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Central Excise - Case Laws
Showing 401 to 420 of 81813 Records
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2024 (12) TMI 273
Suppression of facts by the respondent to evade excise duty - Interpretation and applicability of N/N. 52/2002-CE and N/N. 8/2004-CE. - whether the Notification No. 8/2004-CE dated 21.01.2004 and the amended Notification, No. 28/2004-CE dated 09.07.2004, the whole of the duty of excise leviable on the finished product was exempt or the same was chargeable Nil rate of duty and thereby the Judgment of this Hon’ble Court is squarely applicable in the present case? - applicability of Extended period of limitation.
HELD THAT:- Here in the case at hand though substantial questions of law has been framed on the issue of exemption of excise duty or suppression of material facts before the assessing authorities looking the matter from the question of limitation or of any other technicalities, this Court feels that for whatever the reasons the inspecting or audit authorities who are supposed to conduct periodical/regular audits and inspections could have raised the demand and also issued show cause notice on yearly basis but not acting upon for years together and to the surprise of the respondent, notices are issued and demand is raised before a concern to this Court and a huge amount of excise duty is important.
This Court on the ground of technicalities and for certain laches committed by the department officials as pointed out by the respondent counsel is not inclined to decide the case in favour of the respondent. But keeping in mind, the quantum of excise duty and its ancillary duties which are in total of Rs. 98,03,22,312/- approx., this Court feels that the matter needs consideration as to where the things are properly attended or not.
This Court feels that it is a case to remand back the matter to the Commissioner of Central Excise, Morellow Compound M.G. Road, Shillong-793001 in the respective cases for reconsidering the issue of purchase of the ‘compound’ i.e. kimam and the records relating to the same and make an enquiry as to who is the supplier and in the event if the supplier has already paid the sufficient excess due, the same need not be collected earlier from the respondent herein - this Court is of the opinion that the issue of levy of excise duty and considering the exemption is concerned, an opportunity needs to be given for ascertaining whether any due has been already paid by the supplier and the same needs to be considered by the Commissioner of Central Excise, Morellow Compound M.G. Road, Shillong-793001.
Appeal disposed off by way of remand.
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2024 (12) TMI 272
Maintainability of appeal filed under Section 117 of the Central Goods and Service Tax Act, 2017 - Jurisdiction of the High Court versus the Supreme Court regarding appeals related to taxability of services rendered - appropriate forum - Interpretation of Section 35L of the Central Excise Act, 1944 - HELD THAT:- Under Section 117 of the Act of 2017, an appeal lies to the High Court against any order passed by the Appellate Tribunal and the appeal may be admitted by the High Court subject to there being satisfaction that the case involves substantial question of law. The definition of Appellate Tribunal is found under Section 2 (9) of the Act of 2017 which again refers to Section 109 of the same Act. Section 109 provides for constitution of Appellate Tribunal and Benches thereof by the Government to be known as Goods and Services Tax Appellate Tribunal for hearing appeals under the order passed by the Appellate Authority or the Revisional Authority. No material has been placed to show that an Appellate Tribunal had been constituted in terms of the said provision. There also cannot be any dispute to the fact that an appeal to this Court under Section 117 would have to be an order passed by the Appellate Tribunal under Section 113 of the Act of 2017.
It may be seen that apart from the orders passed by the High Court in an appeal filed under Section 35G or a reference under Section 35H, an appeal lies to the Supreme Court from any order passed by the Appellate Tribunal relating, among other things, to the determination of any question having a relation to the rate of duty of excise or to the value of goods for purposes of assessment. Further, for the purpose of determining any question having relation to the rate of duty, the determination of taxability or excisability of goods would be included for the purpose of assessment. As may be noticed, the core issue which requires determination in the instant case is as to whether the services rendered by the respondent is taxable.
Challenge made in COMMISSIONER, CENTRAL GOODS & SERVICES TAX, GUWAHATI VERSUS M/S OIL INDIA LIMITED [2023 (5) TMI 440 - GAUHATI HIGH COURT] was to the decision of CESTAT which held that the respondent-assessee was a seller and not a service provider and hence, in absence of service provider/service recipient relationship, there could not be any question of levy of service tax and therefore, the demand could not be sustained. Accordingly, the demand of service tax interest and penalty raised by the Adjudicating Authority and affirmed by the Appellate Authority was quashed and set aside.
Coming back to the present case, upon having an overall consideration of the issue raised including the grounds of appeal taken by the appellant, since the issue of taxability of the services rendered by the respondent is the issue to be decided and therefore, the same squarely falls within the purview of the Hon’ble Supreme Court under Section 35L of the Act of 1944.
The appeal is therefore dismissed with liberty to the appellant to avail the remedy as is available in law.
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2024 (12) TMI 271
Recovery of Cenvat Credit wrongly availed and utilized along with interest under Rule 14 of the Cenvat Credit Rules, 2004 read with Sections 11A and 11AB of the Central Excise Act, 1944 and penalty - seeking demand of central excise duty in cash on the pet bottles on the ground that the appellant had cleared the goods captively during the period August, 2008 to May, 2010 - invocation of Extended period of limitation - HELD THAT:- The appellant was manufacturing pet bottles in their factory since August 2008 for captive consumption but was not paying the duty on the same and did not get the registration of the same; but in June 2010 they came to know that they are liable to pay duty and then informed the Department regarding the liability to pay duty and subsequently paid the duty for the period August, 2008 to June, 2010 out of the Cenvat Credit on inputs and capital goods and also paid the interest of Rs.8,84,585/- in cash and intimated the same to the Department vide their letters dated 13.06.2010 and 23.06.2010. The appellant also paid some amount as demanded by the Department along with interest which is not disputed.
When the appellant paid the duty along with interest voluntarily and the same was not disputed by the Department, then as per the provisions of sub-section (2B) of Section 11A of the Central Excise Act, 1944, there was no necessity to issue the Show Cause Notice - Department has wrongly relied on the provisions of Rule 8(3A) of the Central Excise Rules, 2002, because Rule 8(3A) is applicable in cases where assessees are otherwise paying duty but for certain reasons commit default in not paying duty by due date.
Also, the benefit of credit cannot be denied if subsequently duty is held to be payable on the final product.
Time Limitation - suppression of facts or not - HELD THAT:- In the present case, there is no suppression on the part of the appellant as the appellant voluntarily informed the Department vide their letter dated 17.06.2010 and subsequently paid the duty along with interest also; whereas the Show Cause Notice was issued after the expiry of more than two years which is time barred, because the ingredients for invoking the extended period of limitation do not exist in the present case.
Penalty under Rule 26 on Personal Penalty on Authorized Signatory (Individual) - HELD THAT:- Imposition of penalty is also bad in law because the ingredients for imposition of penalty under Rule 26 do not exist in the present case.
The impugned order is not sustainable in law, therefore the same is set aside by allowing both the appeals.
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2024 (12) TMI 270
Levy of Personal Penalty for aiding or abetting duty evasion - Denial of exemption admissibility of Notification No. 12/2012-CE (Sr. No. 108) dated 17.03.2012 in respect of the drugs - plea of the appellant is that the appellant’s product i.e. drugs covered under description No. (A) of the Sr. No. 108 of the table appended to the notification which does not carry condition as prescribed for description No. (v) - whether the same would fall under description (A) or (B) of Sr. No. 108 of Notification No. 12/2012-CUS? - Levy of penalty under Rule 26 of Central Excise Rules, 2012 - HELD THAT:- The drugs and bulk drugs are one and the same. Therefore, the company M/s. Sterlling Biotech Ltd was entitled for exemption Notification 12/2012-CUS entry Sr. No. 108 description (A) which does not involve any condition such as following the procedure of Central Excise (removal of goods at concessional rate of duty for manufacture of excisable goods) Rules, 2001. Therefore, entire basis of the department that such procedure was not followed is not relevant. Since, the duty demand itself is not prima facie sustainable on the company, there is no question of imposing personal penalty on the employee of M/s. Sterlling Biotech Ltd. who is the appellant herein.
The issue involved is pure interpretation of the notification. The company M/s. Sterlling Biotech Ltd had been declaring the entire facts about the availment of the notification and declaring in their ER-1 return the product discretion, notification number, Sr. number of the entry. Therefore, there was no suppression of fact or mala fide either on the part of the company M/s. Sterlling Biotech Ltd or on the part of the present appellant. For this reason, also the penalty on the appellant is absolutely unsustainable. The appellant have relied upon the decision of S K Shah [2008 (7) TMI 433 - HIGH COURT OF GUJARAT AT AHMEDABAD] Hon’ble Gujarat High Court wherein on the issue of interpretation of notification personal penalty under Rule 26 was held to be not impossible.
The penalty imposed on the appellant under Rule 26 is not sustainable. Hence, same is set aside - Appeal is allowed.
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2024 (12) TMI 269
Determination of amount of duty under sub-section (10) of section 11A of the Central Excise Act beyond the period prescribed under sub-section (11) of section 11A of the Central Excise Act - admissibility of electronic evidence - section 36B of the Central Excise Act - provisions of section 9D of the Central Excise Act relating to relevance of statements under certain circumstances were not complied with - Violation of principles of natural justice.
HELD THAT:- The show cause notice, in the present case, was issued on 28.04.2015. It called upon the noticees to show cause within thirty days from the date of receipt of notice, failing which it was specifically provided that the matter would be adjudicated ex-parte without any further communication. It is seen that the period one year from 28.04.2015 expired on 27.04.2016. Even if cause was not shown by the noticees to the said notice, the Adjudicating Authority should have proceeded to decide the matter ex-parte, but what is seen is that the Adjudicating Authority even let this statutory time limit of one year pass without even adhering to the stipulation contained in the show cause notice that the matter would be decided ex-parte even if no cause is shown within thirty days. It appears that it is only on 07.09.2016 i.e. almost after a period of five months after the expiry of one year that the first hearing was fixed by the Adjudicating Authority on 07.09.2016 - There is absolutely no reason assigned in the written submissions or in the date and event chart as to why the cross-examination process continued for almost three years from 2018 upto 2021, when the adjudication itself was required to be completed within one year. Three dates for personal hearing were fixed in 2021 at an interval of almost one month and thereafter the show cause notice was adjudicated after nine months from the last date of personal hearing on 14.06.2022.
A clear statutory time limit of one year is provided in sub-section (11) of section 11A for the Adjudicating Authority to adjudicate the show cause notice but no reason has been given in the impugned order as to why it was not feasible or practicable for the Adjudicating Authority to adjudicate the show cause notice - The Adjudicating Authority has to record reasons in the order adjudicating the show cause notice and not leave it to the department to speculate why the Adjudicating Authority could not adhere to the time limit provided to it under a Statute to adjudicate the show cause notice.
The principles of natural justice do not admit of such delayed adjudication where time limit is fixed under a Statute to adjudicate the matter. The Adjudicating Authority cannot endlessly wait and has to utilize its discretion in a fair and reasonable manner so as to balance between the principles of natural justice and the time set out in the Statute for adjudication of the show cause notice. The show cause notice required the noticees to file a reply within thirty days, failing which it was mentioned that the matter would be adjudicated ex-parte.
The impugned order would have to be set aside only for the reason that the adjudication was not completed within the time limit prescribed under sub-section (11) of section 11A of the Central Excise Act.
The impugned orders would have to be set aside and are set aside - The appeals are, accordingly, allowed with consequential relief(s), if any to the appellant.
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2024 (12) TMI 222
Refund claim - rejection on the ground that the appellant failed to establish that they reversed cenvat credit availed on common inputs utilised in the manufacture of Sulphur recovery unit - sufficient documentary evidences were not produced - violation of unjust enrichment - HELD THAT:- The refund claim was filed by the appellant subsequent to the decision of this Tribunal in the case of IOC Ltd. [2002 (12) TMI 656 - CEGAT, NEW DELHI], whereby this Tribunal has observed that Sulphur being a by-product emerges during the course of manufacture of final product, cannot be subjected to Rule 6(3)(b) of the Cenvat Credit Rules, 2002 and erstwhile Rule 57CC / 57AD(2)(b) of the Central Excise Rules, 1944.
On rejection of the refund claim, the matter reached before this Tribunal and this Tribunal categorically held that refund is admissible to the appellant but remanded the matter to the adjudicating authority to examine the issue of unjust enrichment.
Both the authorities below have travelled beyond the scope of the remand order of the Tribunal and both authorities re-examined the admissibility of credit on merit whereas observation of the Tribunal on merit was that 8% of the value of the Sulphur a by-product cannot be collected, which presupposes that proportionate cenvat credit availed on inputs had been reversed; and facts on record revealed that the appellant had reversed credit of Rs.5,27,132/-. No argument was advanced by the Revenue before the Tribunal that the said reversal was not correct. The direction of the Tribunal was that the issue of unjust enrichment be examined before sanctioning the refund. Further, it is found that the refund relates to cenvat credit reversed / paid pursuant to Rule 6(3)(b) of the Cenvat Credit Rules, 2002 and Rule 57CC / 57AD(2)(b) of the Central Excise Rules, 1944 on the Sulphur emerged as by-product - the principles of unjust enrichment could not be made applicable for the payment made under Rule 6(3)(b) of the Cenvat Credit Rules, 2002 and Rule 57CC / 57AD(2)(b) of the Central Excise Rules, 1944.
Also on scrutiny of the relevant sample invoices for Sulphur for the period in dispute, it is noticed that the amount of 8% had not been recovered by the appellant from their customers. No contrary evidence has been referred to by the authorities below to rebut the said claim of the appellant.
The impugned order is set aside - Appeal allowed.
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2024 (12) TMI 221
Utilisation of CENVAT credit taken on the input service - admissible input services or not - insurance services provided in respect of ‘Mediclaim policy taken for parent of employees’ by the appellants - levy of penalty under Rule 15(1) of CENVAT Credit Rules, 2004 - HELD THAT:- On plain reading of the provisions of Rule 2(1)(ii) of CCR, 2004, input service means 'any service used by a provider of output service for providing an output service'. In other words, if any output service is provided, services procured for providing such output services will be treated as input service in terms of rule 2 (l)(ii) of CCR,2004. The facts of the case indicate that the appellants had availed the services from the insurance company M/s Bajaj Allianz General Insurance Co. Ltd. and further provided these services to their employees for a consideration inasmuch as the appellants recovered the insurance premium from their employees - In order to render the said services to the employees, the appellants had to use the services from insurance company. Therefore, the services availed by the appellants from insurance company i.e., M/s Bajaj Allianz General Insurance Co. Ltd. for providing the said service ought to be treated as 'input service' and accordingly, the appellants are eligible to avail CENVAT credit paid on such input service in terms of Rule 2 (l)(ii) of the CCR of 2004.
The aforesaid issues have been already dealt in detail by the Coordinate Bench of the Tribunal and the present dispute is no more res integra, in view of the decision relied upon by the appellants in the cases of M/S ULTRA TECH CEMENT LTD. VERSUS COMMISSIONER OF CENTRAL TAX – TIRUPATI - GST [2019 (9) TMI 888 - CESTAT HYDERABAD]. In this case and it has been held that the appellant is required to pay service tax as per the legal provision of Service Tax statute and is entitled to avail credit on input services on the relevant output services.
Further, in the cases of M/S. SOUTH INDIAN BANK VERSUS THE COMMISSIONER OF CUSTOMS, CENTRAL EXCISE AND SERVICE TAX-CALICUT [2020 (6) TMI 278 - CESTAT BANGALORE - LB], THE COMMISSIONER OF CENTRAL EXCISE SERVICE TAX & CUSTOMS, BANGALORE (ADJUDICATION) , THE COMMISSIONER OF SERVICE TAX VERSUS M/S. PNB METLIFE INDIA INSURANCE CO. LTD. [2015 (5) TMI 68 - KARNATAKA HIGH COURT], the issue in general whether there is a liability to service tax and whether the service tax paid on input service could be eligible to the appellant was decided in their favour in these cases.
In view of the settled position of law, the issue arising out of the present dispute is no more open for any debate and as such, the impugned order passed by the learned Commissioner (Appeals) is liable to be set aside - the impugned order dated 12.11.2021 is set aside - the appeal is allowed in favour of the appellants.
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2024 (12) TMI 220
Fraudulent passing on CENVAT credit of duty to various furnace units of Punjab on the strength of their forged excise duty paid invoices - fake purchase of duty paid excisable goods i.e. MS Scrap source manufacturing units/ dealers based in Chattisgarh and Odisha - denial of crossexamination - violation of principle of natural justice - HELD THAT:- The identical issue has been decided by the Hon’ble Punjab & Haryana High Court in the case of M/S JINDAL DRUGS PVT. LTD. AND ANOTHER VERSUS UNION OF INDIA AND ANOTHER [2016 (6) TMI 956 - PUNJAB & HARYANA HIGH COURT] as well as by this Tribunal in the case of M/S LAULS LIMITED, SHRI ABHAY GUPTA, DIRECTOR AND SHRI RAM BILAS BANSAL VERSUS COMMISSIONER OF CENTRAL EXCISE, DELHI-IV, FARIDABAD, HARYANA [2023 (7) TMI 1113 - CESTAT CHANDIGARH] and M/S TIBREWALA INDUSTRIES (P) LIMITED, SHRI ANIL KUMAR TIBREWALA, DIRECTOR AND M/S R.K. TRADING COMPANY VERSUS COMMISSIONER OF CENTRAL EXCISE AND SERVICE TAX, ROHTAK [2023 (7) TMI 1112 - CESTAT CHANDIGARH] wherein it was held that the cross-examination of witnesses whose statements were relied upon by the Revenue to make out a case against the assessee has to be allowed and by following the ratio of the said decisions, the impugned order is not sustainable and therefore, the same is set aside and the cases remanded back to the Adjudicating Authority for a fresh decision after affording opportunity of cross-examination of the material witnesses and by following the procedure as prescribed in Section 9D of the Central Excise Act.
The appellants are directed to cooperate with the Adjudicating Authority for a speedy disposal of the case - both the appeals are allowed by way of remand.
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2024 (12) TMI 153
Refund of Cenvat Credit - whether, for the purpose of refund of Cenvat Credit under the Cenvat Credit Rules, 2004 supply of goods treated as “export” under the, The Special Economic Zones Act of 2005 (SEZ Act) can also be treated as export for the purposes of the Cenvat Credit Rules and Central Excise Rules, 2002? - HELD THAT:- Since the orders under challenge were passed prior to 2015, the original adjudicating and the appellate authorities did not have the benefit of the circular dated 28 April 2015, wherein it is clarified that, rebate of duty on goods cleared from Domestic Tariff Area to SEZ would be treated as export for the purposes of Cenvat Credit Rules and Central Excise Rules.
Therefore, in the interest of justice and by consent of both the parties the matter remanded back to the Appellate Authority to decide the issue afresh after considering the Circular dated 28 April 2015 and all the decisions which the parties wishes to rely upon.
Appeal disposed off.
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2024 (12) TMI 152
Recovery of Central Excise Duty with interest and penalty - Waiver of the amount of pre-deposit of Rs. 10 Crore for preferring an appeal before the CESTAT as provided under Section 35F of the Central Excise Act, 1944 - HELD THAT:- A bare perusal of Section 35F makes it clear that the petitioner is liable to make pre-deposit of Rs.10 Crores, being the minimum amount for filing an appeal before the CESTAT. This Court is, therefore, not required to examine whether there is any prima facie case in favour of the petitioner in view of the fact that after the insertion of Section 35F, no discretion whatsoever has been left for granting any waiver / reduction in the amount of pre-deposit for preferring an appeal. Therefore, this Court would not be in a position to grant waiver or to reduce the amount of pre-deposit for preferring an appeal on the ground of financial hardship as it would be contrary to the legislative intention. Moreover, this Court vide order dated 16.12.2021 has observed that the petitioner is precluded to make submissions on merits, hence, the submissions made qua prima facie case is required to be considered accordingly.
In the opinion of this Court, the petitioner has the alternative efficacious remedy of filing an appeal before the CESTAT and only on the ground that the petitioner is unable to make payment of the amount of pre-deposit, the impugned orders cannot be challenged before this Court in writ jurisdiction.
In the case of ASSISTANT COMMISSIONER (CT) LTU, KAKINADA & ORS. VERSUS M/S. GLAXO SMITH KLINE CONSUMER HEALTH CARE LIMITED [2020 (5) TMI 149 - SUPREME COURT] while considering the maintainability of a writ petition where an alternative remedy is available, the Hon’ble Apex Court held that writ jurisdiction can certainly not be exercised when invoked to undermine or defeat the applicable statutory regime.
Whether a prima facie case, as canvassed by learned advocate for the petitioner, can be considered at this stage to grant waiver of the amount of pre-deposit, which is a pre-condition for preferring an appeal before the CESTAT? - HELD THAT:- The petitioner has relied upon the decision of the Hon’ble Jharkhand High Court in SRI SATYA NAND JHA, R/O STAFF QUARTERS, KENDRIYA VIDYALAY, VERSUS UNION OF INDIA, THROUGH THE SECRETARY, MINISTRY OF FINANCE, NEW DELHI, CUSTOMS EXCISE AND SERVICE TAX APPELLATE TRIBUNAL, EASTERN ZONAL BENCH KOLKATA [2016 (7) TMI 1307 - JHARKHAND HIGH COURT], which has upheld the vires of Section 35F of the Central Excise Act, 1944 by referring to the concession made by the respondent authority that, in extreme cases, the assessee is not remedy-less and that it can prefer a writ petition. The Hon’ble Delhi High Court, while considering the aspect of wrong valuation has directed waiver of the amount of penalty in the case of MOHAMMED AKMAM UDDIN AHMED & ORS. VERSUS COMMISSIONER APPEALS CUSTOMS AND CENTRAL EXCISE & ORS. [2023 (5) TMI 23 - DELHI HIGH COURT] to grant an opportunity to the assessee to prefer an appeal. Whereas, the Hon’ble Allahabad High Court, in the case of M/S. SHUKLA & BROTHERS VERSUS CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL & OTHERS [2014 (12) TMI 1098 - ALLAHABAD HIGH COURT] has observed that the phrase “undue hardship” would also cover a case where the appellant has a strong prima facie case.
It appears that the petitioner, therefore, must satisfy this Court that he has a good prima facie case to the effect that he is likely to succeed in the appeal. In order to come to the conclusion that the petitioner would succeed in the appeal, having a good prima facie case, so as to grant waiver of the pre-condition of pre-deposit for filing the appeal, the petitioner is required to disclose a situation where he may be either subjected to gross injustice and / or misfortune or he is liable to excessive demand, contrary to the facts and evidence on record or the impugned orders are perverse, coupled with the fact that the conduct of the petitioner is blotless - Considering the facts of the case and the three tests which may be considered to arrive at a prima facie conclusion as to whether the petitioner has a prima facie case for waiver of the pre-deposit or not, it is required to examine the facts, which are recorded in the order-in-original.
Petition dismissed.
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2024 (12) TMI 151
Levy of excise duty on the transit loss up to 1% in Naphtha and ATF cleared during the relevant period meant for export - whether in view of the Notification No. 46/2001 dated 26.06.2001 read with Notification No. 17/2001 dated 04.09.2004 and Circular No. 581/2001 dated 29.6.2001 and Circular No. 804/2005 dated 04.01.2005 whether the petitioner is liable to pay excise duty on transit loss up to 1% in view of the Circular No. 261 dated 30.10.1985 issued by the CBEC? - HELD THAT:- From the findings arrived at by the revisional authority, it is clear that the revisional authority has ignored the existence of the Circular No. 46/2001 dated 26.06.2001 which is still in operation for the purpose of facility of removal of petroleum products without payment of duty for export warehousing, meaning thereby that as per Circular No. 46/2001, till the goods reached to the warehouse for the export purpose, the same would be treated as removal of petroleum products at the factory gate and the petitioner would be governed by the Circular No. 261 dated 30.10.1985 by which the petitioner is entitled to exemption from duty upto 1% of transit loss.
Reliance placed by the revisional authority on the clarification of the Circular No. 804/2005 is misplaced in the facts of the case as it pertains only to the storage loss in export warehouse/tanks whereas the petitioner has claimed the exemption from payment of excise duty on the transit loss till the products of the petitioner are stored in warehouse/tanks whether intermediate or at AFS including those with such mix-storage as per the Notification No. 261 dated 30.10.1985 which is taken into cognizance by the revisional authority in the order dated 14.02.1991 passed in the case of the petitioner.
Thus in view of the Notification No. 46/2001 not being disturbed by the CBEC read with Circular No. 261 dated 30.10.1985, the petitioner would be entitled to transit loss upto 1% for non payment of duty on the products transferred from the refinery/factory to the place of storage for the purpose of export only.
The impugned orders passed by the revisional authority cannot be sustained. The order passed by the Commissioner (Appeals) is restored to file and the demand raised in order-in-appeal regarding duty, interest and penalty is hereby quashed and set aside and all consequential orders are quashed and set aside - Petition allowed.
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2024 (12) TMI 150
Liability for duty payment on returned goods and subsequent re-manufacturing - suppression and mis-declaration of goods - recovery of entire amount of credit availed on the inputs - shortage of goods - HELD THAT:- It is noticed that the appellant at the time of first clearance of the impugned goods duly reversed the Cenvat credit that was availed by them and had issued proper tax invoices after debiting the duty on the said products. However, for whatever reasons when the goods were returned it is noticed that the appellant did inform the department in writing and subsequently has entered the said goods in their RG-23A Part-I and availed the credit in RG-23A Part-II register. These factual inputs are also part of the excise returns for the relevant periods and have been reflected in the monthly ER-1 Returns.
There is not a penny of merit in the department’s case on this pretext. Prima facie this is a case of frivolous litigation initiated at the behest of the department, which, ought to have been strictly eschewed in the first place as no case is apparently made out against the appellant having rendered the requisite information in ER-1 returns. So far as the shortage of stock of LDPE re-processed granules (3,000 kgs.) and calcium carbonate (7,950 kgs.) is concerned, the appellant in defence have submitted that the duty thereon for an amount of Rs.37,343/- has already been paid by them and they undertake to pay interest thereon.
Pursuant to the return of the goods the appellants successfully negotiated new customers for supplying the said material on which credit was availed is borne out from records. This aspect is provided in law in terms of Rule 16(2) of the Central Excise Rules and therefore cannot be faulted upon. The department having chosen to remain silent when the intimation dated 30.06.2008 upon return of the impugned goods was conveyed, it is not open for them to rake up the matter after almost 16-17 months - the said amount of Rs.11,24,760/- paid by the appellant on a charge of clandestine clearance made by the department is bereft of any valid reason thereto and cannot be sustained.
Thus, no case of imposition of penalty equal to the said amount under section 11AC of the Central Excise Act, 1944 is also made, in respect of the said amount.
Shortage of certain goods - HELD THAT:- In so far as shortage of certain goods noticed by the department during their visit on 11.06.2011 involving a duty amount of Rs.37,343/- is rightly payable by the assessee and has been reportedly paid. Nonetheless the appellant is also required to pay interest thereon and equivalent amount of penalty under section 11AC on the said amount of Rs.37,343/- - The appellant is directed to make good the amount of penalty and the amount of interest on the amount so upheld, within one month from the date of receipt of this order.
Appeal disposed off.
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2024 (12) TMI 149
CENVAT Credit - outward GTA service used in connection with clearance of excisable goods namely cement from their factory premises to buyer premises, in the fact that the cost of transportation was included in the assessable value on which central excise duty was discharged - HELD THAT:- The fact is not under dispute that the appellant have undertaken to deliver the goods at the customer’s premises. The freight charges of GTA on which cenvat credit was taken is included in the assessable value of the excisable goods. This is evident from the excise invoice raised by the appellant.
It is observed that the freight charges was not separately collected by the appellant, therefore, the same is deemed to be included in the assessable value on which the excise duty was paid. In this identical fact the issue in hand is covered by this Tribunal’s judgment in the case of Ultratech Cement Ltd [2019 (2) TMI 1487 - CESTAT AHMEDABAD] which was upheld by the Hon’ble Gujarat High Court in [2020 (3) TMI 1206 - GUJARAT HIGH COURT].
This issue was further considered by the Hon’ble High Court of Kerala in Central Excise Appeal No.17 of 2019 in the case of Transformers and Electricals Kerala Ltd vs. Commissioner of Central Tax and Central Excise Kochi/ Bangalore [2024 (10) TMI 623 - KERALA HIGH COURT], it was held that '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.'
The issue involved in the present case is no longer res-integra and accordingly the appellant are entitled for cenvat credit on outward GTA in the facts of the present case. Hence, the impugned orders are set aside - Appeal allowed.
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2024 (12) TMI 148
Dismissal of appeal for the reason that instead of filing the appeal within 60 days from the date of receipt of the order that was impugned in the appeal, the appeal was filed 3 days after the expiry of 60 days without even moving an application for condonation of delay - liability to pay central excise duty on the additional consideration collected a sales tax but not deposited with Government.
HELD THAT:- The scheme that is involved is the Rajasthan Investment Promotion Scheme, 2010 which deals with grant of subsidy, its quantum and the procedure for claiming it.
This issue, has been decided by this Tribunal in M/S HARIT POLYTECH PVT. LTD. VERSUS COMMISSIONER, CENTRAL EXCISE & CGST- JAIPUR I, GANPATI PLASTFAB LTD., M/S APEX ALUMINIUM EXTRUSION PVT. LTD., M/S MAHA MAYAY STEELS, M/S. TIRUPATI BALAJI FURNACES PVT. LTD., M/S. TRANS ACNR SOLUTIONS PVT. LTD., M/S. FRYSTAL PET PVT. LTD. VERSUS COMMISSIONER OF CENTRAL EXCISE, CUSTOMS & CGST- ALWAR [2023 (3) TMI 1120 - CESTAT NEW DELHI] where it was held that 'The subsidy amount under the promotion policy does not affect the selling price of the goods.'
The matter was not examined on merits by the Commissioner (Appeals) as the appeal was dismissed only on the ground of being barred by time. As the issue on merits has been decided by the Tribunal, it is appropriate not to remand the matter to the Commissioner (Appeals) for passing a fresh order and have proceeded to decide the appeal on merits.
The impugned order dated 17.01.2020 passed by the Commissioner (Appeals) and the order dated 22.03.2019 passed by the Superintendent are, therefore, set aside - appeal is allowed.
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2024 (12) TMI 78
Maintainability of appeal - enhancement in the monetary limit for preferring appeal - HELD THAT:- Insofar as this Court is concerned, the monetary limit has been increased to Rs.5 crores.
Appellant states the amount under consideration for the present appeal is Rs. 3,30,81,801/- - In that view of the matter, he does not want to press the present appeals. The appeals are, accordingly, disposed of.
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2024 (12) TMI 77
Denial of CENVAT credit - levy of penalties - huge physical shortage of raw materials, than the recorded stock - HELD THAT:- It is found that the impugned order was passed on the same issue in the matter of four show cause notices. In the matter of two show cause notices bearing Nos. DGCEI/AZU/36-105/2014-15 dated 15.07.2015 and DGCEI/AZU/36-106/2014-15 dated 15.07.2015, this Tribunal in ANUPAM INDUSTRIES LIMITED, DHARAMPAUL ASSOCIATES, KESHAV STEEL AND MEHUL PATEL VERSUS COMMISSIONER OF C.E. & CUSTOMS-ANAND [2024 (6) TMI 842 - CESTAT AHMEDABAD] allowed the appeals by setting aside the impugned order. Since the present appeals are out of the same impugned order involving same issue and identical facts, the issue in the present case is no longer res-integra.
In view of above order, it can be seen that issues in the present appeal as well as in the appeals disposed of by the above order are identical in all respect, therefore, following the ratio of the above decision, in the present case also, the demand is not sustainable.
Appeal allowed.
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2024 (12) TMI 76
Reversal of CENVAT Credit on input services - amount of 10.3% reversed by the appellant in terms of Rule 6(3) of Cenvat Credit Rules, 2004 - application of Section 11D of Central Excise Act, 1944 - HELD THAT:- From the plain reading of Section 11D, it is found that firstly the recovery under Section 11D can be made only when an asseesee recovers any amount in the name of excise duty and does not deposit to the government exchequer. In the present case the amount so recovered, firstly not a duty of excise and secondly, the same amount has been reversed by the appellant. Therefore, on both the counts Section 11D cannot be invoked. This very issue has been clarified by the CBEC Circular No.870/08/2008-CX dated 16.05.2008 - From the circular it is has been clarified that any amount reversed under erstwhile Rule 57CC of Central Excise Rules, 1944 or Rule 6 (3) (1) of Cenvat Credit Rules, 2004and even though the same is recovered from the customers, the provision of Section 11D shall not apply. Therefore, the present issue stands clarified by the board under the aforesaid circular.
Thus, the amount reversed by the appellant under Rule 6(3) and even though recovered from the customer, provision of Section 11D shall not apply. Hence, the demand under Section 11D is not sustainable.
The impugned order is set aside - Appeal is allowed.
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2024 (12) TMI 75
Clandestine removal - evasion of Central Excise Duty by diversion of duty paid inputs i.e. imported plastic granules of various grades from Mumbai port to Halol, Ahmedabad, Vadodara, Vapi - non-receipt of the inputs in the factory of the Appellant - shortages of finished goods detected at the time of visit of the officers - denial of Cenvat credit.
Evasion of duty - HELD THAT:- Inasmuch as in the present case the entire case of the Revenue is based upon the shortages detected at the time of visit of the officers, without there being any other evidence. It is seen that the judicial view is that the stock taking would be conducted in a proper manner and considering all the stock lying in the factory. It cannot be on the basis of eye estimation or otherwise. The Hon’ble Gujarat High Court in the matter of COMMR. OF C. EX., CUS. & SER. TAX, DAMAN VERSUS NISSAN THERMOWARE P. LTD. [2010 (12) TMI 487 - GUJARAT HIGH COURT], observed that mere statement of the representative of the assessee at the time of stock verification is not sufficient which was retracted subsequently. The confessional statement of an accused in criminal proceedings cannot be put on a par with a statement recorded during preventive checks - In the present case, it is found that Appellant claimed that the said materials were lying at their factory and during the search officers not considered the finished goods available in various sections/sheds, appellant also produced the CCTV footage which was also not considered by both the adjudicating authority and no enquiry was conducted thereon - the shortage found at the time of physical verification is not sustainable and that the allegations in the instant case of clandestine removal of the finished goods is not sustainable Accordingly, demand on this account is set aside.
Denial of Cenvat credit of Rs. 72,91,056/- on the allegation that the appellant has availed Cenvat Credit on the strength of invoices issued by M/s. Siddhi Trading Corporation, M/s Eskay-Bee International Pvt. Ltd., M/s. Deluxe Karan Imports Pvt. Ltd. and M/s. Kookey Multi Trading Corporation without receipts of the inputs in their factory - HELD THAT:- On perusal of orders we find that the request for cross-examination of the persons whose statements have been relied upon has been turned down on the ground that witnesses did not appear for cross –examination. The reasons assigned by the Ld. Adjudicating authority below to reject cross-examination is clearly unsustainable in legal parlance for the obvious reason that no adverse inference can be drawn against assessee whose statements are to be relied by the Revenue without ascertaining the veracity in the absence of cross-examination - In an almost identical situation, this Tribunal in the case of ARSH CASTINGS PVT. LTD. VERSUS COLLECTOR OF CENTRAL EXCISE, CHANDIGARH [1995 (9) TMI 156 - CEGAT, NEW DELHI] has observed that 'If witness do not turn up for cross-examination, it is open to the adjudicating authority to proceed with the adjudication without relying on these statements against the person so charged. Failure of a witness to appear for cross-examination will not be a ground to penalise the appellants in law when the appellant is entitled to an opportunity of cross-examination of third party on whose statement’s reliance is placed.'
The statement of persons whose cross-examination was allowed but they do not turn up for cross-examination cannot be relied upon and have to be excluded from evidences. On the basis of said statements no cenvat demand is sustainable. Revenue if chooses not to examine any witnesses in adjudication their statement are not considerable as evidence - the Tribunal in the case of M/S NIDHI AUTO PVT. LTD. VERSUS COMMISSIONER OF CENTRAL EXCISE, NOIDA-I [2019 (6) TMI 899 - CESTAT ALLAHABAD], while relying on the ratio laid down by the Hon’ble High Court in the case of Parmarth Iron Pvt. Ltd. has held that when the Revenue does not allow cross-examination of any prosecution witness then Revenue cannot rely on the statement given by such prosecution witness for confirmation of demand.
In the present matter receipts of the goods in factory clearly established by the Appellant with documentary evidences. Further, the investigation is silent as to how the Appellant-manufacturer, manufactured finished material without receiving the inputs. The law is settled that as long as duty payment is accepted on outputs, the benefit of credit available on input cannot be denied. Therefore, there are no substantial evidences which result the disallowance of credit - the appellant have satisfied the requirement of receipt of inputs along with cenvatable invoices in their factory and accordingly, the Cenvat credit taken by them is in accordance with the scheme of the Act read with Cenvat Credit Rules.
The impugned order is set aside - appeal allowed.
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2024 (12) TMI 74
Refund claim of CVD and SAD paid - non-fulfilment of export obligations in respect of goods imported before 01.07.2017 under AA and EPCG schemes - HELD THAT:- The appellant have paid CVD & SAD for the relevant period that is prior to 01.07.2017 at that time the appellant was eligible for Cenvat credit in respect of CVD & SAD, since the said duties were paid after 01.07.2017, neither the same could have been used as Cenvat credit under Cenvat Credit Rules, 2004 nor the same can be credited to electronic credit ledger to meet these eventualities. The legislature have provided the refund of the said amount under Section 142 (3) of CGST Act, 2017 read with Section 11B of Central Excise Act, 1944. Therefore, there is absolutely no ambiguity in the provision for refund of such duties which was availed as Cenvat credit for the period prior to 01.07.2017 in terms of Section 142 (3) of CGST Act, 2017.
This issue is no longer res-integra as the same has been decided in various judgments - In CCE v. Aculife Healthcare Pvt. Ltd [2024 (5) TMI 190 - CESTAT AHMEDABAD] wherein, this Tribunal has upheld the granting of refund to the assessee of CVD & SAD paid after introduction of GST, on imports made prior to introduction of GST, due to non-fulfilment of export obligations. This Hon’ble Tribunal has upheld the granting of refund under Section 142(3) of the CGST Act, 2017 read with Section 11B of Central Excise Act, 1944, after taking into consideration the judgment of the Hon’ble Tribunal at Chennai in the case of Servo Packaging Ltd. [2020 (2) TMI 353 - CESTAT CHENNAI].
The appellant are legally entitled for the cash refund of Cenvat credit of CVD & SAD, eventhough, paid after 01.07.2017 in terms of Section 142 (3)of the CGST Act, 2017.
The impugned order is not sustainable, hence the same is set aside. The appeal is allowed.
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2024 (12) TMI 73
CENVAT Credit - availment of credit based on forged invoices without getting material - rejection of cross-examination of witnesses - violation of principles of natural justice - HELD THAT:- This Tribunal in the case of M/s Mittal Ceramics [2024 (11) TMI 397 - CESTAT CHANDIGARH] arising out of the same investigation, has remanded the matter back to the adjudicating authority for a fresh decision after affording opportunity of cross-examination of the material witnesses after relying upon the decision of the Hon’ble Punjab & Haryana High Court in the case of Jindal Drugs Pvt. Ltd. Vs UOI [2016 (6) TMI 956 - PUNJAB & HARYANA HIGH COURT] as well as by this Tribunal in the case of M/s Lauls Ltd. [2023 (7) TMI 1113 - CESTAT CHANDIGARH] and M/s Tibrewala Industries (P) Limited [2023 (7) TMI 1112 - CESTAT CHANDIGARH] wherein it was held that the cross-examination of witnesses whose statements were relied upon by the Revenue to make out a case against the assessee has to be allowed. By following the ratio of the above said decisions, the impugned orders are not sustainable and therefore, the same is set aside and the cases remanded back to the Adjudicating Authority for a fresh decision after affording opportunity of cross-examination of the material witnesses and by following the procedure as prescribed in Section 9D of the Central Excise Act.
The appellants are directed to cooperate with the Adjudicating Authority for a speedy disposal of the case - appeals are allowed by way of remand.
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