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Central Excise - Case Laws
Showing 581 to 600 of 81329 Records
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2024 (7) TMI 184
Reversal of CENVAT Credit - credit availed on the inputs and capital goods such as explosives, detonators, lubricants, components, etc. provided to the contractors for mine development work/ore production in terms of Rule 3(5) of the Cenvat Credit Rules, 2004 - extended period of limitation - interest - penalty.
CENVAT Credit - HELD THAT:- The appellant is right in submitting that the issue in the present case is squarely covered by the earlier decision in their own case C.C.E. & S.T. UDAIPUR VERSUS M/S. HINDUSTAN ZINC LTD. [2017 (5) TMI 514 - CESTAT NEW DELHI], covering the subsequent period, where it was held that 'As such there is no removal of inputs or capital goods and there is no question of any reversal under rule 3(5) of the Cenvat Credit Rules 2004. Therefore, credit cannot be denied in this case'.
On merits, following the earlier decisions of the Tribunal in Hindustan Zinc, there is no sale and no removal of inputs and capital goods when the assessee supplied the same to the contractor, which was used for mine development activity and, therefore, the provisions of Rule 3(5) are not applicable. In the circumstances, the appellant was not required to reverse the credit availed in respect of the impugned items. Merely providing the inputs and capital goods to the contractor for use within the captive mines for mine development works of the appellant does not amount to removal and thereby, do not attract the provisions of Rule 3(5) of CCR.
Extended period of limitation - interest - penalty - HELD THAT:- Since the issue has been decided on merits in favour of the appellant, the question of extended period of limitation, levy of interest and penalty does not survive.
The impugned order deserves to be set aside - Appeal allowed.
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2024 (7) TMI 183
Sale of branded goods or not - gold bars and gold/silver coins - no logo, trademark or brand name affixed on the above said items - liability to pay duty in terms of N/N. 01/2011-CE. dated 01.03.2011 - HELD THAT:- On going through the entry 89, it is found that “articles” in relation to gold shall mean anything (other than ornaments), in a finished form, made of, or manufactured from or containing, gold and includes any gold coin and broken pieces of an article of gold but does not include primary gold, that is to say, gold in any unfinished or semi-finished form including ingots, bars, blocks slabs, billets, shots, pellets, rods, sheets, foils and wires.
Admittedly, the main demand in the present case against the appellant is for sale of gold bar, which is specifically excluded as per the Explanation given in the said Entry. Therefore, the gold bars, which is primary gold, sold by the appellant, are not excisable goods and consequently, no duty is payable by the appellant.
Gold coins and silver coins - HELD THAT:- There is no logo, trademark or brand name affixed/embossed on these articles - On going through the pictures it is found that there is no mark indicating brand name on the gold / silver coins and therefore, it cannot be considered that these are branded goods. In these circumstances, on these gold / silver coins, the appellant is not liable to pay duty in terms of Sl. No. 89 of Notification No. 01/2011-C.E. dated 01.03.2011.
The decision relied upon by the Ld. Authorized Representative for the Revenue in the case of Australian Foods India (P) Ltd. [2013 (1) TMI 330 - SUPREME COURT] is not applicable to the facts of this case as, in this case, there is a specific Circular issued by the respondent vide Circular F. No. 354/38/2011-TRU dated 02.03.2012 which clarified that 'It is clarified that the excise duty leviable on precious metal jewellery, manufactured or sold under a brand name, is attracted only on such jewellery on which the trade/brand name or any such mark or symbol or even a number which is cross referred with such trade/brand name ((not being a house mark used by jewellers for identification of jewellery at the time of exchange/resale) is indelibly marked or embossed. If such brand name is not affixed or embossed on the jewellery or article itself but appears on the packing such as the jewellery box or pouch or even on the warranty card or certificate of quality, such goods will not be treated as branded jewellery and thus will not be liable to excise duty.'
Thus, no duty is payable by the appellant. Consequently, no penalty can be imposed on the appellants.
The impugned order set aside - appeal allowed.
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2024 (7) TMI 182
Clandestine operation of Form, Fill & Seal (FFS) for packing machine in contravention of the provisions of the Chewing Tobacco and Manufactured Tobacco Packing Machines Rules, 2010 in an unregistered premise, without obtaining registration - failure to prove the date of installation of machine - demand of duty alongwith penalties on both the appellants.
Whether the date of installation of the machine is on the basis of evidence placed or it is to be presumed that the same has to be taken up from the 1st April, 2012 in the absence of any material evidence?
HELD THAT:- The fact of sale of machine by M/s Hindustan Machines has been verified. During investigation, it was found that M/s Hindustan Machines have sold the machine on 16.03.2012. The Revenue has alleged that this is a afterthought. It is found that the investigation was done on 29.03.2012 and the invoices has been produced on 02.04.2012, which is within 2 or 3 days, but no evidence has been produced by the Revenue that the said invoice is not genuine as on the said invoices, the supplier of the machine has paid the VAT.
In that circumstances, the premise goes benefit of doubt in favour of the appellant that they had been able to produce the invoices of the machine on 16.03.2012, which might have been installed within a week time and the claim of the appellant is that they have started production on 22.03.2012.
In this case, the appellant has been able to prove with a documentary evidence and the packing machine has been supplied on 16.03.2012 from Bhillai. As the appellant is located in Kalahandi, therefore, production of machine starts w.e.f. 22.03.2012.
The appellant is liable to duty in terms of Rule 18 (2) of the Chewing Tobacco and Unmanufactured Tobacco, Packing Machine (Capacity Determination and Calculation of Duty) Rules, 2010 w.e.f. 22.03.2012 along with interest and the appellant is liable to be penalized in their activity as they failed to intimate the Department in advance - The remaining demand is not sustainable against the appellant.
Appeal disposed off.
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2024 (7) TMI 181
Levy of penalty under Rule 209 and Rule 26 of the Central Excise Rules, 1944 and 2002 - Scope of SCN - impugned order assailed on the ground that the provisions of erstwhile Rule 209 ibid and Rule 26 ibid shall not be invoked inasmuch as no proposals were made in the showcause notice for confiscation of the goods, which were not available in the factory.
HELD THAT:- Rule 209A ibid and Rule 26 ibid were similarly worded, concerning imposition of personal penalty. Since, the period of dispute involved in these appeals is from February, 2000 to September, 2003, both the provisions are attracted herein for consideration of the issue as to whether, the Department’s action for imposition of penalty under Rule 209 and 26 ibid was proper or otherwise.
It transpires that question of imposition of personal penalty would arise only in the eventuality, when the person concerned on whom the penalty is sought to be imposed, was having the knowledge that the offending goods were liable for confiscation. On reading of the show-cause notice as well as the impugned order, it is found that the authorities below nowhere had mentioned that the appellants had a pre- knowledge that the goods which were not received in the factory were liable for confiscation. Since the show-cause notice in this case, had not proposed for confiscation of the goods and the said aspect has not been dealt with in the adjudication order, the imposition of penalty under Rule 26 ibid on the appellants cannot stand judicial scrutiny.
There are no merits in the impugned order, insofar as it has imposed penalty on the appellants under Rule 209/26 of the Rules, 1944/2002 - impugned order is set aside - appeal allowed.
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2024 (7) TMI 105
Input tax credit on furnance oil - to be allowed on proportionate basis or respondent-assessee should be directed to pay 8% on the total value of the exempted supply as per Rule 6(3) of Cenvat Credit Rules, 2004 - HELD THAT:- The Tribunal vide its order dated 18th July 2006 has set aside the Order-In- Original (O-I-O) which had directed respondent-assessee to make payment of 8% of the sale price of the exempted final products. It is against the said Tribunal’s order, appellant-revenue is in appeal before this Court.
Both the parties agree that the Tribunal, in 2006, did not have the benefit of the decision of the Apex Court in the case of THE COMMISSIONER OF CENTRAL EXCISE, VADODARA-II VERSUS GUJARAT NARMADA VALLEY FERTILIZERS CO. LTD. [2019 (12) TMI 430 - SUPREME COURT] and, therefore, they have no objection if the impugned order is set aside and remanded back to the Tribunal for considering the issue afresh, keeping open all the contentions of both the parties. In view thereof, the said submission is accepted by setting aside the impugned order of the Tribunal and remanding the same for denovo consideration by the Tribunal.
Since the matter pertains to issues that developed almost 18 years ago, the Tribunal is requested to dispose the appeal at the earliest and preferably by 30th October 2024 after giving opportunity of hearing to both parties.
Appeal disposed off.
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2024 (7) TMI 104
Pre-deposit or not - duty continued to be paid by the appellants, under protest, during the pendency of the appeal - applicability of provisions of Section 11B and the doctrine of unjust enrichment - Eligibility to claim interest on refund of the amount duty paid or deposited.
Pre-deposit or not - duty continued to be paid by the appellants, under protest, during the pendency of the appeal - HELD THAT:- The payment of total duty and penalty confirmed was the general rule while grant of stay of the same was an exception subject to the discretion of appellate authorities and the conditions that the appellants may put as deemed fit. After 06.08.2014, the filing of appeals was subject to payment of an amount equal to 7.5 percent or 10 percent, of the duty/ penalty demanded as the case may be. However, there is no provision to discriminate against an appellant who chooses to deposit duty in toto in comparison to the appellant who pays an amount equal to 7.5 percent or 10 percent as the case may be. It appears that before 06.08.2014,the payment of total duty demanded, during the pendency of the appeal, to exercise the right to appeal, would not take away the character of being a deposit from the sums deposited during the pendency of the appeal, under Section 35F or for that matter Section 35L as both fall under Chapter VIA.
CBEC vide Circular No 984/08/2014-CX, dated 16.09.2014, issued vide F. No.390/Budget/1/2012-JC clarified that any payment made during investigation shall be counted as part of pre-deposit during the filing of appeal in Central Excise & Service Tax matters.
The issue as to whether the amount of duty deposited during the pendency of appeal amounts to pre-deposit was deliberated by tribunal and Courts in several Cases. Hon‘ble Supreme Court in the context of the Maharashtra VAT Act, 2002, in the matter of VVF (India) Ltd Vs State of Maharashtra, [2021 (12) TMI 477 - SUPREME COURT], held that amount pre-deposited under protest prior to assessment order was required to be included in computing amount of mandatory pre-deposit.
Hon‘ble High Court of Gujarat held in the case of C.C. (Preventive)Vs Ghaziabad Ship Breakers Ltd [2010 (10) TMI 151 - GUJARAT HIGH COURT] that amount deposited during the pendency of an appeal before the Hon‘ble Supreme Court would squarely fall within the ambit the Section 129E of the Customs Act, 1962. Section 129E of the Customs Act, 1962 is parimateria with the Section 35F of Central Excise Act,1944. Hon‘ble High Court held that 'it is an undisputed position that the amount in question had been deposited by the respondent during the pendency of the appeal before the Supreme Court. In the circumstances, it is apparent that the amount so deposited would squarely fall within the ambit of Section 129-E of the Act and has to be treated as pre-deposit. Thus, the contention raised on behalf of the appellant that the amount has been paid by way of duty and not pre-deposit, being contrary to the provisions of section 129E of the Act, does not merit acceptance.'
Thus, it appears that the issue whether amounts paid during the pendency of appeal takes the colour of a pre-deposit under Section 35F of the Central Excise, Act 1944, or for that matter Section 35N, has been settled for the period before the amendment of Section 35F w.e.f. 06.08.2014. After 2014, the appellants are required to pay a certain percentage (7.5% or 10% as the case may be) of duty or penalty as the case may be and there is no such requirement to deposit entire duty for preferring an appeal. However, in the instant case, the appeals are filed before the amendment. CBEC circular No 984/08/2014-CX dated 16th September 2014 clarifies that the amended provisions apply to appeals filed after 6th August, 2014 - any amount deposited during the pendency of an appeal before the High Court or the Supreme Court would also be by way of deposit under Section 129E of the Act and has to be treated accordingly.
The amounts, deposited/paid by the appellants, during the pendency of the appeals, have to be considered as a mandatory pre-deposit made under Section 35F - The legislative intent that there can be two types of deposit, i.e. of full amount payable under main proviso to section 35F and partial payment as decided by Commissioner (Appeals) or CESTAT, is made clear by the introduction of Section 35F, w.e.f. 10.05.2008, so as to provide for the payment of interest in respect of deposits made in pursuance of deposits made only under First proviso to Section 35F. This difference was obliterated by the amendment w.e.f. 06.08.2014 prescribing a uniform pre-deposit, under Section 35F, as percent of duty or penalty confirmed, as a pre-condition for appeal and providing for payment of interest, under Section 35FF, for all deposits made under 35F.
Whether the provisions of Section 11B and the doctrine of unjust enrichment are applicable to such payments? - HELD THAT:- In the instant case, the amount was deposited by the appellants consequent upon the order passed by the Commissioner (Appeals); as both CESTAT and Hon‘ble Apex Court declined to grant stay of the amounts involved, the appellants continued to pay the amount under protest, on the clearances of clinker made by them for captive consumption. Till 2015, the matter was under litigation and therefore, the amount deposited, to exercise the right to appeal, has to be treated as deposits made under Section 35F and Section 35L - The question involved in the instant case is as to whether the refund of pre-deposit is subject to the rigors of unjust enrichment and as to whether the presumption that incidence of duty has been passed on is applicable and not the question of equity where the passing on of incidence is established.
The amounts deposited by the appellants, during the pendency of the appeal, are to be considered as a pre-deposit for the purposes of Section 35F and the return of which is not governed by the rigors of Section 11B - The certificate was issued after going through the accounts of the appellants and after satisfying himself about the truthfulness of the same. A certificate given by a professional cannot be dis-regarded unless it is proved to be blatantly wrong and contrary to the facts and evidence available on the hand. Thus, the certificate given by the Cost/Chartered Accountant has an evidentiary value and cannot be rejected in a half-handed manner. The impugned order having been issued without giving reasons as to why the same has not been taken into account cannot be held to be legally sustainable.
The presumption under Section 11B being a rebuttable one, such rebuttal put forward by the appellant is required to be considered in the facts and circumstances of the case and the nature of the product - the amount paid by the appellants is a pre-deposit under Section 35F and as such the same is to be returned without subjecting the same to the provisions of Section 11B.
Payment of interest on the delayed payment of refund of pre-deposit - HELD THAT:- A perusal of the provisions of Section 35FF gives a clear understanding that w.e.f. 10.05.2008; a provision has been made to grant interest on the refund of amounts deposited under the proviso to Section 35F. The wordings used in the new Section 35FF, makes it unambiguously clear that a provision to pay interest is made in respect of amounts deposited in terms of the orders passed by the Commissioner (Appeals) or the Appellate Tribunal (hereinafter referred to as the appellate authority), under the first proviso to section 35F.The Section as it stood before 06.08.2014 did not provide for payment of any interest on the deposits made under the main Section 35F. However, it is provided w.e.f. 06.08.2014 that interest shall be sanctioned on the delayed refund of the deposit made under Section 35F - w.e.f. 06.08.2014, the amended Section 35FF provides for payment of interest on the delayed refund of amount deposited under Section 35F irrespective of the fact whether such payment was under main Section or first proviso of Section 35F. Therefore, the appellants are eligible for interest on the delayed refund of amounts deposited by them after 06.08.2014.
Appeal allowed in part.
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2024 (7) TMI 103
Classification of Goods - mixture of Melamine Formaldehyde Resin and Cardanol Phenolic Formaldehyde used as Adhesive/Glue/Resin for the manufacture of final product - classifiable under Chapter 35-06 as claimed by the appellant or under Chapter 39-09 as alleged by the Department? - time limitation.
Classification of Goods - HELD THAT:- This issue is no more res integra and has been settled by various decisions of the Tribunal wherein the Tribunal has consistently held that the mixture of items used as adhesive/glue/resins for the manufacture of laminates is held to be classifiable under Chapter heading 35-06.
This issue has been examined and considered in various decisions relied upon by the appellant, reliance can be placed in VIRGO INDUSTRIES, WOOD STOCK LAMINATES PVT LTD, PUNJAB LAMINATES PVT LTD VERSUS COMMISSIONER OF C.E., CHANDIGARH-I [2019 (12) TMI 714 - CESTAT CHANDIGARH] wherein the identical issue was involved and the Tribunal has held that the mixture of aforesaid items used as Glue/Resin/Adhesive in the manufacture of laminates are classifiable under chapter heading 35-06.
It is found that no market inquiry was conducted with reference to the goods in question in order to establish as to whether the mixture is capable of being bought and sold. Further, the Revenue has not been able to establish in the case that the appellant has been either purchasing or selling the main items in the market. The Marketability of the product is an essential ingredients and criteria to hold that a product is dutiable/excisable and thus onus is on the Revenue to prove that the product is marketable or captatively being consumed.
Time Limitation - HELD THAT:- Thus, substantial demand upto December, 2010 is beyond limitation specially the fact of used of Melamine & Formaldehyde was already in the knowledge or Department on 24.11.2006 the show cause notice was issued after the expiry of normal period of limitation when all the facts were in the knowledge of Department in 2006, the declaration was filed on 24.011.2006 containing the details of finished goods as well as raw materials including Melamine & Formaldehyde & Phenol etc., as well as verification of units in the year 2006 itself - the substantial part of the demand upto December, 2010 is barred by limitation.
The impugned order is not sustainable in law - Appeal allowed.
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2024 (7) TMI 62
Classification of goods - printed paper labels - to be classified under Heading 48.21 attracting 16% ad valorem or under sub-heading 4901.90 attracting NIL rate of duty? - period 08.03.2002 to 31.03.2002 - HELD THAT:- The primary use of the goods is known to be as ‘printed labels’ and the product would then be correctly classifiable as a ‘product of printing industry’ falling under 4901.90 as argued by the appellant.
The Tribunal in the case of M/S. LOVELY OFFSET PRINTERS VERSUS COMMISSIONER OF CENTRAL EXCISE, TIRUNELVELI [2017 (1) TMI 1314 - CESTAT CHENNAI] had occasion to consider the very same issue of classification of printed paper labels. The Tribunal followed the decision in the case of JOHNSON & JOHNSON LTD. VERSUS COLLECTOR OF CENTRAL EXCISE, BOMBAY-II [1997 (7) TMI 138 - SUPREME COURT] and held that the goods would fall under chapter sub heading 4901.90.
The Hon’ble Apex Court in the case of JOHNSON & JOHNSON LTD. VERSUS COLLECTOR OF CENTRAL EXCISE, BOMBAY-II [1997 (7) TMI 138 - SUPREME COURT] had considered whether paper printed labels would be eligible for exemption as a product of printing industry and held the issue in favour of the assessee.
The Ld. A.R produced the decision in the case of ITC. LIMITED VERSUS COLLECTOR OF CENTRAL EXCISE, MADRAS [1997 (12) TMI 115 - SC ORDER]. In the said case, the issue that was under consideration was with regard to the paper / paperboard articles used for packaging of cigarettes which also contained printed matter. After considering both the competing classifications under Chapter Heading 48 as well as 4901.90, it was held that since the primary use of the articles being in connection with the packaging of cigarettes and the printing there being merely incidental to the primary use, the goods are correctly classifiable under Chapter 48 of the Tariff Act, 1985 - This decision would clearly bring out the distinction between the printing which is merely incidental as well as that of primary use and therefore would substantiate our view that the printing being of primary use in printed label, the impugned products in the present case are classifiable under Chapter heading 4901.90 of CET Act, 1985.
Thus, the impugned products fall under Chapter Heading 4901.90 as ‘products of printing industry’ and attract NIL rate of duty. The demand of duty therefore cannot sustain.
The impugned order is set aside - appeal allowed.
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2024 (7) TMI 61
Recovery of amount representing as duty of excise from the buyer or not - applicability of Section 11D of the Central Excise Act - SCN issued after five years from the date of the clearance of the cylinders - Time Limitation.
HELD THAT:- Section 11D is not applicable in the present case as no amount representing as duty of excise has been recovered from the buyer. Further, it is found that on the invoices issued after 24.01.2004 after date of availing of area based exemption, the appellant has subsequently mentioned on the invoices “Exemption Notification No. 50/03-CE dated 10.06.2003 and against the column of “B.E.D @ 16% the word “exempted” specifically mentioned which clearly shows no amount has been charged from the customers representing as duty of excise.
This issue has been considered by the Division Bench of this Tribunal in the case of PITAMBAR COATED PAPER LTD. VERSUS COMMISSIONER OF CENTRAL EXCISE, JAIPUR-I [2002 (8) TMI 686 - CEGAT, NEW DELHI] where it was held that 'there is not an iota of evidence on record that in the instant case, the appellants had Collected the amount from the buyers as representing excise duty. As observed above, in their invoices against column BED, they had put a X which indicated that they had not accepted any amount representing as excise duty from the buyers. Whenever, they had collected earlier to the availment of the exemption from payment of duty under the notification in question, they had separately shown the rate of duty recovered from the buyers of the goods, against the column BED. This fact is quite evident, as discussed above, from the copies of the invoices placed on the record by the appellants. Therefore, the provisions of Section 11D of the Act could not be Invoked against the appellants.'
Time Limitation - HELD THAT:- It is found that no statutory period is prescribed for recovery in Section 11D but Punjab and Haryana High Court in the case of CCE, Chandigarh Vs. Hari Concost Pvt. Ltd [2009 (4) TMI 170 - PUNJAB AND HARYANA HIGH COURT] after relying upon the judgment of the Hon’ble Apex Court in the case of CCE Vs. Bharat Sanchar Nigam Ltd. [2017 (11) TMI 348 - CESTAT KOLKATA] reasonable period for effecting the recovery but in the present case the recovery is sought to be affected after the expiry of more than five years.
The impugned order is not sustainable in law and therefore set aside - appeal allowed.
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2024 (7) TMI 60
Liability to pay 5%/6% of the value of the exempted goods cleared during the period from June 2008 to March 2013 - availing common CENVAT Credit in respect of dutiable goods as well as exempted goods - non-maintenance of separate records - Rule 6(3)(ii) of the CENVAT Credit Rules, 2004 - HELD THAT:- Rule 6(3A) provides that the manufacturer / provider of output service has to exercise the option by intimating in writing to the Superintendent of Central Excise giving necessary particulars. The allegation in the Show Cause Notice is that the appellant has not complied with this requirement of intimating the Department.
The Tribunal in the case of Mercedes Benz India Pvt. Ltd. [2015 (8) TMI 24 - CESTAT MUMBAI] had occasion to consider the very same issue and held that the requirement to inform the Department with regard to the option exercised is only procedural in nature - In the present case, it is not disputed that on being pointed out, the appellant has reversed the proportionate credit along with interest. The requirement under Rule 6(3)(ii) stands satisfied. In such circumstances, the Department ought not to have raised the Show Cause Notice demanding 5%/6% of the value of exempted goods.
The demand cannot sustain - the impugned order is set aside - appeal allowed.
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2024 (7) TMI 59
CENVAT credit of service tax availed on the strength of Input Service Distributor bill issued by the Head Office of the appellant, denied - duty paying documents - allegation is that the said bill did not contain the requisite particulars as required under Rule 4A of the Service Tax Rules, 1994 - HELD THAT:- As per Rule 9(2) of Cenvat Credit Rules, 2004, Cenvat credit shall be taken by the manufacturer or the provider of output service or input service distributor as the case may be on the basis of any of the documents. In appellant’s case they have produced challan evidencing payment of service tax by their Head Office and thereby complied with provision of Cenvat Credit Rules, 2004. In addition to that they have produced an invoice issued by their Head Office i.e. provider of input service. Thus, they have complied with the provisions of 6(f) also. The particulars regarding the registration, the registration relied by the adjudication authority is only on the request made by the Head Office of the appellant for change of name and as per the evidence available on record, they have registered with the Service Tax Authorities w.e.f. 21.03.2005. Thus both the findings given by adjudication/appellate authority are factually wrong and unsustainable.
The appellant is eligible for the Cenvat credit availed by them based on the challan issued by the Head Office - the impugned order is set aside - appeal allowed.
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2024 (7) TMI 58
100% EOU under the EHTP scheme - utilization of CENVAT Credit availed in the respect of input services for payment of NCCD leviable on clearance of the Mobile Phones in DTA - Recovery of NCCD under the proviso to Section 11A of Central Excise Act 1944 with interest and penalty - HELD THAT:- From the decision in BAJAJ AUTO LIMITED VERSUS UNION OF INDIA & OTHERS [2019 (3) TMI 1427 - SUPREME COURT], it is quite evident that NCCD levied under Section 136 of the Finance Act, 2001 is essentially an 'duty of excise’ and all the provisions relating to the manner of collection as well as obligation of taxpayer to discharge the duty as applicable to payment of Central Excise duty shall apply. There is no restriction on payment of basic excise duty from the Cenvat Credit taken in respect of input services received by the appellant. Thus the view that credit of service tax could not have been utilized for payment of NCCD cannot be upheld.
There are no merits in the impugned order and the same is set aside - appeal allowed.
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2024 (7) TMI 7
Interest on refund claim u/s 11BB of Central Excise Act, 1944 - relevant time - interest on refund has to be calculated from expiry of three months after passing of the Tribunal’s final order or it has to be calculated from the date of final order of the Tribunal - rate of interest - rate of interest should be 6% or 15% or any other rate - entitlement for interest on interest.
Whether the appellant is entitled to get interest under Section 11BB of Central Excise Act, 1944? - HELD THAT:- Hon’ble Supreme Court also in the case of COMMISSIONER OF CUSTOMS (IMPORT) , RAIGAD VERSUS M/S. FINACORD CHEMICALS (P) LTD & OTHERS [2015 (5) TMI 371 - SUPREME COURT] while discussing the liability of the department to pay the interest has referred to Departments' own circular dated 02.01.2002 wherein the Board clarified that the matters of refund other than the amount of duty would not be covered under the provisions of Section 11B of Customs Act or Section 35FF of Central Excise Act. It was held by the Hon'ble Apex Court that in such cases of refund even the concept of unjust enrichment is not applicable.
Once it is clear that Section 11B and 11BB of Central Excise Act will not be applicable to the amount in question, the denial of the interest on the appellant’s amount is held to be unjustified. As per the Article 300A of Constitution of India also, no person shall be deprived of his property, save by authority of law. He cannot be deprived of the same and is entitled for benefits arising out of said property. Hence interest accrued on the amount in question during the period it remained deposited with the department is the property of the owner of the amount i.e. the appellant herein - the appellants are entitled to claim the interest on the amount as has been refunded in their favour that too to be paid from the date of payment of initial amount till the date of its refund.
Rate at which the such interest has to be awarded - HELD THAT:- The amount in question was an amount in the form of pre-deposit. Hence, it is the refund in terms of Section 35FF. However, the interest on sanctioned amount of refund has been denied on the ground that refund has been sanctioned within three months from the date of communication of the order of appellate authority in terms of the pre amended Section 35FF of Central Excise Act, 1944.
The findings of the order under challenge are hereby set aside. The appellant is held entitled to have interest on the amount of refund sanctioned at the rate of 12% per annum since the amount was got deposited after denying the substantial benefit of MODVAT - the appellant is eligible for interest at the rate of 12% from the date of the deposit of the amount till the date of refund thereof - appeal allowed.
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2024 (7) TMI 6
Classification of goods supplied to railways - PVC Flooring Covering under Tariff Head No 39181090 or under Tariff Head No. 86079910? - exemption under N/N. 12/2016-CE dated 01-03-2016 - benefit of exemption under the N/N 12/2016-CE dated 01-03-2016 - HELD THAT:- Issue whether the goods will be classified under the specific tariff entry of the goods cleared or under chapter 86 has been settled by the Hon’ble Supreme Court in the case of WESTINGHOUSE SAXBY FARMER LTD. VERSUS COMMR. OF CENTRAL EXCISE CALCUTTA [2021 (3) TMI 291 - SUPREME COURT] - Hon’ble Supreme Court has held that end use of the goods should be a determinative factor for deciding the classification of goods. In case of the goods supplied to railway for being used in the rolling stock, the goods get classified as part of the rolling stock under chapter 86. That being so the classification claimed by the appellant at the instance of Railways under 86079910 cannot be faulted with. Accordingly the duty paid by the appellant claiming exemption under N/N. 12/2016-CE dated 01.03.2016 needs to be upheld.
There are no merits in the impugned order to this extent - appeal allowed.
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2024 (7) TMI 5
CENVAT Credit - inputs lying in stock as on 30.06.2017 and which have been used in manufacture of finished goods which have been cleared on payment of GST post 30.06.2017 - capital goods in terms of Rule 6(4) of CCR, 2004, used in manufacture of exempted goods after a period of two years from the date of commencement of commercial production - benefit of exemption N/N. 30/2004-CE.
CENVAT Credit on inputs - Rule 6 (1) of Cenvat Credit Rules, 2004 - HELD THAT:- As per the facts, the respondent has claimed the cenvat credit on the inputs lying in stock as on 30.06.2017 which shows that the inputs on which the cenvat credit was claimed have not been used in manufacture of goods cleared under Notification No. 30/2004-CE, therefore, such credit cannot be denied.
As per the condition of the N/N. 30/2004-CE, it is clear that the said condition is applicable only in respect of those inputs which were used in the manufacture of excisable goods which is cleared under N/N. 30/2004-CE - In the present case the inputs lying in stock as on 30.06.2017 were not used in the manufacture of excisable goods which were cleared under N/N. 30/2004-CE. For the obvious reason that those inputs were used in the manufacture of goods on which GST was applicable. Therefore, the entire basis of the Revenue that only due to availing the exemption N/N. 30/2004-CE, the cenvat credit is not admissible, is devoid of merit and without any legal basis. Therefore, the cenvat credit on inputs was rightly allowed by the Learned Commissioner.
CENVAT Credit on capital goods - Rule 6 (4) of Cenvat Credit Rules, 2004 - HELD THAT:- Though the appellant is eligible for cenvat credit but availment of credit is deferred for 2 years from the date of commencement of production or installation of capital goods. Though the cenvat credit was accrued to the Respondent but the respondent in a case is entitled to avail the same after 2 years due to the reason that the respondent have been availing exemption N/N. 30/2004-CE - this restriction was only because the respondent have been availing the exemption notification however the exemption notification was rescinded on 30.06.2017 and immediately thereupon the respondent became entitled for the cenvat credit on capital goods. Therefore, the said cenvat credit is admissible to the respondent. Moreover, thereafter the capital goods has been used for the manufacture of goods which is not exempted and liable for payment of GST.
The respondent is entitled for the cenvat credit on inputs as well as on capital goods - the impugned ordeer is sustained - appeal of Revenue dismissed.
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2024 (6) TMI 1417
Principles of unjust enrichment - time limitation - Refund of Education Cess (EC) and Secondary and Higher Education Cess (SHEC) paid on Oil Industry Development Cess (OIDC) - appellant has not submitted its financial records such as balance sheet, trial balance etc. to prove that they have borne the burden of EC and SHEC on OID Cess - difference of opinion - matter referred to the Third Member - majority order.
Whether a claim for refund of Central Excise Duty paid under a ‘mistake of law’ by the appellant will have to be filed under section 11B of the Central Excise Act, 1944 and are subject to the provisions including the time limit stated there under as per the law declared by the Hon’ble Supreme Court in its judgment of Mafatlal Industries Ltd. Vs. UOL [1996 (12) TMI 50 - SUPREME COURT] and the Larger Bench decision of this Tribunal in Veer Overseas Ltd. Vs. CCE, Panchkula [2018 (4) TMI 910 - CESTAT CHANDIGARH], whereby the refund claim filed by the appellant is time barred.
HELD THAT:- Aanalysis of the relevant provisions of the OIDC Act, 1974, it is clear that the cess has been collected as duties of excise and the provisions of Central Excises and Salt Act, 1944 and the rules made thereunder; particularly the provisions relating to refunds and exemptions from duties have been made applicable. Also, the EC and SHEC levied under the relevant provisions specifically refers to provisions of the Central Excise Act, 1944 relating to refunds, exemptions and imposition of penalty etc. for its administration.
The appellant had discharged EC and SHEC on Oil cess, considering it as duties of excise. Subsequently, applying the circular dated 07.01.2014 issued by the Board, wherein it is clarified that EC and SHEC be payable only on the cess which is administered and collected by Ministry of Financs it is realized by the Appellant that OIDC being administered by the Ministry of Petroleum and only collected by the Ministry of Finance; EC and SHEC are accordingly not payable. Thus, admittedly all these years, the EC and SHEC has been assessed and paid on the OIDC, considering the same as an excise duty under the relevant provisions of the CEA, 1944. The viries or its leviability on the said excise duty(Oil cess) has not been challenged by the Appellant nor the same has been declared as ultra vires levy by any High Court or Supreme court.
It is noted that to ascertain the correctness of certain decisions of the Apex Court, concept of unjust enrichment, interpretation of Article 265 of the Constitution of India and the provisions of the Central Excises and Salt Act, 1944 and the Customs Act and the reference by a Division Bench doubting the judgment of the correctness of the 5 Judges Bench in the case of Sales Tax Officer, Benaras & ors. Vs. Kanhaiyalal Mukundlal Saraf [1958 (9) TMI 57 - SUPREME COURT (LB)], the matters have been placed before the nine Judges Bench.
The EC and SHEC paid by the appellant which by way of misinterpretation of its applicability to Oil cess being administered by Ministry of Petroleum and not by Ministry of Finance(Department of Revenue) be considered as a payment of duty collected initially with authorities of law by a mis-interpretation of relevant provisions of Oil Industry (Development)Act, 1974 read with provisions of Central Excises Act, but later discovered to be not a levy authorised by law. Therefore, there are no hesitation to say that the principle laid down by the Hon’ble Supreme Court at clause (I) of the para 99 is squarely applicable to the facts of the present case.
Applicability of the judgment of the Hon’ble Gujarat High Court in the case of Joshi Technologies International INC-India Projects Vs. UOI [2016 (6) TMI 773 - GUJARAT HIGH COURT] which has been later followed by the jurisdictional High Court of Madras in the case of 3E Infotech Vs. CESTAT, CCE(Appeals-I) [2018 (7) TMI 276 - MADRAS HIGH COURT] - HELD THAT:- While laying down the principle of refund of illegal levy, Hon’ble Supreme Court categorically held that the necessity of pursuing statutory remedy in filing refund claim under the relevant enactment, will not be applicable when a petition has been filed under Article 226 before the Hon'ble High Court or Article 32 before the Hon'ble Supreme Court. In other words, the High Courts or the Hon'ble Supreme Court can consider refund of an illegal levy beyond the provisions of Section 11B of Central Excise Act, in exercise of its extraordinary jurisdiction conferred under Art. 226 or Art.32 of the Constitution, as the case may be.
(i) the refund claim of EC and SHEC paid on OID cess, being an ‘illegal levy’ is governed by the principle laid down in para 99(i) of the judgment of the Hon'ble Apex Court in Mafatlal Industries Ltd.’s case and the Larger Bench judgment in Veer Overseas Ltd.’s case; accordingly the claim have to be filed under Section 11B of the Central Excise Act, 1944 and governed by the said provisions prescribed thereunder. (i) On the second question, the judgment delivered by Hon'ble High Courts in Joshi Technologies case in exercise of Jurisdiction under Article 226 followed in 3E Infotec’s case cannot be applied by the departmental authorities and Tribunal in case of refund of ‘illegal levy” in view of the principle of law laid down by the Larger Bench of Tribunal in Veer Overseas Ltd.’s case.
Majority order - The Third Member has agreed with the view of Member (Technical) that the refund claim is time barred. In view thereof, the impugned order is upheld. The appeal is dismissed.
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2024 (6) TMI 1398
Liability of appellant to pay Central Excise Duty - appellant is the principal manufacturer and who has sent their raw materials to their job workers for conversion in terms of N/N. 214/86 -CE dated 25.03.1986 - HELD THAT:- The said issue stands decided by the Tribunal in the appellant’s own case in M/S. GREAVES COTTON LTD. VERSUS COMMISSIONER OF GST & CENTRAL EXCISE CHENNAI [2024 (5) TMI 1470 - CESTAT CHENNAI] has held that 'the appellant is not the manufacturer of the waste and scrap and therefore, there is no liability on the appellant to pay the duty on the waste and scrap manufactured at the job worker’s end. Further, the provision of Rule 4(5)(a) of the CENVAT Credit Rules, 2004 nowhere states that the waste and scrap generated at the job worker’s end makes the principal manufacturer liable to payment of duty on such waste and scrap.'
The demand do not sustain - impugned order set aside - appeal allowed.
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2024 (6) TMI 1394
Levy of personal penalty u/r 26 of the Central Excise Rules, 2002 - appeal settled under the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 - HELD THAT:- This Tribunal in the case of M/S JPFL FILMS PRIVATE LIMITED, JALAN JEE POLYTEX LTD., KAVITA INTERNATIONAL AGENCY, KULDEEP SINGH, DP SINGH, R KNITFAB, PERFECT DESIGNER, VK KALRA, RELIANCE INDUSTRIES LIMITED, KANPUR WOOL INDUSTRIES, SWASTIK TRADING CO., APEX CORPORATION AND MANSA TRADERS VERSUS COMMISSIONER OF CENTRAL EXCISE, LUDHIANA [023 (12) TMI 304 - CESTAT CHANDIGARH] held that once the main appeal is settled under SVLDRS, 2019, the appeals filed by the co-noticees challenging the personal penalty arising out of the same Orderin-Original cannot be sustained.
Consequently, the appeals filed by the appellants deserve to be allowed and the same are allowed.
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2024 (6) TMI 1324
Violation of principles of natural justice - it is submitted by petitioner that without giving an opportunity to reply to the Show Cause Notice after providing the documents the impugned order has been passed - respondents agreed that the impounded documents were given to petitioner only on 6th December 2023 - HELD THAT:- The controversy whether the documents referred to in Paragraph No. 17 of the Show Cause Notice dated 25th September 2023 was given to petitioner along with Show Cause Notice, is not gone into - But the fact is, without copies of the impounded documents even if those documents referred to in the Show Cause Notice were given along with Show Cause Notice, petitioner may not be even able to effectively respond to the Show Cause Notice.
The impugned orders are hereby quashed and set aside - matter is remanded to Respondent No. 1 for denovo consideration - petition disposed off by way of remand.
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2024 (6) TMI 1323
Clearance of goods for export without payment of duty in contravention of the conditions laid down in N/N. 42/2001-CE(NT) dated 26.6.2001 - failure to furnish / renew LUT - non-submission of the LUT - HELD THAT:- The SCN has not questioned the actual export of the goods but only the non-submission of the LUT for the relevant period. Post the export, certain documents are stated to have not been furnished by the appellant for verification as per the Order in Original. It is found that the charge of non-submission of documents was not an allegation mentioned in the SCN and the Ld. Original Authority and the Ld. Commissioner Appeals cannot travel beyond the allegations made out in the SCN and improve their case.
Once the fact of the Export of the goods was not questioned, the confirming of demand along with interest and imposing an equal penalty under sec. 11AC of the Central Excise Act, 1944, for a procedural lapse was too harsh and not warranted.
The ends of justice will be served by setting aside the fine and penalties imposed by the impugned order - the impugned order is set aside - Appeal allowed.
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