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2023 (11) TMI 151 - AT - Central ExciseSuo motu re-credit taken by the respondent - outward transportation - HELD THAT - As regard the suo motu re-credit, the entire proceeding was to disallow the cenvat credit on outward transportation and during the proceeding the respondent had reversed the credit when the Tribunal has allowed the credit on merit in respect of outward transportation vide Tribunal in Welspun Gujarat Stahl Rohren Ltd. 2012 (4) TMI 386 - CESTAT, AHMEDABAD . The respondent was legally entitled for re-credit as consequential relief flowing from the said Tribunal s order. Therefore there are nothing wrong in taking the suo moto re-credit which is clearly in compliance to the Tribunal s order. This issue has been considered by this Tribunal in case of COMMISSIONER OF CENTRAL EXCISE SURAT VERSUS M/S. VARDHMAN ACRYLICS LIMITED 2013 (5) TMI 6 - CESTAT AHMEDABAD wherein the Tribunal has held that suo motu admissible Cenvat credit taken, after getting a favourable decision from the first appellate authority, is correct. Thus, there are nothing wrong in respondent s taking suo moto re-credit of cenvat credit which was reversed - there is no infirmity in the impugned order - appeal of revenue dismissed.
Issues Involved:
1. Entitlement of the respondent to take suo motu re-credit of Cenvat credit. 2. Validity of the Revenue's appeal before the Supreme Court against the Tribunal's order. Summary: Entitlement to Suo Motu Re-Credit: The respondent availed Cenvat credit on outward transportation, which was initially disputed by the department via show cause notices dated 27.11.2007 and 15.06.2007. The adjudication orders dated 21.02.2006 and 30.09.2008 denied the Cenvat credit. The respondent appealed to the Tribunal, which allowed the credit on 19.03.2012. The Revenue's subsequent appeal to the Supreme Court was dismissed on 17.01.2018, finalizing the respondent's eligibility for the Cenvat credit on outward transportation. In a related proceeding, the respondent took suo motu re-credit of Rs. 59,35,233/- after the Tribunal's favorable decision. The department issued a show cause notice on 10.04.2013 to disallow this re-credit. The Commissioner (Appeals) dropped the proceedings in the impugned order dated 15.10.2013. The Revenue appealed, arguing that the respondent was not entitled to take suo motu re-credit and that the matter was pending before the Supreme Court. Validity of Revenue's Appeal: The Tribunal noted that since the Supreme Court dismissed the Revenue's appeal, the challenge to the Tribunal's order allowing Cenvat credit on outward transportation was unsustainable. Regarding the suo motu re-credit, the Tribunal found that the respondent was legally entitled to re-credit as a consequential relief from the Tribunal's order. The Tribunal cited several judgments supporting the respondent's position, including C.C.E, Surat-II vs. Vardhman Acrylics Ltd, Shyam Textiles Mills vs. UOI, and Ratnamani Metals & Tubes Ltd vs. CCE & ST. The Tribunal concluded that there was no legal error in the respondent's action of taking suo motu re-credit, as it complied with the Tribunal's order. The Revenue's appeal was dismissed, affirming the legality of the respondent's re-credit action. Conclusion: The Tribunal upheld the respondent's right to take suo motu re-credit of Cenvat credit following a favorable appellate decision and dismissed the Revenue's appeal, confirming the correctness of the re-credit action. The Tribunal's decision aligns with established legal precedents and judgments from higher courts.
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