2016 (10) TMI 341 - HC - Central Excise

CENVAT credit - manufacturer of vanaspati oil - The Authorities have refused to give the Cenvat credit on the plea that the regulations have subsequently been changed. - reference made to the decision of the Hon ble Court in Rasoi Ltd. Vs. Union of India 2004 (6) TMI 46 - HIGH COURT AT CALCUTTA - whether the petitioners be allowed to invoke the rights vested in them in terms of the earlier notification? - Held that - The petitioners herein are similarly situated and circumstanced as that of Rasoi Ltd., the decision in the case apply. The petitioners are entitled to invoke the rights vested in them in accordance with the notification issued earlier by the parties. Viewed from such perspective the impugned order as well as the show cause notices cannot stand in the manner and form as they stand today. The impugned order as well as the show cause notices set aside - CENVAT credit allowed - petition allowed - decided in favor of petitioner.

Summary

Issues:
Challenge to final order by Commissioner, Central Excise and show cause notices.
Entitlement to Cenvat credit for manufacturer of vanaspati oil.
Interpretation of earlier notification and vested rights.
Applicability of previous judgments in similar cases.

Analysis:
The petitioners challenged a final order by the Commissioner, Central Excise, Kolkata-IV, and show cause notices issued by the Authorities. The petitioners, represented by their learned Advocate, argued that they, as manufacturers of vanaspati oil, were entitled to the credit of Cenvat as per the rules in force at the time. The Authorities had denied them this credit citing subsequent regulatory changes. The Advocate referred to a previous decision by the Court in Rasoi Ltd. Vs. Union of India, where similar issues were addressed, and argued that the petitioners' case was akin to that of Rasoi Ltd. The Advocate also highlighted a recent judgment in a related case, W.P. No. 2144 of 2005, where the Court ruled in favor of the petitioners, further supporting their claim.

The respondent's Advocate countered by mentioning that a Special Leave Petition against the Rasoi Ltd. decision had been dismissed. However, the Court examined the arguments of both parties and the evidence on record. It noted that the petitioners sought to exercise their vested rights as per an earlier notification, a right that was acknowledged in the Rasoi Ltd. case. Given the similarity in circumstances between the petitioners' case and Rasoi Ltd., as well as the previous judgment in W.P. No. 2144 of 2005, the Court found no reason to deviate from the precedent set by Rasoi Ltd. The Court held that the petitioners were indeed entitled to invoke their vested rights as per the earlier notification, rendering the impugned order and show cause notices untenable in their current form.

In conclusion, the Court disposed of W.P. No. 1418 of 2005 accordingly, setting aside the impugned order and show cause notices. No costs were awarded in this matter. The judgment reaffirmed the principle that manufacturers of vanaspati oil could invoke their vested rights as per the relevant notification, following the precedent set by the Rasoi Ltd. case and the Court's previous ruling in a similar case.