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2024 (9) TMI 61 - AT - Central ExciseUtilization of Cenvat credit of basic excise duty for payment of National Calamity Contingent Duty (NCCD) - HELD THAT - The issue is no longer res- integra and the same is settled in various judgments as cited by the learned counsel. In the case of C.C.E. S.T. -SILVASA AND C.C.E. S.T. -DAMAN VERSUS WELSPUN SYNTEX LTD AND M/S. WELLKNOWN POLYESTER LIMITED 2019 (11) TMI 1268 - CESTAT AHMEDABAD , this tribunal held that ' while Cenvat Credit of NCCD can be utilized under the Cenvat Credit Rules only towards payment of such NCC Duty, Cenvat Credit obtained from other sources can be utilized for payment of NCC Duty on the final product.' - From the above decisions of this tribunal it can be seen that the utilization of basic excise duty for the payment of NCCD has been allowed considering the provisions of Rule 3 of Cenvat Credit Rules, 2004. As regard the heavy reliance placed by the revenue in the case of M/s. Unicorn Industries vs. UOI 2012 (5) TMI 621 - SIKKIM HIGH COURT , in that case the issue was different that whether the NCCD is an excise duty or surcharge. Even though as per the said judgment the NCCD is not an excise duty but a surcharge, rule 3 permits the utilization of basic excise duty for payment of NCCD. Therefore, judgment in the case of M/s. Unicorn Industries vs. UOI is not relevant on the issue and facts of the present case. The respondent is correct in utilizing the credit of basic excise duty for payment of NCCD. Therefore, the impugned orders are legal and correct and the same deserve to be sustained. The impugned order is upheld - appeal of Revenue dismissed.
Issues Involved:
- Whether the respondent can utilize the Cenvat credit of basic excise duty for payment of National Calamity Contingent Duty (NCCD). Detailed Analysis: Issue: Utilization of Cenvat Credit of Basic Excise Duty for Payment of NCCD Arguments by Revenue: - The Revenue argued that basic excise duty cannot be utilized for payment of NCCD. - They relied on the judgment of the Hon'ble High Court of Sikkim in the case of M/s. Unicorn Industries vs. Union of India, where it was held that NCCD is not an excise duty but a surcharge. - Based on this, the Revenue contended that the order passed by the Commissioner (Appeals) was not legal and correct, and therefore needed to be set aside. Arguments by Respondent: - The Respondent argued that the issue has been settled in various judgments which allow the utilization of basic excise duty for payment of NCCD as per Rule 3 of the Cenvat Credit Rules, 2004. - They cited several judgments including those from CESTAT Ahmedabad and the Hon'ble Gauhati High Court which supported their stance. Tribunal's Findings: - The Tribunal noted that the issue is no longer res-integra and has been settled in various judgments. - In the case of CCE & ST, Silvassa and CCE & ST, Daman vs. Welspun Syntex Ltd. and M/s Wellknown Polyester Ltd, it was held that the appellant can utilize the Cenvat Credit of basic excise duty for payment of NCCD. - The Tribunal found that the Revenue's reliance on the judgment of the Sikkim High Court in the case of Unicorn Industries vs. Union of India was misplaced because that case dealt with the issue of exemption from payment of NCCD, not the utilization of Cenvat Credit for payment of NCCD. - The Tribunal also referred to the judgment of the Hon'ble Gauhati High Court in the case of Union of India vs. Kamakhya Cosmetics Pharmaceutical Pvt. Ltd., which held that payment of education cess can be made by utilizing Cenvat Credit of basic excise duty. - The Tribunal further confirmed that Rule 3 of the Cenvat Credit Rules, 2004 allows the utilization of basic excise duty for payment of NCCD, and there is no restriction against such utilization. Conclusion: - The Tribunal upheld the orders passed by the lower authorities, stating that they were proper and legal. - The appeals filed by the Revenue were dismissed, confirming that the respondent is entitled to utilize the Cenvat credit of basic excise duty for the payment of NCCD. Final Pronouncement: - The impugned orders were upheld, and the Revenue's appeals were dismissed. Date of Pronouncement: - The judgment was pronounced in the open court on 30.08.2024.
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