Taking into consideration the aforementioned parts of the MOU, it is crystal clear that the arrangement reflected from the MOU is essentially for ensuring that every OMC gets smooth and uninterrupted supply all over India, irrespective of whether an OMC has a refinery or otherwise in a particular part of India. Thus, from a plain reading of the MOU, we find that the real consideration for the MOU was to ensure an uninterrupted supply to all the OMCs at various places in India. The MOU incorporates mutual arrangements made by MNCs for an uninterrupted supply of petroleum products so that MNCs can further sell the products to their dealers. By no stretch of the imagination, it can be said that the price fixed under the MOU was the sole consideration for the sale by one OMC to the other. Hence, the conclusion in the impugned judgment concurred with, that the price was not the sole consideration for sale.
Turning to the decision of the Tribunal in Hindustan Petroleum Corporation Ltd. [2005 (2) TMI 357 - CESTAT, BANGALORE], an appeal against which has been summarily dismissed by this Court. Apart from mentioning that the MOU was executed according to the direction of the Government of India, the Tribunal has not looked into the contents of the MOU. There is a vague reference to HPCL's agreement with other oil companies. There is no specific finding recorded therein, after considering the terms and conditions of the MOU, that the price was the sole consideration for the sale. Therefore, the decision of the Tribunal ignores a crucial ingredient of Section 4(1)(a) of whether the price was the sole consideration for the sale.
Whether the revenue was entitled to invoke an extended period of limitation under the proviso to Section 11A(1) of the 1944 Act? - HELD THAT:- Under the proviso to sub-section (1) of Section 11-A, an extended period of limitation can be invoked when there is a nonlevy or non-payment or short levy or short payment of the excise duty by a reason of fraud or collusion or any wilful mis-statement or suppression of facts or contravention of any of the provisions of 1944 Act or the rules made thereunder with the intent to evade payment of duty. The show cause notice referred to the statements recorded of BPCL officers and other OMCs. No detailed reasons have been recorded in support of invoking the extended period of limitation by the Commissioner in his order.
A careful perusal of the show cause notice shows that it is not alleged that any such misrepresentation was made by BPCL that the pricing as provided in the MOU was adopted by the BPCL as per the directions of the Central Government. The reply to the show cause notice submitted by the BPCL contains no such representation. In the show cause notice, statements recorded of officers of BPCL and other OMCs have been referred to and relied upon. However, it is not alleged that any of the officers stated that the price of the goods sold under the MOU was fixed as per the directives of the Central Government - both the grounds in support of invoking an extended period of limitation cannot be sustained, and only on that ground, the demand cannot be sustained.
Whether the revenue was entitled to levy a penalty under Section 11AC of the 1944 Act? - HELD THAT:- In this case, there is no allegation made by the Revenue of fraud, collusion or any wilful mis-statement on the part of the appellant. The stand taken is that the MOU was suppressed, and therefore, Section 11AC will apply. In view of the findings recorded above on the issue of the invocation of the extended period of limitation, the penalty could not have been imposed.
Conclusion - i) The price was not the sole consideration for sale. ii) No detailed reasons have been recorded in support of invoking the extended period of limitation by the Commissioner in his order. iii) The stand taken is that the MOU was suppressed, and therefore, Section 11AC will apply. The penalty could not have been imposed.
Appeal allowed.
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2025 (1) TMI 988
Condonation of delay of 875 days in filing the Civil Appeals which has not been satisfactorily explained by the appellant - Area based exemption - Ready Mix Concrete - exemption Notification No.12/2012-CE dated 17.03.2012 - it was held by CESTAT that 'The adjudicating authority had rightly extended the benefit of exemption notification in respect of Ready Mix Concrete (RMC) used by the assessee in their manufacturing premises for construction work hence, the demand for the period April, 2016 to June, 2017 was rightly dropped by the adjudicating authority on the ground of its merit.'
HELD THAT:- The Civil Appeals are, accordingly, dismissed on the ground of delay.
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2025 (1) TMI 987
Refund against payment of CVD & SAD in cash under transitional provisions available in Section 142(3) read with Section 142(6)(a) of the CGST Act - denial on the ground that Appellant had paid duty amount alone and not interest or the penalty that was imposed by the DGFT for which regularisation of import remained incomplete - HELD THAT:- The issue that remained primarily confined to absence of any such provision in Rule, 9(1)(b) of the CENVAT Credit Rules, 2004 that would have made fulfilment of the condition contained in DGFT letter as a condition precedent for such refund and non-payment of interest that would disentitle the benefit of refund of CVD & SAD to the manufacture upon sale of goods, manufactured from imported inputs, which Appellant claimed to have not paid due to exercise of discretion of Customs Authority in allowing such non-payment of interest by the Appellant in its favour but subsequently have to pay the same interest upon refusal of its refund application and such payment of interest was duly intimated to the Respondent-Department vide its letter dated 31.03.2022. With these developments that occurred during pendency of this appeal, it is to be seen as to if Appellant is entitled to get refund of CVD & SAD in cash and if CESTAT is empowered to pass an order to that effect.
On the point of divergent decision on the issue as has been held in M/S. SERVO PACKAGING LIMITED VERSUS COMMISSIONER OF G.S.T. AND CENTRAL EXCISE, PUDUCHERRY [2020 (2) TMI 353 - CESTAT CHENNAI] and M/S. AUROBINDO PHARMA LTD. VERSUS COMMISSIONER OF CUSTOMS, CHENNAI II [2022 (5) TMI 394 - CESTAT CHENNAI], this Tribunal at Hyderabad had observed that those were passed before Larger Bench’s view had come in the case of M/S. BOSCH ELECTRICAL DRIVE INDIA PRIVATE LIMITED VERSUS COMMISSIONER OF CENTRAL TAX, CHENNAI [2023 (12) TMI 1145 - CESTAT CHENNAI-LB] and not applicable to the present case since same Chennai Bench itself had subsequently passed another order holding that Appellant would be eligible for cash refund. Therefore, the issue of cash refund of CVD & SAD paid in GST Regime has attained finality in favour of such cash refund.
Another point that is required to be brought on record is that post disposal of appeal by the Commissioner (Appeals), interest was paid by the Appellant and in the normal course matter would have gone to the Commissioner (Appeals) for redetermination had he made any observation on the point that payment of interest against CVD & SAD dues was mandatory to allow refund of those two taxes upon sale of manufactured goods and had there been any such condition available under Rule, 9(1)(b) of the CENVAT Credit Rules, 2004 but having regard to fact that Respondent-Department was competent to realise any arrear dues from the refund sanction under Section 142 in view of clear provision contain under Section 142(8) of the CGST Act, apart from the fact that such a provision was already existing under Section 11(1) of the Central Excise Act, there is no point in redetermining the issue that was not dealt by the Commissioner (Appeals).
Conclusion - Appellant is entitled to get refund of CVD & SAD with applicable interest as per law in cash.
Appeal allowed.
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2025 (1) TMI 986
Process amounting to manufacture - whether the activities undertaken by the appellant in respect of certain quantity of ROM manganese ore would result into manufacture of concentrate or otherwise? - HELD THAT:- There is a need to establish that the ROM ore has undergone any change or not due to processes undertaken. This would be mainly depending on the manner in which the samples were drawn and the manner in which they were tested as also the nature of activities undertaken, which is not distputed. Therefore, both the issues of drawal of samples as well as test needs to be amply clear before the charges can be further corroborated. From the perusal of the Order, both these aspects have not been dealt with adequately by the Adjudicating Authority. More so, when cross examination of the Chemical Examiner has been denied, it would definitely tantamount to denial of natural justice, in the facts of the case. Said Test Reports are the major evidence based on which the allegation of increasing concentration has been made by the Department and categorically holding that manufacturing process has been undertaken on ROM ore. There is also some fact in appellant’s contention that quantification of denial is correct as to the ROM and processes have been clubbed together - the Order is not a speaking order and has not been dealt with certain aspects which the Advocate has pointed out including the entitlement of benefit of N/N. 63/95-CE, in the event it is held to be a manufacturing process.
Conclusion - The Order is not a speaking order and has not been dealt with certain aspects which the Advocate has pointed out including the entitlement of benefit of N/N. 63/95-CE, in the event it is held to be a manufacturing process.
The matter should be remanded back to the Original Adjudicating Authority, who shall re-hear the matter after allowing the cross examination of the Chemical Examiner, whose test reports have been relied in the show cause notice and Order-in-Original - Appeal allowed by way of remand.
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2025 (1) TMI 933
Challenge to SCN issued u/s 11-A of the Central Excise Act - petitioners contended that petitioners are not the manufacturers and hence no notice could have been issued to them under Section 11-A of the Central Excise Act - HELD THAT:- The judgment of the Apex Court in Supermax Personal Care Pvt. Ltd. Vs. Union of India, Commissioner CGST & CEX Audit-Thane, Commissioner CGST & CE Thane Commissionerate [2021 (4) TMI 368 - BOMBAY HIGH COURT] has no applicability to the facts of the present case, for the very reason that suspicious material was found at the place of the petitioners and it was found that petitioners were clandestinely involved in manufacturing of Cigarettes and even goods were being supplied which were actually relating to the manufacturing of Cigarettes.
The law which emerges from the above judgment is that when an alternate efficacious remedy is available and there are disputed questions of facts, the High Court should decide to decline jurisdiction in a writ petition.
Present is a case where on search, it was revealed that petitioners were indulged in clandestine supply of goods to manufacturers of Cigarettes in Bihar. Therefore, in a manner petitioners were also involved in manufacturing of Cigarettes. Though this fact is disputed by the petitioners, but since petitioners have only been given a show cause notice, petitioners are free to raise all objections before the concerned Competent Authority in reply to the show cause notice.
It is not inclined to entertain the present Civil Writ Petition and the same is accordingly, dismissed.
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2025 (1) TMI 932
100% EOU - entitlement to take suo-moto re-credit of the Cenvat credit that was earlier reversed, without following the refund procedure under Section 11B of the Central Excise Act, 1944 - HELD THAT:- Indisputably it is also evidence from the records that the cenvat credit taken and utilized by the appellant, stands fully recouped, consequent to the reversal entries and payments made, including interest thereon. By such reversal and payments, it is evident that the effect of such reversal is entirely borne by the appellant and the original credit taken stands expunged. Thereafter, as intimated by the appellant when it takes credit of the proportionate cenvat credit, out of the amount of cenvat credit on licit input services which it even otherwise was originally entitled to take credit of, there is no illegality attached to the said taking of credit. Moreover, such taking of credit stands reported in the ER-2 return filed by the appellant. This Tribunal is of the view that in such circumstances there is no necessity to put the appellant through the rigors of seeking refund by following the procedures of section 11B of the Act. The reliance placed by the adjudicating authority on the decision of Tribunal larger bench in BDH Industries [2008 (7) TMI 78 - CESTAT MUMBAI-LB] is misplaced. This tribunal in Sopariwala Exports Pvt Ltd v CCE, Vadodara [2013 (5) TMI 430 - CESTAT AHMEDABAD] has already held that when the High Court decision holds the field the larger bench decision does not have binding effect.
It is also pertinent that the jurisdictional officer has not raised any objection to the appellant’s intimation of its intent to avail the credit being reversed at a later date, when communicated vide appellant’s letter dated 21.07.2009. That apart, the appellant has also stated that they had intimated the availment of the credit in the ER 2 returns filed and further that to an audit objection against the availment during March 2011, they had, vide letter dated 27.04.2011, replied that the objection is unsustainable - Even otherwise, when the appellant has already communicated its intent to take the credit reversed at a later date upon completion of the work and when it reflects the credit taken in the ER-2 returns, the appellant cannot be held to have made any wilful mis-statement or suppression of facts with intent to evade payment of duty warranting invoking of the extended period of limitation. Therefore, given that the SCN in this case is dated 11.09.2013 and has been issued invoking the extended period of limitation for making demand of the credit taken in the month of December 2009, it is evidently beyond the normal period stipulated in Section 11A and thus the demand is also barred by limitation.
Conclusion - Suo-moto re-credit is permissible when the original credit is eligible, and the reversal is merely an accounting entry. The extended period of limitation cannot be invoked without evidence of willful misstatement or suppression. The demand made of Rs.40,64,459/- under Rule 14 of Cenvat Credit Rules, 2004 read with Section 11A of the Central Excise Act, 1944 and the demand of appropriate interest thereon as well as the penalties imposed under the impugned order in original, are untenable.
Appeal allowed.
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2025 (1) TMI 931
Liability to pay interest - reversal of Cenvat credit - whether the appellant is liable to pay interest and can also be imposed with penalty, if the Cenvat credit is reversed even before utilising the Cenvat credit? - inclusion of the terminal charges in the assessable value - price revision of petroleum products with retrospective effect.
Interest on reversal of Cenvat credit and penalty - HELD THAT:- The Hon’ble High Court of Karnataka in the matter of COMMISSIONER OF CENTRAL EXCISE & SERVICE TAX LARGE TAXPAYER UNIT, BANGALORE VERSUS M/S BILL FORGE PVT LTD, BANGALORE [2011 (4) TMI 969 - KARNATAKA HIGH COURT], held that if the Cenvat credit is reversed before utilization of credit, it amounts to not taking credit, no liability to pay interest. Hence, we find that against show-cause notice dated 04.12.2006, the appellant is not liable to pay interest on the reversal of unutilized Cenvat credit and thus no penalty under Rule 25 of Central Excise Rules, 2002 can be imposed for that reason.
Demand of interest in the other two show cause notices and imposition of penalty under Rule 25 of Central Excise Rules, 2002 in show cause notice dated 20.09.2006 - HELD THAT:- The inclusion of the terminal charges in the accessible value and the revision of petroleum products with retrospective effect has resulted in payment of differential duty, which the appellant has discharged and there is no dispute on these two issues. The appellant has paid the differential duties and is only contesting the payment of interest and imposition of penalty - since there is no limitation prescribed under the statute for payment of interest and there is no interest on the interest, the appellant is liable to pay interest for the period of delay in payment of differential duty, it is found that once the differential duty is paid, consequentially the interest for the delayed payment need to be paid, hence the interest on delayed payment of duties in these two show cause notices was rightly confirmed by the Adjudicating and the Appellate authorities and is tenable.
Conclusion - Reversal of unutilized Cenvat credit negates interest liability. Interest is payable on delayed differential duty payments. The penalty under Rules 25 of Central Excise Rules, 2002 is set aside.
Appeal allowed in part.
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2025 (1) TMI 841
Maintainability of appeal - appropriate forum - appeal filed under Section 35G of the Central Excise Act, 1944, is maintainable before the High Court or not - taxability of services provided to a Municipal Corporation - HELD THAT:- Sub-section (2) to Section 35L of the Act was inserted with effect from 6.8.2014 by Section 107 of the Finance Act (2) Act, 2014 and that the amendment was clarificatory was accepted by the department. In this regard, the Ministry of Finance, Department of Revenue, Tax Research Unit has issued circular dated 10.7.2014 which refers to the bill introduced in the Lok Sabha by the Hon’ble Finance Minister. It has been clarified by the said circular that section 35L is being amended so as to clarify that determination of disputes relating to taxability or excisable of goods is covered under the term “Determination of any question having a relation to the rate of duty” and, hence, appeal against Tribunal order in which matters would lie before the Hon’ble Supreme Court.
This decision was followed by the Hon’ble Division Bench of the High Court of Punjab and Haryana in the case of COMMISSIONER SERVICE TAX VERSUS DLF GOLF RESORTS LTD. [2017 (5) TMI 402 - PUNJAB AND HARYANA HIGH COURT]. In the said decision it has been held that the appeal does not lie before the High Court under Section 35G of the Act but appeal would lie before the Hon’ble Supreme Court under Section 35L of the Act.
Conclusion - Disputes relating to the taxability of services fall under the jurisdiction of the Supreme Court, not the High Court, as clarified by the amendment to Section 35L of the Central Excise Act, 1944. The appeal is liable to be dismissed on the ground that it is not maintainable under Section 35G of the Act.
Appeal dismissed.
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