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Central Excise - Case Laws
Showing 421 to 440 of 81715 Records
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2024 (11) TMI 398
Challenge to actions on the part of the respondent CIL in issuance of respective debit notes - recovery of amounts on account of arrears of central excise duty and corresponding VAT/CST from 01.03.2011 to 28.02.2013 against the coal purchase from the CIL by the petitioners - failure to provide details - appropriating from other transactions carried out between the CIL and the petitioners - HELD THAT:- One aspect is very clear that the petitioners herein have not assailed as to whether the stowing excise duty as well as the royalty would form a part of the transaction value on which the central excise duty is liable to be paid. Under such circumstances, what transpires from the materials on record, as well as the submissions so made by the learned counsels appearing on behalf of the parties is that the CIL is trying to recover certain amounts from the petitioners by issuance of these debit notes along with the enclosures.
It is relevant to take note of the submissions of the learned counsel for the petitioners wherein it was emphasized that basing upon the debit notes and the enclosures, the respondent CIL is trying to recover from other transactions carried out by the petitioners with the CIL. This Court is of the opinion that the issuance of the debit notes along with the enclosures can at best be construed to be demands made by the CIL upon the petitioners. If such demands are rejected and the petitioners refuse to pay, the same would result in a dispute between the respondent CIL and the petitioners.
This Court is of the opinion that by issuance of a debit note, the CIL cannot recover such amounts from other transactions. However, in terms with Clause 11.12 of the Spot E-Auction Scheme 2007, it is the opinion of this Court that if the CIL wants to recover such amounts, the said amounts can be recovered by the process mandated in the said Scheme i.e. by way of Arbitration - Petition disposed off.
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2024 (11) TMI 397
Recovery of inadmissible Cenvat credit along with interest and imposition of penalty - Fraudulent availment of Cenvat credit based on fake invoices - denial of cross-examination of witnesses - Applicability of Section 9D of the Central Excise Act - principles of natural justice - HELD THAT:- The identical issue has been decided by the Hon’ble Punjab & Haryana High Court in the case of Jindal Drugs Pvt. Ltd. [2016 (6) TMI 956 - PUNJAB & HARYANA HIGH COURT] as well as by this Tribunal in the case of M/s Lauls Ltd. 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 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.
Both the appeals are allowed by way of remand - The appellants are directed to cooperate with the Adjudicating Authority for a speedy disposal of the case.
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2024 (11) TMI 344
Imposition of penalty under Rule-26 of the Central Excise Rules, 2022 on the Appellant who was Director of sales and marketing of co-noticee Company - Non-responsive attitude of the Respondent Department - Interpretation of the "Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019" - HELD THAT:- Even after noting in his order that Appellant looked after Sales and Marketing activities of goods produced by the Appellant company, he is fastened with penal liability for manufacture of the goods by the Appellant Company and since excise duty is on the manufacture and its sales and marketing are post occurrence activities, in which Appellant was apparently engaged, there can not be a personal liability on the Appellant when learned Commissioner himself has noted that Appellant was part of the team entrusted with the task of determining the pricing of various products and regarding his duty concerning payment/nonpayment of appropriate excise duty, nothing is available in the entire case records to implicate him as a person equally responsible for evading payment of tax.
Therefore, it is a fit case where Appellant is in a win win situation for the reasons that the order of penalty imposed on him has already been set aside by CESTAT and no further proceedings like re-adjudication or Appeal was initiated against him and thereby the order passed by the CESTAT in 2015 has become final, apart from the fact that even without an application from the Appellant under the “Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019”, penalty recoverable from him should be treated as “NIL” in view of operation of section 124(1)(b) of the Amended Finance Act, 2019 and that the charge labelled against Appellant imposing penalty as a punishment is as such, unsustainable in both law and facts.
There exists no re-adjudication scope - Appeal allowed.
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2024 (11) TMI 343
Contravention of provisions of Rule 8(3A) of the Central Excise Rules, 2002 - failure to make full payment of duty within prescribed time limit as provided under Rule 8 of Central Excise Rules, 2002 - bar on utilization of CENVAT credit for payment of duty - invocation of Extended period of limitation - penalty - HELD THAT:- The issue as to whether the Assessee can utilise the CENVAT credit toward payment of duty when in default is no more res integra and many judicial authorities have held that the provision of Rule 8(3A) of Central Excise Rules, 2002 as ultravires to the Main Act. The Hon’ble Gujarat High Court in the case of INDSUR GLOBAL LTD. VERSUS UNION OF INDIA & 2 [2014 (12) TMI 585 - GUJARAT HIGH COURT] struck down the condition in Rule 8(3A) for payment of duty “without utilizing the CENVAT credit” as unconstitutional and invalid.
The Hon’ble High Court of Bombay in the case of THE COMMISSIONER OF CENTRAL EXCISE & CUSTOMS NASHIK – II COMMISSIONERATE VERSUS M/S. NASHIK FORGE PVT. LTD. [2018 (9) TMI 1582 - BOMBAY HIGH COURT] has held that Rule 8(3A) to be unconstitutional as it infringes upon the substantive right of an assessee to utilize Cenvat credit. Further, the Tribunal in the case of INDUS TROPICS LTD VERSUS C.C.E. & S.T. -RAJKOT [2023 (3) TMI 950 - CESTAT AHMEDABAD] has followed the decisions of various High Court to set aside the demand alleging violation of Rule 8(3A) of Central Excise Rules, 2002.
The appeal was referred to the Lok Adalat proceedings before the Hon’ble Supreme Court and settlement has been arrived at. The effect is that the stay order having merged with the order of settlement, stands vacated. The decision rendered by the Hon’ble High Courts of Gujarat and Madras in the above cases would revive and be in force as a Precedent.
The demand raised alleging violation of Rule 8(3A) cannot sustain and requires to be set aside - Appeal allowed.
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2024 (11) TMI 285
Requirement of pre-deposit to be made pending disposal of the appeal - HELD THAT:- In the peculiar facts and circumstances of the case and without having any implication on the statutory provision, the interim order is confirmed and the Customs Excise and Service Tax Appellate Tribunal are directed to dispose of the appeal on merits.
The appeal is disposed of.
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2024 (11) TMI 203
Eligibility for exemption Notification No.10/2006-CE dated 01.03.2006 - SSI exemption - misclassification of goods - Parts of Kitchen/ table wares, Toilet Items, SS Box, Sigree/Tandoor and Brass Knobs - determination of ratio of the value of such items out of the total clearance value of the year 2012-13 - HELD THAT:- It is clear that during 2014-2015 no such items were cleared by the Respondent.
The Department has filed the appeal without application of mind, as the Order-in-Original clearly states the analogy which was adopted for quantifying the amount prior to 2011 as stated above. The Department, without reading the order, has filed the appeal in a vague and perverse manner which is liable to be dismissed. Furthermore, the Department has again failed to give or suggest any other method logically or evidence that the computation made by the commissioner was incorrect or arbitrary. He has adopted a reasonable method for computation.
The issue in dispute in appeal is strictly restricted to the period prior to February, 2011 for which the Adjudicating Authority has used the 'analogy to calculate the value of duty leviable on the manufacturing of these 4/5 items prior to February, 2011. The demand in SCN for the same period is upto Rs.48,35,361/-. This demand of duty is below the monetary limit for filing the appeal before the Tribunal, hence this appeal itself is not maintainable. The amount stated in the appeal is incorrect as the dispute pertains to the period prior to 2011.
In the Order-in-Original the Adjudicating Authority stated that these 4/5 items were eligible to SSI exemption for the period prior to 01.03.2011. However, this seems a typographical error as the SSI exemption was available till 31.03.2011.
There are no infirmity in the impugned order - The appeal is dismissed.
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2024 (11) TMI 202
Violation of principles of natural justice - no personal hearing has been conducted by the adjudicating authority - Valuation of lighting fixtures supplied to brand owner - levy of separate penalty on a partner of a partnership firm - levy of redemption fine - goods are not available.
Principles of natural justice - HELD THAT:- It is found that in the entire case, no personal hearing has been conducted by the adjudicating authority though, the adjudicating authority has given a notice of hearing on 21.09.2017 but by one notice two consecutive date of hearing i.e. 03.10.2017 & 13.10.2017 was fixed. In this regard, it is found that it is a settled law that by giving one hearing notice letter even though, two or three dates are given it is to be considered as one date of hearing and as per the statute, minimum three opportunities of personal hearing is required to be given to the assessee. Moreover, the appellant also filed a letter dated 29.11.2017 explaining the reason for non attendance and requested for a fresh date of hearing. However, by that time, the adjudication order came to be passed. As regard the second show cause notice, even though, hearing is conducted but the order was passed on the same line of the order passed in the show cause notice dated 30.03.2017. Therefore, taking total stock of the proceeding, there is a clear violation of principles of Natural Justice in adjudication of the show cause notices.
Levy of personal penalty on Shri Ashwin Dias - HELD THAT:- It is found that Shri Ashwin Dias is undisputedly partner of M/s. Art Luminaires which is a partnership firm. The Hon’ble jurisdictional High of Gujarat in the case of COMMISSIONER OF CENTRAL EXCISE VERSUS JAI PRAKASH MOTWANI [2009 (1) TMI 501 - GUJARAT HIGH COURT] & judgment in the case of SHAH PETROLEUMS AND SNEHAL ARVINDBHAI SHAH VERSUS C.C.E. & S.T. -SURAT-II [2023 (2) TMI 67 - CESTAT AHMEDABAD] held that in case of partnership firm, no separate penalty can be imposed on the partner. In view of the settled legal position by the Hon’ble High Court of Gujarat irrespective of any merit of the case, the personal penalty on Mr. Ashwin Dias is clearly not sustainable. Hence, the same is set aside.
Levy of Redemption Fine - goods are not available - HELD THAT:- It is found that the Ld. Commissioner (Appeals) is absolutely correct in setting aside the redemption fine, as the issue is squarely covered by the Larger Bench judgment in the case of SHIV KRIPA ISPAT PVT. LTD. VERSUS COMMISSIONER OF C. EX. & CUS., NASIK [2009 (1) TMI 124 - CESTAT MUMBAI - LB] wherein, it was held that when the goods are not available for confiscation no redemption fine can be imposed. Therefore, there are no infirmity in the order of the Commissioner (Appeals) to the extent, it set aside the redemption fine.
Appeals are allowed by way of remand to the adjudicating authority for passing a fresh order by observing the principles of Natural Justice.
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2024 (11) TMI 201
Reversal of excess input service credit - Distribution of input service credit of the common input credit of various input services distributed by their Head Office situated at Thane (Mumbai) - Department is of view that since the appellants Head Office is who providing output service, the Head Office of the appellant has not proportioned input credit going for providing output service at cleared and therefore distribute the input service credit amounts three units in excess - HELD THAT:- The fact is noted that the show cause notice on the similar issue were also issued to the appellant is other units situated at Tamil Nadu and Uttar Pradesh.
The matter have already been decided by the Division Bench of this Tribunal in M/S COVESTRO (INDIA) PVT. LTD. VERSUS COMMISSIONER OF CENTRAL EXCISE [2024 (3) TMI 1367 - CESTAT ALLAHABAD] wherein, the appeal of the appellant has been allowed by this Tribunal. The matter is no longer res Integra as the issue has already been decided by this Tribunal in the appellant’s own case on the same issue where it was held that 'It is found that exactly the same issue in case of Appellant’s Tiruchirapalli unit has been decided by the Chennai Bench vide Final Order [2023 (2) TMI 7 - CESTAT CHENNAI], observing that 'There is also nothing brought out on record if the appellant, being a recipient unit, had any role or influence in the manner of distribution so that a case of wilful suppression with an intention to evade payment of duty, etc., could be justified. When the appellant took consistent stand inter alia that its Head office-ISD unit was regularly filing its ER-1 return, that the service provider unit at Head Office had Service Tax liability every year, which was paid in cash and that the entire tax liability was paid in cash every year rather than paying through the CENVAT Credit, the lower authorities have not denied anywhere the above facts.''
Following the above decision of this Tribunal in the appellants own case on the same issue it is decided that impugned order in appeal is devoid of any merit and therefore, the same is set aside - appeal allowed.
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2024 (11) TMI 200
Clandestine removal - Recovery of central excise duty with interest and penalty - demand was confirmed, basically relying on the admissions made by the authorized signatory of the appellant company regarding shortage of finished goods and the raw materials - invocation of Extended period of limitation - penalty - HELD THAT:- While considering the issue of clandestine removal, the statement dated 17.01.2015 of Shri Shikhar Agarwal recorded under Section 14 of the Central Excise Act, 1944 is relevant to be taken note of, where he accepted that he was part of panchnama proceedings and was present throughout.
From the above contents of his statement, it is evident that Shri Shikhar Agarwal had admitted the shortage of the finished goods and the raw materials and also the removal of the goods without payment of duty and without accounting thereof in the records. Further, he agreed with the verification of records with physical stock by the officers and accepted the lapse of the stock found short. Coupled with the admissions made by Shri Shikar Agarwal, the modus operandi of the appellant of not maintaining any kind of Daily Stock at the factory premises, not making entry of final products in the daily production register, not issuing any invoices in respect of excisable goods cleared and neither declared the production and clearance of excisable goods so manufactured and cleared in the ER-1 Returns only reflects that shortage of the finished goods and the raw materials during the physical verification at the time of preventive check is evident of the fact of clandestine removal with intent to evade payment of duty.
The objection raised by the appellant that search was without search warrant is not sustainable as per the records made available and considered in the impugned order. The Revenue has placed on record the authorization dated 15.01.2015 by the Additional Commissioner (Preventive) to the Superintendent (Preventive) authorizing him to search the premises, etc. of the appellant. From the impugned order, it is found that the Commissioner (Appeals) had categorically noted that the panchnama makes it clear that the search warrant was shown to Shri Ram Avtar Agarwal, Director of the appellant and he had signed the search warrant - the notices for personal hearing issued on various dates sent by speed post were not returned or un-delivered. The contention of the appellant stands duly dis-proved by the documentary evidence placed on record by the Revenue.
Invocation of Extended period of Limitation - Penalty - HELD THAT:- The invocation of extended period of 5 years under Section 11 A (4) of the Act is correct and this being a case of deliberate suppression of facts regarding production and removal of goods, the penalty has been rightly invoked under Section 11AC(1)(c) of the Act.
The demand of duty along with interest and penalty is confirmed - there are no infirmity in the impugned order and hence, the same is affirmed - appeal dismissed.
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2024 (11) TMI 126
Assessment of excise duty - levy of interest and penalty - evidence of manufacture of excisable goods by the appellant - initiation of proceedings based on the ‘registers and loose sheets’ recovered from the premises of the appellant without corroboration of the manufacture done and the clearance effected of excisable goods - HELD THAT:- The two questions of law framed are mixed questions of law and fact. The questions of law were also framed on the ground taken by the assessee that there was no evidence regarding the manufacture of excisable goods by the appellant and the proceedings were based only on registers and loose sheets which cannot lead to imposition of penalty without anything substantiating manufacture.
The allegation against the imposition of penalty is that there is no evidence to establish manufacture and clearance of manufactured goods without payment of excise duty - the imposition of penalty was not on account of the allegation of clearance of excisable goods without payment of duty alone as was noticed in the narration of facts. There was excess stock found on verification, there was excess raw materials found to have been consigned to the appellant in two trucks which were examined by the inspection team at the premises of the appellant; on which examination and proper weighment done, presence of raw material in excess of that declared in the invoice was found. In addition to this was the allegation of manufacture based on the documents recovered from the premises of the appellant on inspection.
Insofar as the excess of 3.280 Metric Tonnes of Forged Steel Grinding Media Balls; the same was detected on proper stock verification conducted in the presence of two employees of the appellant. The stock verification report was the basis of the allegation so levelled of excess stock found - With respect to the clearance of excisable goods without payment of duty, the records recovered from the premises of the appellant on inspection was relied on specifically in paragraph no. 10 of the show cause notice. The calculation chart was also annexed as Annexure-XXI along with the show cause notice.
Brims Products [2008 (9) TMI 603 - PATNA HIGH COURT] was a case in which some loose papers were recovered from the dustbin of the premises of the manufacturer. It was found that the manufacturer assessee had received some consignments of betel-nuts which were not entered in the stock register maintained; specifically four numbers of consignments. A clean chit was given to the assessee with respect to two consignments finding no actual purchase having been made by the manufacturer of the raw materials - The investigation was confined to the transporters of the consignments and there could be no presumption drawn of a manufacture and removal of the final product. Even if it is assumed that some raw materials were received at the factory of the respondent, the same cannot be a conclusive proof of production and clandestine sale to different parties was the finding recorded. Due to lack of paucity of evidence benefit of doubt was given to the assessee in that case - it is not convincing that the facts apply to the present case.
It is already noticed that the proceedings were initiated on three counts (i) the excess stock found on stock verification, (ii) the excess raw material found physically on inspection of two trucks found at the premises of the appellant with raw materials consigned to the appellant supported by invoices drawn in favour of the appellant but revealing far less quantity than that loaded in the vehicles and (iii) the production details as obtained from the registers, note-pads and loose sheets recovered from the premises. It cannot at all be said that there was no evidence indicating production of excisable goods. The registers, note-pads and cash-books maintained by the assessee clearly indicated the production of the finished product far in excess of that revealed in the books of account, as having been cleared after paying excise duty. It is found on facts that there was sufficient evidence to support the allegation of production in excess of that cleared by payment of excise duty.
There are absolutely no reason to entertain the appeal, having found the factual premise to have been adjudicated properly by the adjudicating authority and the appellate Tribunal, there are absolutely no reason to interfere with the order passed.
The questions of law answered in favour of the Revenue and against the assessee - appeal dismissed.
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2024 (11) TMI 125
Clandestine manufacture and its clearance - Recovery of Central Excise Duty along with interest and penalty as well as for appropriation of the amount deposited by the petitioner during the investigation against differential duty payable - suppression of facts and misrepresentation by the petitioner - adjudicating authority did not consider the reply submitted by the petitioner while passing the impugned order as no reference to the materials placed by the petitioner by way of the reply has been referred to in the impute order - assessment period is covered by earlier orders passed by the co-ordinate authorities - Principles of natural justice - principles of res-judicata.
HELD THAT:- A careful perusal of the order of the first appellate authority reveals that the core issue before the appellate authority was the capacity of production of the concerned machine. The appellate authority, on the basis of the materials available for the authority, concluded that the capacity of the machine was ‘301-750’ pouches per minute and which was a finding recorded by the adjudicating authority for the earlier periods. The subsequent order passed by the adjudicating authority vide order dated 27.11.2015, whereby the capacity of the machine was found to be above ‘751 pouches’ minute was held to be not based on correct information/evidence.
The questions which are raised in the present petition are essentially questions of facts based on the records and the evidences available before the Departmental authorities. There is no dispute that for several periods earlier the petitioner filed in the proper form the speed of the packing machines and which was duly approved by the adjudicating authority. The first appellate authority by its order dated 30.08.2016 interfered with the order passed on 27.11.2015 by the adjudicating authority holding the same to be not based on the evidences/the records available. There is clear finding that there was no element of suppression or misrepresentation as could be inferred from the records available - The findings of fact arrived at by the first appellate authority as seen from the order dated 30.08.2016 has not yet been interfered with by a still higher authority, namely the second appellate authority as prescribed in the statute, namely the CESTAT, Kolkata before which the appeal being appeal No. E/7689/2016-EX (DB) preferred by the respondent authority is presently stated to be pending. Therefore, the findings arrived by the first appellate authority are binding on the adjudicating authority and the adjudicating authority is duty bound in law to maintain the judicial discipline and accept the findings of the first appellate authority unless the same are interfered with by a still higher authority and/or an appropriate judicial forum. Such is not the position as on date and which is not in dispute.
In ABDUL KUDDUS VERSUS UNION OF INDIA (UOI) AND ORS. [2019 (5) TMI 1856 - SUPREME COURT], the Apex Court while examining the orders passed by collateral quasi- judicial bodies held that where a judicial or a quasi judicial tribunal gives a finding on law or fact, its findings cannot be impeached collaterally or in a second round and are binding until reversed in appeal by way of writ proceedings. The characteristic attitude of the judicial act or a decision is that it binds, whether right or wrong. Thus, any error either of fact on law committed by such bodies cannot be controverted otherwise than by way of an appeal or a writ unless the erroneous determination relates to the jurisdictional matter of that body. The Act and power of judicial review vested with the constitutional courts provide sufficient safeguards, in the present context.
Mere submissions by the counsel appearing for the respondents without supporting facts and materials before the Court cannot be accepted to arrive at a conclusion that the reply filed by the petitioner was suitably considered by the respondent authority. Under such circumstances, prime facie, it appears that the impugned order passed by the Principal Commissioner was passed in violation of the basic principles of natural justice as the reply filed by the petitioner was not found to have been duly considered by the respondent authority upon careful perusal of the impugned order.
In COMMISSIONER OF CUSTOMS, KANDLA VERSUS M/S. ABM INTERNATIONAL LTD. & ANR. [2015 (8) TMI 1118 - SC ORDER] on the question of principle of res judicata, the Apex Court held that it is not in dispute that the first round of litigation, the matter had come up to this Court and was decided in favour of the respondent assessee. While dismissing the appeal of the Revenue, considering the facts of this case, no doubt this Court left the question of law open. However, that could not be a ground to reopen the case of the Revenue. The Apex Court is therefore of the opinion that the Customs, Excise and Service Tax Appellate Tribunal has rightly applied the principle of res judicata.
The first Appellate authority namely the Commissioner (Appeals) on the basis of the materials and records available with the department returned a clear finding on facts that there was no willful or deliberate suppression of material or information. The Commissioner (Appeals) returned a finding that there were amply opportunity prescribed under the provisions available to the adjudicating authority to make necessary enquiries including physical verification before approval of the declaration and which was admittedly not done by the adjudicating authority. The Commissioner (Appeals) recorded a categorical finding that there were no records/evidences of clandestine removal of finished products by the petitioner during the period from June 2015 to October 2015 to show any mala fide intention on their part and any such reasoning given by the adjudicating authority was not supported by facts - the very foundation on the basis of which the show cause notice and the enquiry proceeded against the petitioner under Section 11A of the Central Excise Act ceases to exist. Such action by the department will amount to invocation and/or usurpation of jurisdiction when the circumstances clearly indicate that the departmental authorities ought not to have invoked its jurisdiction under Section 11A of the Central Excise Act.
This Court having arrived at a conclusion that until the findings of fact in the Commissioner (Appeals) in its order are not interfered with by a higher statutory forum or an appropriate Court of law, this finding of fact cannot be ignored by the departmental authorities and consequently the invocation of jurisdiction under Section 11A in the absence of any deliberate or willful suppression or mis-statement of facts by the petitioner, no proceedings can be initiated under Section 11A as have been sought to be done.
This Court is of the view that the writ petitioner cannot be non-suited on the ground of availability of alternative remedy. This court is of the considered view that the alternative remedy prescribed under the statute will not be an efficacious and effective alternative remedy to the present petitioner in the attending facts and circumstances of the case. The submission of the respondents that the writ petitioner should be dismissed on the ground of alternative remedy cannot be accepted and is therefore rejected.
Petition allowed.
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2024 (11) TMI 124
Rejection of Assessee’s appeal on the ground of non-compliance of payment of pre-deposit as required under provisions of Section 35 F of the Central Excise Act, 1944 - CENVAT credit - process amounting to manufacture or not - activities of packing/ re-packing/ labelling/ re-labelling/ affixing of new MRP on the goods ‘clutches’ for automobiles falling under CETH 87089300.
Whether the Appellant is eligible to avail CENVAT credit on the clutches received from their Unit 1 when there is no process of manufacturing involving packing or re-packing of such goods in a unit container or labelling or re-labelling of containers including the declaration or alteration of retail sale price on it or adoption of any other treatment on the goods to render the product marketable to the consumer as contemplated in Section 2(f)(iii) of the Central Excise Act, 1944?
HELD THAT:- The admitted facts are that the Appellant is engaged in the activities of packing/ re-packing/ labelling/ re-labelling/ affixing of new MRP on the goods ‘Clutches’ procured from their vendors which amount to manufacture in terms of Section 2(f)(iii) of the Central Excise Act, 1994 which were cleared on payment of duty under Section 4A of the Central Excise Act, 1944. However, in respect of the goods procured from their Unit 1 from 01.04.2012 to 09.05.2012 which were not subjected to the above process as contemplated under Section 2(f)(iii) of the Central Excise Act, 1994 and as such, they could not considered as inputs and the credit taken on such items is not in accordance with the law and they are not eligible for the CENVAT credit availed to an extent of Rs.1,70,46,634/- was the stand of the Revenue for initiation of these proceedings against the Appellant.
It is found that for the earlier period in the Appellant’s own case, the Tribunal Chennai has passed an order in M/S. LUK INDIA PRIVATE LIMITED VERSUS THE COMMISSIONER OF GST & CENTRAL EXCISE, SALEM [2024 (2) TMI 1018 - CESTAT CHENNAI] allowing the Appellant’s appeal. The facts being identical, the decision is squarely applicable - It was held in the said case that 'When the department has collected duty on the finished products, the credit availed on the inputs cannot be denied alleging that the activity does not amount to manufacture.'
The impugned Order-in-Appeal No. 71/2017 dated 30.11.2017 of the Commissioner of GST and Central Excise, Coimbatore, Circuit Office @Salem, cannot be sustained and so ordered to be set aside - appeal allowed.
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2024 (11) TMI 123
Recovery of allegedly inadmissible credit alongwith interest and penalty - inputs or not - allegation against the appellant was that credit of duty paid, on inputs used exclusively in the ‘research and development (R&D)’ division of the appellant, had continued to remain on their books despite the non-dutiability of the products emanating from the said division - HELD THAT:- The Tribunal in their own dispute in FORCE MOTORS LIMITED VERSUS COMMISSIONER OF CENTRAL EXCISE PUNE – I [2018 (4) TMI 466 - CESTAT MUMBAI], relating to the immediately succeeding period, i.e., April 2013 to December 2013 has held that 'Considering the wide latitude offered for availment of credit, and in the absence of any allegation that research and development is not concerned with manufacture of the appellant, the disallowance of Cenvat credit does not find favour and must be set aside.'
The impugned order is set aside - appeal allowed.
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2024 (11) TMI 122
Admissibility of credit - input service - “Goods Transport Agency Service” [GTA] availed by the appellant for outward transportation of goods on Free on Road [FOR] destination basis from the factory gate or depot of the appellant to the premises of the customers - HELD THAT:- From the records of the case, it is found that there is no dispute that the appellant was selling their final products on FOR destination price as the said fact is acknowledged in the show cause notice as well as by the Adjudicating Authority. The place of removal in FOR destination sales is customer’s premises wherein the ownership/property in the goods stands transferred. The Appellant Company also bears the freight charges incurred for outward transportation. The price charged to customers for goods on which central excise duty is paid is inclusive of freight.
The Appellant engages transporters for outward transportation of goods and paying freight charges to the transporters. The Appellant also bore the risk of loss/damage during transit till the goods reaches the doorstep of the customers. In this regard, the appellant also taken transit insurance policy. The appellant also paying service tax under reverse charge mechanism on payment made to transporters and availing credit of the same.
The High Court in AMBUJA CEMENTS LTD. VERSUS UNION OF INDIA [2009 (2) TMI 50 - PUNJAB & HARYANA HIGH COURT] decided in favour of the appellant that the transportation of the goods upto the customer’s premises would also be covered within the definition of “input service”.
The impugned order is un-sustainable and needs to be set aside - Appeal allowed.
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2024 (11) TMI 121
Denial of benefit of the exemption notification for job work - whether the appellant is liable to pay central excise duty on the goods manufactured by them on job work basis under Notification No.214/86-CE dated 25.03.1986 for M/s. Neelgiri Electricals, who were availing the area based exemption under Notification No.49 & 50/2003-CE and were clearing the goods at ‘Nil’ rate of duty? - levy of interest and penalty as well - HELD THAT:- Having perused the decision in M/S. R.N. ALLOYS VERSUS COMMISSIONER OF CENTRAL GOODS & SERVICE TAX, UTTARAKHAND [2023 (11) TMI 364 - CESTAT NEW DELHI], it is found that identical facts were involved in the said case, where the principal manufacturer, who supplied the raw materials/inputs to the job worker, was availing the benefit of area based exemption under Notification No.50/2003-CE dated 10.06.2003 and, therefore, were not paying the central excise duty on their final products. Considering the provisions of the notification and the conditions specified therein, it was noticed that the principal manufacturer had not submitted the undertaking that the goods shall be removed on payment of duty for home consumption from his factory.
In the present case, M/s. Neelgiri Electricals, being the principal manufacturer was availing the benefit of the area based exemption notification and, was, therefore, clearing the goods at ‘Nil’ rate of duty and in that view, they have not furnished the undertaking as required under the notification that the supplier of the raw material or semi-finished goods gives an undertaking that the said goods shall be removed on payment of duty for home consumption from his factory. As a result, neither the appellant, who is the job worker has paid the duty nor the principal manufacturer, who was availing the area based exemption, paid the central excise duty, which is not the intention of the notification and the interpretation thereof placed by the various decisions. If the principal manufacturer has not discharged the tax liability, the burden would fall on the job worker and in that view, the appellant is liable to discharge the duty liability.
Penalty - HELD THAT:- The Authorities below have rightly imposed the penalty on the appellant as well as on the Director. It was within the knowledge of the appellant that M/s. Neelgiri Electricals was availing the exemption of central excise duty under the area based exemption notification as mentioned on the job work challan and also as admitted by Shri Raghu Nandan Chhimpa, Manager and Authorised Signatory of the appellant in his statement recorded under Section 14 of the Act on 17.05.2023.
Interest - HELD THAT:- As the appellant had failed to pay the central excise duty, they are liable to pay interest thereon under Section 11AA of the Act.
There are no merits in this appeal and, therefore, the impugned order is upheld. The appeal, accordingly stands dismissed.
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2024 (11) TMI 120
Rejection of refund claim made under Section 142 (3) of CGST Act, 2017 read with Section 11B of the Central Excise Act, 1994.
HELD THAT:- As regard the refund claim of Rs. 20,52,143/- and Rs. 2,19,004/- as submitted by learned counsel, the same has been allowed in the revised Trans-1. However, the same has not yet been credited in their electronic credit ledger. In this regard, the appellant has liberty to approach the concerned GST authority for further credit in the Electronic Credit Ledger. Therefore, as regard the refund claim for the amount of Rs. 20,52,143/- and Rs. 2,19,004/- the same became infructuous.
As regard the refund claim of Rs. 41,244/- and Rs. 4,87,533/-, the same was rejected on the ground that appellant have paid the amount after 01.07.2007, thereafter, no Cenvat credit provision was excisting. It is found that this issue has been considered by this Tribunal in the case of SHREE GANESH REMEDIES LIMITED VERSUS COMMISSIONER OF C.E. & S.T. -VADODARA-II [2024 (8) TMI 1468 - CESTAT AHMEDABAD] wherein dealing with the same issue this Tribunal has held that 'The Section 142(3) also deals with the amount which is accrued prior to GST regime. Accordingly, the situation arose in the present case is exactly the same for which provision of Section 142(3) was enacted. The amount of service tax was pertaining to the period prior to 01.07.2017 which is payable under the existing law. Subsequently, the said amount became admissible as a Cenvat credit under existing law and since the same cannot be availed as Cenvat credit after 01.07.2017, the only option is to refund the same in terms of Section 142(3).'
From the above decision, it is clear that even though the tax/duty paid subsequent to 01.07.2017 but for the period prior to 01.07.2017, the same is eligible as Cenvat credit under existing law. Therefore, only because the Service Tax was paid after 01.07.2017 refund cannot be rejected. However, the refund has to be processed by following the law such as unjust enrichment, etc. Therefore, only for this limited purpose, this matter related to refund of Rs. 41,244/- and Rs. 4,87,533/- is remanded to the adjudicating authority, for passing a fresh order.
Appeal disposed off.
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2024 (11) TMI 119
Recovery of amount availed as excess refund - violation of condition of N/N. 56/2002-CE dated 14.11.2002 - HELD THAT:- This issue is no more res integra as held in various decisions. This Tribunal in the case of M/s Pace Non Woven Fabric Products [2024 (8) TMI 201 - CESTAT CHANDIGARH] has considered the identical issue and has held 'since the department has not challenged the refund sanctioned order till date and in the absence of challenge to the refund sanction order, the refund cannot be rejected as held by the Hon'ble Gauhati High Court in the case of CCE, Shillong vs. Jellalpur Tea Estate [2011 (3) TMI 11 - GAUHATI HIGH COURT].
The impugned order is not sustainable in law and the same is set aside - appeal allowed.
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2024 (11) TMI 54
Exemption to new Industrial Undertakings / Units - Obtaining fresh license by the respondent after ban was lifted - Establishment of new industry or not - entitlement for benefit of Notification dated 25.04.2007 - old wood-based plywood industry, functioning at Jeypore prior to the ban imposed by the Apex Court.
Whether Hon’ble CESTAT has erred in law in holding that obtaining fresh license by the respondent after ban was lifted by the Hon’ble Supreme Court on the basis of the report of the High Power Committee amounts to establishment of new industry and entitled to benefit of Notification dated 25.04.2007? - HELD THAT:- From a bare perusal of the order of the CESTAT it is more than clear that the CESTAT has not held that the respondent has obtained a fresh licence after the ban had been lifted by the Hon’ble Supreme Court on the basis of the report of the High Power Committee and, therefore, is entitled to benefit of the Notification dated 25.04.2007. In such circumstances, the substantial question of Law as framed by this Court is factually incorrect.
Whether the findings of the LD Tribunal is perverse in holding the newly established industry, whereas admittedly ‘M/s Sarda Plywood Industries Ltd, Jeypore is an old wood-based plywood industry, functioning at Jeypore prior to the ban imposed by the Apex Court? - HELD THAT:- It cannot be held that the finding recorded by the CESTAT to the effect that the respondent has established a new industrial unit is perverse. The Assistant Commissioner and the Commissioner (Appeals) as well as the CESTAT have recorded their findings after taking into consideration the materials, which suggest that the respondent has established a new industrial unit, although on the same site. The Revenue has failed to produce any evidence contrary to the findings arrived at by the Assistant Commissioner and the Commissioner (Appeals) as well as the CESTAT, or in support of its stand that the respondent has not set up a new factory but has only renovated its old factory.
The materials available on record reveal that the Assistant Commissioner, after visiting the respondent factory and after inspecting the documents, recorded a specific finding that the respondent unit is a new industrial unit which commenced commercial production after 01.04.2007. Apparently, the said finding of fact is based on the material and has rightly not been interfered with by the Commissioner (Appeals) as well as by the CESTAT.
Thus, no substantial question of law arises in the present appeal. Hence, the appeal is dismissed.
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2024 (11) TMI 53
Eligibility for waiver of penalty imposed under Rule 26 of CER on co-noticees - in the case of the main party i.e. Komal Atomizer P Ltd the case has been settled under SVLDRS-2019 - contrary judgements on the issue - HELD THAT:- It is found that though there are contrary judgment on the issue that whether the co-noticee is eligible for waiver of penalty in case where the main party’s case has been settled under SVLDRS-2019. However, there are some judgments given by Single Member Bench and as regard the judgment on the same issue given by the Division Bench which are in favour of the assessee.
Hence, the division bench judgment in the case of M/s. Siemens Ltd [2023 (5) TMI 377 - CESTAT MUMBAI] will prevail over single member bench judgment, following the same the penalty is liable to be set aside. Hence, the same is set aside.
Appeal is allowed.
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2024 (11) TMI 52
Recovery of duty of central excise under section 11A of Central Excise Act, 1944, along with applicable interest and penalty - additional consideration for sale of manufactured goods - remission of the ‘net present value (NPV)’ of the accumulated amount as full and satisfactory compliance with the dues - inclusion of difference between the amount collected and the ‘net present value (NAV)’, computed with the date of schedule payments as benchmark, in the assessable value - HELD THAT:- The issue stood covered by the decision of the Tribunal in COMMISSIONER OF CENTRAL EXCISE, RAIGAD, BALKRISHNA INDUSTRIES LTD., ESSEL PROPACK LTD. VERSUS UTTAM GALVA STEELS LTD., BHUSHAN STEEL LTD., JSW ISPAT STEEL LTD., COMMISSIONER OF CENTRAL EXCISE, AURANGABAD [2015 (10) TMI 1727 - CESTAT MUMBAI] which, in identical circumstances of dispute of another similarly situated automotive parts manufacturer, RATIONAL ENGINEERS PVT LTD VERSUS COMMISSIONER OF CENTRAL EXCISE, THANE – I [2023 (11) TMI 363 - CESTAT MUMBAI] was considered. It is found that the issue did come up in the above referred dispute and it was held therein that 'Among the terms actually paid or actually payable used in transaction value, actually paid is not relevant in the present set of appeals. What is relevant is actually payable . Actually payable at the time of clearance is the deferral sales tax. Thus, in our view, the amount of deferral sales tax will require to be excluded.'
It was further held that 'the actual amount paid is equal to NPV (which is less than originally payable), cannot make the amount actually payable at the time and place of removal different, particularly when under Sales Tax Law such a payment is considered as deemed payment of the sales tax payable. Quantum of sales tax payable does not change in the above scheme of pre-payment.'
In view of the decisions of the Tribunal, deciding on the dispute arising from the peculiar features of the said scheme of the Government of Maharashtra, the impugned order set aside - appeal allowed.
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