|
Advanced Search Options
Central Excise - Case Laws
Showing 41 to 60 of 81316 Records
-
2024 (11) TMI 987
Time Limitation - suppression of facts or not - concessional rate of duty - Interpretation of Notification No. 12/2012-CE and subsequent amendments regarding concessional rates of duty for goods falling under Chapter 85 - short payment of Central Excise duty due to misinterpretation of notification - HELD THAT:- The appellant had bonafide belief that goods attract 10% as per the rate prescribed under the Notification No.12/2012-CE dated 17.03.2012 even the notification was time bound wherein, the closure date was prescribed of31.12.2014. By amendment in the said notification, the appellant’s goods i.e. falling under85441190was excluded by Notification dated 11.07.2014. Since, the notification otherwise prescribed the time limit upto31.12.2014,the appellant had bonafide belief that 10% rate is effective till 31.12.2014. It is only because of the appellant was not aware of the notification, they continued to pay the duty at the rate of 10%. Appellant’s bonafide further get reinforced on the ground that the appellant have been declaring the goods with Chapter heading and the rate of duty, at the rate of 10% in their all ER-1 monthly return for the period July, 14 to December,14. The changes were brought by statutory amendment which is otherwise known to the department also. The department was also aware that the appellant prior to 11.07.2014 had been paying the duty at the rate of 10%.
The officers have verified those documents while processing the rebate claim and/ or the clearance is under bond. Therefore, all the facts were available on record before the department and nothing was prevented from the department to initiate the action for demanding the differential duty within the normal period. However, the show cause notice for the period July,14 to December, 2014 was issued only on 18.10.2017 by way of show cause notice. Therefore, the entire demand is within the extended period.
Since there is no suppression of fact on the part of the appellant, the demand for extended period shall not sustain. Accordingly, the demand of duty confirmed by the lower authorities is set aside on the ground of the time bar itself.
The appeal is allowed.
-
2024 (11) TMI 986
Exemption from Excise Duty under N/N. 6/2006-CE dated 1.3.2006 - goods supplied against international competitive bidding - appellant contended that they were entitled to the benefit of Notification No. 6/2006-CE dated 1.3.2006, in view of the fact that there was no dispute with respect to the goods which were supplied against international competitive bidding - HELD THAT:- Considered the fact that the Tribunal in the appellant’s own case M/S WPIL LIMITED VERSUS COMMISSIONER OF CENTRAL EXCISE, KOLKATA-III [2023 (7) TMI 298 - CESTAT KOLKATA] has observed that 'the Appellant is eligible for the benefit of Notification No. 6/2006-CE dated 1.3.2006, as they have fulfilled all the conditions required to avail the said exemption. Accordingly, we hold that the demands made in the impugned order are not sustainable and the same is liable to be set aside.'
The appellant is entitled for the benefit of Notification No.6/2006-CE dated 01.03.2006, as they have fulfilled all the conditions required to avail Cenvat credit, therefore, no demand is sustainable against the appellant.
Appeal allowed.
-
2024 (11) TMI 985
Clandestine removal - Gutkha pouches and related materials - retraction of statements - Confiscation of goods - 90 bundles containing 1872720 Gutkha pouches and related materials, three packaging machines - demand of duty with interest and penalty - HELD THAT:- Undisputed facts of the case are that Gutkha pouches brand-named “Raj Kolhapuri” along with other related materials, three packaging machines and one lorry were seized by the Banavasi Police on 03.11.2009 which was later, with the intervention of the Central Excise Department, on direction by the Hon’ble Principal JMFC was handed over to the Central Excise Department for further investigation. The said materials were again seized on 09.12.2009 and statements of persons were recorded again to ascertain the quantum of offence. From analysis of the statements, it revealed that the Gutkha and three packing machines were seized from the premises viz. House No.6, Plot No.21, Golikatta Village, Gudnapura – 581 318, Banavasi, Sirsi Taluk Uttara Kannada which was given on rent by the owner of the said premises Shri Dhananjaya Krishna Hegde for a period of one month to the appellant by an understanding recorded on 28.10.2009 was manufactured in the said premises and cleared without payment of duty.
The appellant from the very beginning expressed his ignorance about the said labourers and undertaking the manufacture of Gutkha in the said premises. However, no request for cross-examination of the witnesses was requested by the appellant before the adjudicating authority. Neither the appellant nor Mr. Dhananjaya Krishna Hegde, the owner of the said premises has claimed before the authorities that the Gutkha packed in the plastic pouches having mark of ‘Raj Kolhapuri Gutkha’ belongs to them or the seized machineries have been claimed to belong to them and requested for its release to them. On the other hand, both of them denied being involved in the manufacturing of Gutkha in the said premises.
Since duty paid character of the Gutkha has not been established and on the basis of the statements given by the labourers and lorry driver and retrieving the three machineries from the manufacturing premises, it is clear that the said Gutkha bearing name ‘Raj Kolhapuri’ manufactured in the said premises and cleared without following procedure and discharging duty payable on the same. Consequently, the Gutkha as well as the three packaging machines and other related materials seized by Police on 03.11.2009 and later by Central Excise Department on 09.12.2009 are liable for confiscation and hence the order of the Commissioner directing the confiscation of the same does not require any interference.
More or less, similar views expressed by the Tribunal in a series of cases, including the cases COMMR. OF C. EX., HYDERABAD VERSUS DHARIWAL INDUSTRIES LTD. [2010 (4) TMI 890 - CESTAT, BANGALORE]; GOYAL TOBACCO CO. PVT. LTD. SHRI RAJESH GOYAL, DIRECTOR VERSUS CCE & ST, JAIPUR-I [2017 (3) TMI 57 - CESTAT NEW DELHI], COMMISSIONER OF CENTRAL EXCISE, DELHI-I, M/S KUBER TOBACCO INDIA LTD, SHRI DHANPAT SINGHEE, DIRECTOR, SHRI CHATAR SINGH BAID, SHRI VIKAS MALU VERSUS M/S KUBER TOBACCO INDIA LTD, COMMISSIONER OF CENTRAL EXCISE, DELHI-I [2016 (4) TMI 622 - CESTAT NEW DELHI] Hence, the demand in absence of evidence of the nature narrated above being not adduced by the Department, hence cannot be sustained, only on the basis of the date of installation of electricity meter at the said premises. In these circumstances, the demand confirmed by the learned Commissioner is liable to be set aside. Accordingly, the same is set aside and consequently penalty imposed on the appellant under Section 11AC of the Central Excise Act, 1944 also set aside.
The impugned order is modified to the extent of upholding confiscation of the seized goods, three machines and related materials; however, confirmation of demand, interest and imposition of penalty on the appellant is set aside. Appeal is disposed of.
-
2024 (11) TMI 984
Rejection of refund claim over and above the value addition - appropriation of pre-deposit made - HELD THAT:- The appellant has filed the refund claim of the pre-deposit along with interest on the basis of CESTAT Final Orders dated 23.03.2018 and 28.08.2018 but the Assistant Commissioner vide two Order-in-Original 512 and 514 sanctioned the refund along with interest but appropriated the said refund of Rs. 15,00,000/- and Rs. 32,77,590/- against the total demand of Rs.2,17,35,588/- on account of value addition confirmed for the period February 2012 to April 2012.
It is found that when the appeal against the Order-in-Original was pending before the Commissioner (Appeals), the appellant Voluntarily deposited the demand against all three OIOs relating to February 2012 to April 2012 and intimated the jurisdictional Deputy commissioner Jammu vide letters dated 14.08.21 duly acknowledged on 26.08.2021 and the copies of challans have also been produced showing the payment of the entire demand of Rs. 2,17,35,588/-. Further, it is found that the appellant has voluntarily deposited the entire demand amount and informed the Department but the Department did not acknowledge the same in spite of challans showing payments being attached.
Since, the appellant has voluntarily made the complete payment thereafter appropriation of the pre-deposit amount of refund sanctioned against the said demand is not legally sustainable - further it is found that the appellant specifically intimated to the department regarding the payment of the entire amount of Rs. 2,17,35,588/- and also produced the challans but in spite of that the Ld. Commissioner has upheld the Order-in-Original, appropriating the refund claim against the demand which has already been paid, when the department has collected the entire demand confirmed by the various orders thereafter, the Department is not justified to retain the sanctioned refund and appropriated the same.
The both impugned order dated 08.12.2022 are not sustainable in law and is set aside - appeal allowed.
-
2024 (11) TMI 983
Refund claim under Rule 5 of Cenvat credit rules - input services - Rule 5 of Cenvat credit rules 2004 - it is alleged that input service involved in the refund claim has no nexus with the manufacture of export goods - HELD THAT:- It is found that it is undisputed that at any stage the revenue has not issued any show cause notice or adjudicated thereupon the issue of admissibility of input service in terms of rule 14 of Cenvat Credit Rules, 2004 therefore the allowance of the credit on the input service in question attained finality and when this be so then by filing the appeal against the sanctioned order of the refund dispute about admissibility of the service for purpose of allowing the Cenvat credit cannot be raised. The learned Commissioner (Appeals) on this very ground rejected the appeal of the revenue.
From the findings of the Commissioner (Appeals) it can be seen that the Commissioner (Appeals) rejected the appeal of the revenue on the threshold point that the department has not taken any action under rule 14 for disputing the admissibility of input service in question. The findings of the learned commissioner (Appeals) based on various judgments. Therefore, this issue is no longer res-integra. Without prejudice, it is also found that all the service which were questioned by revenue are admissible input service as held in various judgment as cited by the appellant in their synopsis.
It is further found that though the revenue in the appeal before the Commissioner (Appeals) as well as before this tribunal reiterated that the input services involved in present case have no nexus with the manufacture of the export goods, however, no reasoning is given that why these services are not essential in or relation to the manufacture of exports goods. For this reason also the revenue’s appeal is hollow and without any basis. As per the above discussion, there are no infirmity in both the orders passed by authorities below.
The impugned order is upheld - Revenue’s appeal is dismissed.
-
2024 (11) TMI 982
Classification of goods - Biovita - to be classified under heading 3101 0099 or under Central Excise heading as 3105 of Central Excise Tariff? - HELD THAT:- A perusal of show cause notice shows that it relies on the CBEC Circular 1022/10/2016-CX dated 06.04.2016. The said circular prescribed that micronutrient could not be classified under Chapter 31 as ‘fertilizer’. It also relies on the fact that the appellants had in the month of July 2015 themselves classified the goods under Central Excise Tariff Heading 3808 and in the months of June, August, September-2015 classified the product under Central Excise Tariff Heading 3105 as per directions of M/S. P.I. INDUSTRIES LIMITED (FORMERLY M/S. ISAGRO (ASIA) AGROCHEMICALS PVT. LTD.) ; M/S. AGRO PACK; SHRI PARTH H. PATEL VERSUS COMMISSIONER OF CENTRAL EXCISE & CUSTOMS, SURAT-II, SURAT [2024 (9) TMI 1655 - CESTAT AHMEDABAD (LB)] the principal manufacturer. It is noticed that subsequent to the impugned order, the issue regarding classification of goods between Chapter 31 and Chapter 38 was referred to the Larger Bench in the case of PI Industries (the Principal Manufacturer itself).
It is seen that while the products in the instant case are not identical but similar in nature, therefore, the principles laid down by Larger Bench of Tribunal in the case of PI Industries would equally apply to the product in the instant case.
In view of above, the impugned order is set aside and matter remanded to the original adjudicating authority for fresh decision in the light of observations made by Larger Bench in the case of PI Industries.
Appeal is allowed by way of remand.
-
2024 (11) TMI 920
Clandestine removal - unbranded biris - appellant submitted that they were carrying job work for Samar Biri Factory and the unbranded biri is not full manufactured condition - Non-compliance with N/N. 214/86-CE. - HELD THAT:- The factual documentary evidence prove that the Samsuddin Ahmed was undertaking the job work of semi-finished Biri making which was not in a fully manufactured and marketable condition. Hence, the same cannot be treated as finished goods for demanding the Excise Duty. Further, as per the verification report given by the Assistant Commissioner, Siliguri, Samar Biri factory has for the receipt of semifinished biris and has carried out certain more work and have paid the applicable excise duty and the same have been cleared from their end. Therefore, there are no justification in the seizure, confiscation and imposition of Redemption Fine on 297 bangs of unbranded biris.
Thus, non following of the procedure under Notification No. 214/86-CE on its own cannot be the ground for demanding the duty from the appellant particularly when it is getting clarified that the principal has paid the Excise Duty at his end. However the appellant and principal should have been followed the procedure and given proper intimation to the respective jurisdiction which has not been done in this case. For such procedural lapse, the appellant is required to be imposed penalty. Accordingly, taking over all view of the factual details of the case, the penalty imposed on Samsuddin Ahmed modified to Rs. 10,000/- and Rs. 25,000/- on Samar Biri Factory.
Appeal disposed off.
-
2024 (11) TMI 919
CENVAT Credit - input services - service tax paid on GTA services which were utilized for movement of manufactured goods from the factory to the customer’s premises for delivery of the goods at customer’s place - HELD THAT:- It is undisputed fact that the appellant is under contract for delivery of the goods on FOR destination at the customer’s premises and the goods remained in the ownership of the appellant till the goods reached customer’s premises and that the sale takes place at the customer’s premises and the property or ownership of the goods is transferred to the customer at the customer’s premises. It is settled law that cenvat credit of service tax paid on transportation of goods till the place of removal is admissible to a manufacturer. Now it is to be decided in the present case as to whether customer’s premises is place of removal.
It is noted that in the case of Roofit Industries Ltd. [2015 (4) TMI 857 - SUPREME COURT], Hon’ble Supreme Court has held that the charges which are to be added for arriving at the value of the excisable goods will have to be put up to the stage of the transfer of the ownership of the goods from the manufacturer to the buyer. In para 13 of the said order, it was observed that in that case the sale of goods did not take place at the factory gate of the assessee, but at the place of the buyer on the delivery of the goods.
In the present case the fact on record is that the ownership of the goods remained with the appellant till such time the goods were delivered at the buyer’s premises. Therefore, in the present case the place of removal is buyer’s premises. It is settled law that input service credit is admissible upto the place of removal. Therefore, in the present case the appellant was eligible for the said cenvat credit.
The impugned order is set aside - appeal allowed.
-
2024 (11) TMI 878
Process amounting to manufacture or not - re-packing of various excisable goods (herbal and cosmetic products), affixing the brand names owned by them in their premises - Illegality of duty liability under Section 4 of the Excise Act - it was held by CESTAT that 'demand confirmed even under Section 4 of Central excise Act, 1944 set aside' - HELD THAT:- After having heard the learned counsel appearing for the appellant and after perusing the findings recorded by the Customs, Excise and Service Tax Appellate Tribunal, New Delhi, no error is found therein.
The appeal is accordingly dismissed.
-
2024 (11) TMI 877
Disallowance of CENVAT Credit - service tax paid on the goods transport agency (GTA) services received by the appellant to transport the cement from its factory to the buyer’s premises sold on FOR (free on road) destination basis - place of removal - recovery alongwith interest and penalties - HELD THAT:- Since there were conflicting views, the issue was referred to the Larger Bench in Ramco Cement versus CCE [2023 (12) TMI 1332 - CESTAT CHENNAI-LB]. The Larger Bench decided that where the goods are sold on FOR destination basis and the ownership of the goods gets transferred at the customer’s premises, the place of removal shifts to the buyer’s premises.
In this case, there is no dispute that the goods were sold on FOR destination basis and so the place of removal gets shifted at the buyer’s premises. Therefore, following the decision of the Larger Bench, it is held that the ‘place of removal’ shifts to the buyer’s premises and the appellant is entitled to CENVAT credit of the service tax paid on GTA services availed to transport the goods to the buyer’s premises.
The impugned order is set aside - appeal allowed.
-
2024 (11) TMI 876
Non-appearance of the Appellant or his authorised representative on the dates of public hearing - absence of authorized representative - HELD THAT:- Rule 20 of CESTAT (Procedure) Rules, 1982 provides that if the appellant appears afterwards and satisfies the Tribunal that there was sufficient cause for his non-appearance when the appeal was called on for hearing can set aside the dismissal and restore the appeal.
The adjournments can’t be given for the mere asking without any serious reason, backed with proof, for the non-appearance of the Appellant or his authorised representative on the dates of public hearing. Thus, no purpose would be served in continuing with this appeal and hence reject the same for default as per Rule 20 of CESTAT (Procedure) Rules, 1982.
The appeal is disposed of accordingly.
-
2024 (11) TMI 875
Reversal of CENVAT Credit - packing material which is used for dutiable as well as non-dutiable products - invoice does not bear invoice number - HELD THAT:- In this case main denial of the Cenvat credit of Rs.10,03,635/- on the basis of ISD invoices issued to the appellant for promotional and marketing expenses alleging that the said promotional and marketing expenses are not wholly for the product manufactured by the appellant. The said issue has been examined by the Larger Bench of this Tribunal and the penalty in the case of M/s. Krishna Food Products [2021 (5) TMI 906 - CESTAT NEW DELHI] wherein this Tribunal observed 'A narrow and a literal interpretation of the phase its manufacturing units should, therefore, be avoided, more particularly when the Registration Exemption Notification provides for authorisation for manufacture of goods on behalf of the principal manufacturer. There appears to be no good reason as to why CENVAT credits should not be allowed to be distributed to a job worker in the facts and circumstances of the present case.'
The appellant is entitled to take Cenvat credit of Rs.10,03,635/-. Therefore, the said Cenvat credit is allowed.
Availment of Cenvat credit - HELD THAT:- The appellant has produced the invoice bearing invoice number and the learned Authorized Representative also admitted that invoice number mentioned in the invoice, therefore, the said Cenvat credit is correctly taken by the appellant. Accordingly, Cenvat credit of Rs.32,149/- is allowed to the appellant.
Cenvat credit on packing material - HELD THAT:- The reversal of proportionate Cenvat credit is sufficient for the appellant to avail Cenvat credit of Rs.39,159/-. If there is any discrepancy in the availment of Cenvat credit, the adjudicating authority shall verify from the records and if some calculation error is there, the appellant shall reverse the said proportionate Cenvat credit. In view of this, it is held that the appellant is entitled to take Cenvat of Rs.39,159/- also if there is no calculation error found by the adjudicating authority.
No penalty is imposable on the appellant.
The appeal is disposed of.
-
2024 (11) TMI 828
Area based exemption - condition of commencement of commercial production not later than 31-3-2010 - Benefit of Notification No. 50/2003-C.E., dated 10-6-2003 - It was held by CESTAT that 'The commercial production by the clinker plant by this new cement unit thus does not mean commercial production by the cement unit which is meant/required to commercially produce cement. Further commercial production of clinker by the clinker plant of this cement unit is not germane to the issue also because clinker figures in the negative list (Annexure-I referred to earlier) and therefore provisions of Notification No. 50/2003 do not even apply to the commercial production by clinker plant of new cement unit.' - HELD THAT:- It is not required to interfere in the matter.
The Civil Appeals are dismissed.
-
2024 (11) TMI 827
Condonation of delay of 157 days in filing this Special Leave Petition - Disallowance of CENVAT Credit - capital goods on which the CENVAT credit was availed were used to manufacture only exempted goods (electricity) - Rule 6(4) of the CENVAT Credit Rules, 2004 - Suppression of facts or not - time limitation - Jurisdiction of the Revenue authority when the show cause notice was issued - it was held by High Court that 'The impugned order set aside' - HELD THAT:- Though there is a delay of 157 days in filing this Special Leave Petition, learned senior counsel for the petitioner is heard.
It is not required to interfere in the matter - The Special Leave Petition is hence, dismissed on the ground of delay as well as on merits.
-
2024 (11) TMI 789
Concessional rate of duty - manufacture of ‘Gold Dore Bars’ having purity less than 95% - Admissibility of the benefit of exemption under Sl. No.189 of the Notification No. 12/2012CE dated 17.03.2012 - HELD THAT:- We find that the Learned Commissioner, while analysing the dictionary/popular meaning of ‘Gold Bar’ and applying common parlance test to it, has categorically made an observation that the claim of the appellant that ‘Gold Bar’ includes ‘Gold Dore Bar’ cannot be accepted since there is a marked difference between ‘Gold Bar’ and ‘Gold Dore Bar’, when the meaning of ‘Gold Dore Bar’ set out in the Explanation to the said exemption Notification No.12/2012-CE dated 17.03.2012 is considered.
Rejecting the contention of the appellant that if the ‘gold bar’ be understood as having purity content of more than 95%, it amounts to introducing a new condition under the said Notification, the learned Commissioner has observed that since the percentage of gold has been specifically prescribed to understand ‘Gold Dore Bar’, then meaning of ‘gold bar’ be considered as the one other than ‘Gold Dore Bar’ being a distinct products in the trade parlance.
Argument of the appellant that even though the final product cleared from their factory is ‘Gold Dore Bar’ having purity less than 95%, which are manufactured from gold ore/concentrate be considered as ‘Gold Bar’, in absence of a definition of ‘Gold Bar’, in the exemption Notification, in our view, cannot be accepted.
On the contrary, we find there is merit in the reasoning of the Ld. Commissioner that once the ‘Gold Dore Bar’ is given a meaning in the Explanation to the Notification being considered as ‘raw material/input for the manufacture of ‘gold bar’, the said meaning cannot be ignored while understanding the meaning of ‘Gold Bar’ even though both the items are classifiable under Chapter 71 of the CETA, 1985. The ‘Gold Bars’ which are manufactured out of ‘Gold Dore Bars’ having purity less than 95% cannot be equated with ‘Gold Dore Bars’. Thus, the argument of the Appellant that Gold Bars (i.e., Gold Dore Bar) manufactured from gold ore or concentrate as mentioned at Clause (a) of Sl. No.189 of the said Notification No.12/2012-CE dated 17.03.2012, cannot be acceptable for more than one reason. The final product emerged out of the process of manufacture narrated as above, is ‘Gold Dore Bar’ having purity of 87% to 92% and not ‘Gold Bar’ and the said ‘Gold Dore Bar’ is cleared to refineries to make ‘Gold Bar’ having purity of 999.99%.
The argument of common parlance understanding of the 22-carat and 24-carat purity bar as ‘Gold Bar’ only, in our view, not relevant to the present circumstances of the case to extend the benefit of Notification. If it is the intention of the Legislature to treat both ‘Gold Bar’ and ‘Gold Dore Bar’ as one and the same, then there is no necessity to mention both the expressions in the same exemption Notification, one as ‘raw material’ and the other one as the as ‘final product’.
The principles for interpretation of an exemption Notification have been laid down in Dilip Kumar and Company [2018 (7) TMI 1826 - SUPREME COURT].
Thus even if in common parlance purity may not be the criterion to use the expression ‘Gold Bar’, however, for the purpose of Notification No.12/2012-CE dated 17.03.2012, ‘Gold Bar’ and ‘Gold Dore Bar’ are two different commodities.
Invoking extended period of limitation - We find that a proceeding was earlier initiated against the appellant in the year 2010. Analysing the process of manufacture and the final product manufactured and cleared from the factory at ‘NIL’ rate of duty, claiming exemption under Notification No.5/2006-CE dated 01.03.2006, show-cause notice was issued to the appellant on 07.02.2012 demanding duty with interest denying the benefit of Notification No.5/2006-CE dated 01.03.2006. As a Government Policy, the Notifications are amended from time to time and the exemptions are provided depending on the process, source of inputs, resultant product, etc. The appellant consequent to the amendment to the Notification No.5/2006-CE dated 01.03.2006 discharged duty on clearance of ‘Gold Dore Bar’ by availing concession as specified under Notification No.25/2011-CE dated 24.03.2011. Subsequently, also they commenced discharging duty by availing the exemption Notification No.2/2012-CE dated 16.01.2012 and Notification No.12/2012-CE dated 17.03.2012 from time to time. Also, they have filed periodical ER-1 Returns with the department indicating clearance of the ‘Gold Dore Bar’ mentioned as ‘Gold Bar’ claiming exemption available to them from time to time.
In the said circumstances, the second show-cause notice issued to the appellant on 05.08.2017 invoking extended period, in our opinion, cannot stand the scrutiny of the law as there has been no change in the process of manufacture, marketing/sale of the final product i.e., ‘Gold Dore Bar’ except availment of benefit of Notification issued from time to time. Thus, there is no mis-declaration nor suppression of facts with intent to evade payment. However, the appellants are required to discharge differential duty at the appropriate rate, if any, payable for the normal period of limitation, as benefit of Sl. No.189 of the Notification No.12/2012 dated 17.03.2012 as amended, being not admissible to the appellant. Since the issue relates to interpretation of law and there is no suppression of facts, we do not find justification in imposing penalty under Section 11AC of the Central Excise Act, 1944 on the appellant as held in the impugned order.
Appeal is partially allowed upholding the demand of duty with interest for normal period and setting aside penalty imposed on the appellant. Consequently, the matter is remanded to the adjudicating authority for determination of differential duty and interest for the normal period of limitation. Appeal disposed of accordingly.
-
2024 (11) TMI 719
CENVAT in respect of service tax paid on outward transportation under reverse charge mechanism in the admitted fact that the sale of excisable goods is on FOR basis - HELD THAT:- It is admitted fact even by the adjudicating authority in the impugned order that the sale of excisable goods is on FOR basis and in respect of supply of such excisable goods the appellant have availed the service of transportation on which the appellant have paid the service tax which has been availed as Cenvat Credit.
On the identical facts, this Tribunal has decided the matter in favour of the assessee in the case of M/S ULTRA TECH CEMENT LTD. VERSUS CCE & ST, ROHTAK [2014 (10) TMI 679 - CESTAT NEW DELHI]. In the said judgment, in the case of sale of goods on FOR basis,whenthe freight is integral part of the assessable value on which excise duty was paid, it was held that in this condition the assessee is eligible for the Cenvat Credit on outward transportation.
Recently, on the identical issue and under the same set of facts, the Hon’ble Kerala High Court in the case of TRANSFORMERS AND ELECTRICALS KERALA LTD. VERSUS THE COMMISSIONER OF CENTRAL TAX AND CENTRAL EXCISE KOCHI, THE CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL, BANGALORE. [2024 (10) TMI 623 - KERALA HIGH COURT] also taken the same view and held that 'In the instant cases, however, we find 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. Under such circumstances, we fail 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. In our view, permitting the appellant to avail input tax credit in such circumstances would militate against the very Scheme of CENVAT credit, which is designed to avoid the cascading effect of tax and an ultimate burden on a consumer. We therefore see no reason to interfere with the order of the Tribunal impugned in these appeals.'
In view of the above judgments of the Hon’ble High Court of Gujarat and Kerala High Court, the issue is no longer res-integra. Hence, applying the above judgments in the present case also, the appellant is eligible for Cenvat Credit on outward GTA service.
The impugned order is set aside, the appeal is allowed with consequential relief.
-
2024 (11) TMI 718
Failure to follow Rule 7 of Central Excise Valuation (Determination of Price of Excisable Goods) Rules, 2000 - discrepancy in calculation of duty by Revenue - HELD THAT:- In the instant case, it is noticed that the issue regarding documents and the manner of calculation has been specifically raised before the first appellate authority. Even in terms of the Tribunal order, the issue could have been raised before Commissioner (Appeals). In view of above, it is found that facts are not identical to the earlier proceedings, in so far as in the instant case, the appellant agitated issues regarding evidence in the shape of invoices before Commissioner (Appeals) which was not done in the earlier proceedings. The only dispute before Commissioner (Appeals) in the instant case was that while applicability of Rule 7 had not been challenged the manner of calculation was challenged.
There are no infirmity in the order of Commissioner (Appeals) remanding the matter back to the original adjudicating authority for fresh adjudication - The appeal filed by Revenue is therefore, dismissed.
-
2024 (11) TMI 717
Disallowance of CENVAT Credit - input/ input service - Manpower Supply Services - Anti-termite/ Pesticide treatment (Pest Control) - Security Services - Project management consultancy - Equipment hiring - contravention of provisions of Rule 2,3,4 & 9 of the Cenvat Credit Rules, 2004 - Credit denied for the reason that the credit is in respect of inputs and input services received by the appellant prior to the commencement of production - HELD THAT:- There are no such allegation in the show cause notice or any such thing in the impugned order. The credit has been sought to be denied for the reason that the inputs and input services received by the appellant do not qualify as input or input services as per the Rule 2 (k) and 2 (l) of the CENVAT Credit Rules, 2004. Appellant has placed reliance on series of decisions on this account only to mislead the bench. These decisions are not on the subject in dispute. Hence the decisions relied on this aspect do not merit any consideration.
In the impugned order after considering the inputs and input services against which the appellant have claimed the credit in light of the definitions of inputs and input services as per Rule 2 (k) and 2(l) respectively Commissioner have recorded the finding to effect that these inputs and input services fall within the exclusion clause of the said definition, and hence have denied the said credit.
In certain decisions relied upon by the appellant it has been held that though these goods and services are covered by the exclusion clause, but the credit should be allowed as it gets covered by the definition clause. In case of SOLAR INDUSTRIES INDIA LTD. VERSUS COMMISSIONER OF CE & CUSTOMS NAGPUR [2018 (7) TMI 768 - CESTAT MUMBAI], Mumbai Bench while explaining the scope of exclusion clause observed 'Something which may be covered has got to be excluded by way of exclusion. In view of the exclusion clause the arguments with regard to the coverage, the services under the definition clause first part would not be correct.'
This decision of Mumbai bench was affirmed by Hon’ble Bombay High Court as reported at SOLAR INDUSTRIES INDIA LIMITED. VERSUS THE COMMISSIONER, CENTRAL EXCISE, CUSTOMS AND SERVICE TAX, NAGPUR [2021 (12) TMI 1047 - BOMBAY HIGH COURT] observing 'It was found by the Tribunal that by virtue of the amendment dated 1-4-2011 rent-a-cab service had been excluded from the definition of the term “input service”. The same was in three limbs and the material basis for denying such Cenvat credit was in view of Clause (B) to Rule 2(l) of the said Rules. We find that the Tribunal was justified in disallowing Cenvat credit for the reasons mentioned in the impugned order.'
Affirming this decision Hon’ble Supreme Court in SOLAR INDUSTRIES INDIA LIMITED VERSUS COMMISSIONER, CENTRAL EXCISE CUSTOMS AND SERVICE TAX, NAGPUR-II [2022 (9) TMI 1155 - SC ORDER] observed 'In that view of the matter, it cannot be said that the High Court has committed any error in denying the Input Tax Credit and holding that such a service is excluded from the input service.'
Thus in view of the above decisions the goods or services which have been excluded by way of exclusion clause in the definition, could not have been said to be covered by the definition, by referring to the main clause of the definition. As observed in case of Solar Industries all such decisions which have held so are per incuriam and have no precedent value.
From the submission made by the appellant in appeal also it is evident that these chemicals were used proper construction of floor and hence would fall under the excluded category. As per Clause (B) of the exclusion clause to Rule 2 (k), “Any goods used for- construction of a building or a civil structure or a part thereof; or laying of foundation or making of structures for support of capital goods” have been excluded. Hence there are no anomaly in the impugned order denying this credit.
Modernization or renovation or repairs of a factory - HELD THAT:- The activities of Modernization or renovation or repairs of a factory will be covered by the inclusion clause of the definition and those in relation to the setting up of the factory will be covered by the exclusion clause. It is settled law that the while interpreting a Fiscal Statute the statute should be interpreted strictly on the basis of the words used in the statute - Despite being given ample opportunities, the appellant failed to provide evidence to the effect that the appellant was undertaking repair, modernization or repair of existing factory. They were asked to provide the evidence in respect of the closure of the factory in 2007 on account of labour unrest, or the returns filed by them during the prior period to show that they factory was existing and producing goods and clearing the same. As it is observed they have produced returns for the period from September 2011 onwards where in the production and clearance was indicated as “Nil” till February 2012. First time any production and clearance has been show is in Month of March 2012. Thus it cannot be accepted that the contention raised by the appellant to the effect that the works undertaken by them were in relation to repair, modernization or renovation of the existing factory.
The only issue that needs to be examined in present case and on the basis of various decisions sited by the appellant is whether these activities were in relation to setting up of the factory or in relation to renovation, repair or modernization of existing unit - In absence of any evidence we are not in position to agree with the claim made by the appellant to effect that these activities were in relation to renovation, modernization or repair of ongoing factory. In case of COMMISSIONER OF CUSTOMS (IMPORT) , MUMBAI VERSUS M/S. DILIP KUMAR AND COMPANY & ORS. [2018 (7) TMI 1826 - SUPREME COURT], Hon’ble Supreme Court has specifically held that any person claiming any exemption has to establish that he falls within the four corners of exemption notification.
The appellant have failed to comply with the test laid down by the Hon’ble Supreme Court and establish that all these activities were in relation to repair, modernization or renovation of factory we are not in position to agree the contention raised by the appellant for first time in appeal, contrary to their own admissions and submissions before the investigating and adjudicating authority.
Manpower Supply Services - Anti termite/ Pesticide Treatment Services - credit has been sought to be denied for the reason that these services were used by the appellant in relation to the construction activities of setting up of the manufacturing unit - HELD THAT:- In absence of any evidence to the contrary being made available, a contrary view cannot be taken.
It is found that appellant has availed CENVAT credit in respect of the Manpower Supply Services (April 2012 to December 2012) and Security Services (April 2012 to November 2012). This credit has been availed by the appellant after the commencement of production activities. As these services have been received by the appellant during the period after commencement of production, the denial of credit by attributing the same to setting up of the manufacturing unit cannot be justified. Thus, credit of Rs.2,94,243.66/- taken by the appellant against security services and the credits taken by the appellant towards man power supply services from April 2012 onwards is held admissible.
The appellant had even prior to issue of the show cause notice debited the entire amount of inadmissible credit which has been admitted by the adjudicating authority. He has also set aside the demand for interest. In our view this was a fit case where the proceedings should have been closed following the dictum of sub-section (2) of Section 11A of Central Excise Act, 1944. Thus, there are no merit in the penalty imposed on the appellant under Rule 15 (1) of the CENVAT Credit Rules, 2004.
Thus, quantum of demand needs to be re-determined by the original authority - Penalty imposed under Rule 15 (1) is set aside - appeal allowed in part.
-
2024 (11) TMI 716
Cenvat credit - input services - imported capital goods clearances charges, consultancy charges (other than civil), insurance charges, input GTA (only machinery related) and erection and commissioning charges (only machinery related) etc used during the setting up of their manufacturing unit i.e. prior to starting of their first commercial production - Revenue denied the Cenvat credit in the above services on the ground that these services are related to and used in setting up of the factory and since the “setting up” wording was deleted from the inclusion clause of the definition in Rule 2 (l) of the Cenvat Credit Rules, 2004, appellant are not eligible for Cenvat credit - HELD THAT:- From the reading of the above rule, it can be seen that as per the main clause of the definition given in Rule 2 (l)(ii) any service used by a manufacturer, whether directly or indirectly, in or in relation to manufacture of final product and clearance of final product up to the place of removal are considered as input service. In the present case all the services described above are undisputedly used in the factory of the manufacturer. Therefore, the same are clearly covered under the Rule 2 (l)(ii) of the definition of input services.
Similar issue has been dealt with by the Ahmedabad bench in the case of Piramal Glass Ltd [2019 (10) TMI 1032 - CESTAT AHMEDABAD] wherein the tribunal has held that 'In the present case, installation of new furnace is directly used in relation to manufacture of final product. Therefore, even as per the main clause of the definition of the input service, these services are input services and credit is rightly availed by the appellant.'
In view of the above judgment, even though the wording “setting up” was deleted from the inclusion clause of the definition but all the services are covered under the main clause of definition of input services as per Rule 2 (l) of Cenvat Credit Rules, 2004 so far these services were used by the manufacturer, directly or indirectly in or in relation to the manufacture of the final product. Therefore the cenvat credit on the subject input services are admissible.
The impugned order is set aside. Appeal is allowed.
-
2024 (11) TMI 715
Eligibility of respondent (ship breaking company) to avail cenvat credit of CVD on fuel oil, High Speed Oil and lubrication oil inside the engine room bunker available on the ship imported for breaking - the said goods form part of ship and input service under Rule 2 (a) of CCR, 2004 used in process of manufacture of final excisable product in breaking of ship - HELD THAT:- The Commissioner (Appeals) has relied upon the case of PRIYA HOLDING (P) LTD VERSUS COMMISSIONER OF CUSTOMS, PREVENTIVE [2012 (11) TMI 532 - GUJARAT HIGH COURT] wherein it was held that the fuel oil lying in the engine room is part and parcel of the ship which is imported for breaking which means the fuel oil cannot be given different treatment than the entire ship. Consequently, for the purpose of cenvat also no discrimination can be made between the entire ship and the bunker lying in the engine room. Therefore, the case of Priya Blue holding directly supports the case of the respondent.
Moreover, on a very identical issue, the tribunal in the case of Navyug Ship Breaking Co. [2023 (3) TMI 636 - CESTAT AHMEDABAD] held that 'Learned Commissioner (Appeals) has rightly held that in view of para 6 of the circular no. 1014/2/2016-CX., dated 1-2-2016, that cenvat credit of CVD paid on fuel & oils cannot be denied to the Respondent.'
The issue in hand has already been decided in the favour of the assessee. Therefore, following the ratio of the above judgment, there is no reason to deviate from the view taken therein - the impugned order is upheld. Revenue’s appeal is dismissed.
........
|
9911796707
