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TMI Blog2012 (11) TMI 817X X X X Extracts X X X X X X X X Extracts X X X X ..... ho are mere traders and not manufacturers, obviously, cannot claim CENVAT Credit under the CENVAT Credit Rules, 2004 and accordingly, has to pay the excise duty on coal at the rate of 5% plus cess on duty as a purchaser. - Decided against the petitioner. - 2489, 3814, 3818, 3824 and 3877 of 2011 - - - Dated:- 20-1-2012 - N. Kotiswar Singh, J. REPRESENTED BY : S/Shri G.N. Sahewalla, Sr. Advocate and P. Deka, Advocate, for the Petitioner. S/Shri M.Z. Ahmed, Sr. Standing Counsel and B. Dutta, Advocate, for the Respondent. [Order (CAV)]. The present 5 (five) writ petitions involve common question of law and also as agreed by the parties, all these petitions are heard together and are being disposed of by this common judgment and order. Heard Mr. G.N. Sahewalla, learned senior counsel assisted by Mr. P. Deka, learned counsel appearing for the petitioners. Also heard Mr. M.Z. Ahmed, learned senior counsel assisted by Ms. B. Dutta, learned counsel appearing for the respondents No. 1 to 7. 2. The writ petitioners are limited companies registered under the Indian Companies Act, 1956 having their offices at Guwahati/in Punjab and doing business in coal by way of purc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ax on input services has been taken under the provisions of the CENVAT Credit Rules, 2004. TABLE Sl. No. Chapter or heading or sub-heading or tariff item of the First Schedule Description of the excisable goods .. .. .. 28. 2701 All goods .. It is stated that coal comes under Sl. No. 28 of the aforesaid Table. 4. According to the petitioners, in view of the aforesaid notification dated 1-3-2011 issued by the Government of India, the respondents/authorities of the Coal India Limited also issued a notice on 3-3-2011 stating that coal would be subject to central excise duty at the rate of 1% provided, no CENVAT Credit is availed under the provisions of the CENVAT Credit Rules, 2004. The petitioners also state that the General Manager (Finance) Central Coal Fields Ltd., Ranchi issued a letter to the various Chief General Managers under his jurisdiction on 9-3-2011 regarding charging of duty at 1% plus and 3% on the duty as education cess. 5. It is the case of the petitioners that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 11, full exemption earlier available to a manufacturer of coal, along with other items, has been withdrawn by the Union Government and has imposed Central excise duty at the rate of 5% plus cess of 3% on duty on coal (effective rate - 5.15%) w.e.f. 1-3-2011 by amending Clause (viii) of the Tenth Schedule of the Finance Bill, 2011. In view of the aforesaid imposition of excise duty on coal, the aforesaid excise duty at the rate of 5% is now leviable on coal. Government of India also issued a notification under sub-section (1) of Section 5A of the Central Excise Act, 1944 being Notification No. 1/2011-C.E., dated 1-3-2011 by which exemption has been given in respect of excisable goods as given in the said notification (which includes coal ), from so much of the duty of excise leviable thereon under the said Central Excise Act, 1944, as is in excess of the amount calculated at the rate of 1% ad valorem. However, it has been also provided in the said notification that the aforesaid exemption will not be applicable in respect of the goods in respect of which credit of duty on inputs or tax on input services has been taken under the provisions of CENVAT Credit Rules, 2004. (iii) It i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on excise duty, they could always claim for refund of the excise duty by taking recourse to Section 11(B) of the Central Excise Act, 1944 which provides for alternative remedy for claim of the refund of the excise duty and as such the present writ petitions are not maintainable and has relied on a number of judgments rendered by the Supreme Court in Dhampur Sugar Mills v. State of U.P. and Others - (2007) 8 SCC 338, Godrej Sara Lee Limited v. Assistant Commissioner (AA) and Another - (2009) 14 SCC 338 = 2009 (236) E.L.T. 425 (S.C.). 9. I have heard and considered the rival contentions of the parties. As regards the fact that coal now attracts excise duty at the rate of 5% plus cess w.e.f. 1-3-2011 is not disputed. What is also not disputed is that the Government of India had issued a notification under No. 1/2011-C.E., dated 1-3-2011 by which certain excisable goods including Coal have been exempted from so much of the excise duty as is in excess of the amount calculated at the rate of 1% ad valorem. It is also not disputed that as per the aforesaid notification dated 1-3-2011, such exemption will not be applicable to the goods in respect of which credit of duty on input ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tification No. 1/2011-C.E., dated 1-3-2011 would be leviable on coal. This contention of the writ petitioners, however, cannot be accepted in as much as it has not been pleaded anywhere by the writ petitioners that the Coal India Ltd. is not entitled to take CENVAT Credit under the CENVAT Credit Rules, 2004 even though it had been specifically claimed in the affidavit-in-opposition of the Coal India Ltd. that the Company had decided to avail of the CENVAT credit under the CENVAT Credit Rules, 2004. Further, it may be also observed that merely because of the fact that inputs for manufacture of coal by the Company may be negligible, it would not disentitle the Company to take CENVAT Credit under the CENVAT Credit Rules, 2004 if they so desire. 12. The respondent Coal India Ltd. has very categorically stated that as a matter of policy and after due deliberation, the Company had decided to avail of the CENVAT credit facility under CENVAT Credit Rules, 2004 as stated in their affidavit-in-opposition. The petitioners have not filed any rejoinder affidavit to contest the claim of the Coal India Ltd. that the Coal India Ltd. is availing CENVAT credit under the CENVAT Credit Rules, 20 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it Rules, 2004, the exemption provided under Notification No. 1/2011-C.E, dated 1-3-2011 will not be applicable. Therefore, excise duty at the rate of 5% would be leviable on coal . The writ petitioners who are mere traders and not manufacturers, obviously, cannot claim CENVAT Credit under the CENVAT Credit Rules, 2004 and accordingly, has to pay the excise duty on coal at the rate of 5% plus cess on duty as a purchaser. 17. Accordingly, this Court is of the opinion that Coal India Ltd. is entitled to levy excise duty at the rate of 5.15% (which includes cess), as has been done, in respect of coal sold by them to any other person including the petitioners, since the Company had decided to avail the CENVAT credit under the CENVAT Credit Rules, 2004 as stated by them. The exemption given to the excise duty in excess of the amount calculated at the rate of 1% ad valorem as per Notification No. 1/2011-C.E., dated 1-3-2011 will not be applicable so long as Coal India Ltd. takes CENVAT Credit under the CENVAT Credit Rules, 2004. 18. In view of the above finding, consideration of other issues raised in the writ petitions may not be necessary. 19. Accordingly, the present petitions ..... X X X X Extracts X X X X X X X X Extracts X X X X
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