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TMI Blog2013 (9) TMI 91X X X X Extracts X X X X X X X X Extracts X X X X ..... ing in proportion to the quantity of the Zinc Ash part of the Zinc Skimmings used in the manufacture of the exempted product Zinc Sulphate, the provisions of Rule 6(3) would not be applicable. Even if the manufacturer wanted to fulfil the condition of Rule 6(2), he cannot do so, as it was impossible - it would be impossible for the Appellant to maintain separate account and inventory of Zinc Skimming meant for use in the manufacture of Zinc Sulphate and the Zinc Skimming meant for use in the manufacture of Zinc Ingots - Lex Non Cogit ad impossibilia - Law does not compel a person to do that which was impossible, was a well settled legal principle applied even in taxation matters. Prima facie it was impossible for the Appellants to maintain separate account and inventory of Zinc Skimming used for manufacture of Zinc Ingots and Zinc Sulphate (Agriculture grade) for the reason that one final product was the by product of the other, Rule 6(3)(b)/6(3)(i) read with Rule 6(2) of Cenvat Credit Rules, cannot be invoked - the Appellants were following the next best option - determining the proportionate Cenvat credit attributable to Zinc ash component of the Zinc Skimming and not avail ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 09 was confirmed against M/s. Bhoomi Sudhar Chemical Industries along with interest and duty demand of Rs. 76,66,527/- for the same period was confirmed against M/s. Ganesh Agro along with interest. The adjudicating authority besides confirming the abovementioned amount against the appellants under Rule 6(3)(b)/6(3)(i) of Cenvat Credit Rules, 2004 also imposed penalties of equal amount on them under Rule 15(2) of the Cenvat Credit Rules, 2004 read with Section 11AC of Central Excise Act, 1944. Against these two orders of Commissioner (Appeals), the present appeals along with Stay Applications have been filed. 3. Heard both the sides. 4. Shri N.K. Garg, Advocate, the learned Counsel for the appellants, pleaded that during the period from January, 2008 to April, 2008, neither any additional Customs duty had been paid in respect of imported Zinc Skimmings nor any Cenvat credit had been taken and hence the question of payment of 10% amount does not arise, that for January, 2008 to April, 2008 period, only Special Additional Customs Duty (SAD) had been paid on imported Zinc Skimming but its Cenvat credit was not taken, that service tax credit initially taken in respect of GTA Servic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d be liable to pay an amount of 10% of the value of the exempted final products. He, therefore, pleaded that these are not the cases for total waiver from the requirement of pre-deposit. 6. We have carefully considered the submissions from both the sides and perused the records. The appellants imported the Zinc Skimmings which consists of Zinc metal and Zinc Ash. The Zinc Skimming is subjected to pulverization and sieving and in this process, the metallic part and Zinc Ash part is separated. The metallic part is converted into Zinc Ingots and cleared on payment of duty. The Zinc Ash part, is subjected to chemical process by treating the same with sulphuric acid by which agricultural grade Zinc Sulphate is manufactured which is an exempted goods. Cenvat credit has been taken on the additional customs duty paid on Zinc Skimming during certain period. For January, 2008 to April, 2009, the Appellant s claim that neither Additional Customs duty was paid on Zinc Skimming nor its credit was taken and the credit of service tax on GTA and CHA services availed was subsequently reversed, has not been disputed by the Department. We are of prima facie view that when during this period no cred ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le and the other exempted is common and one product is obtained as inevitable by product of the other. In such a situation, even if the manufacturer wants to fulfil the condition of Rule 6(2), he cannot do so, as it is impossible. In this case, it would be impossible for the Appellant to maintain separate account and inventory of Zinc Skimming meant for use in the manufacture of Zinc Sulphate and the Zinc Skimming meant for use in the manufacture of Zinc Ingots. Lex Non Cogit ad impossibilia - Law does not compel a person to do that which is impossible, is a well settled legal principle applied even in taxation matters. Hon ble Allahabad High Court in case of Commissioner of Income Tax v. Premkumar reported in 2008 (214) CTR 452 (All.) while dealing with the question whether an assessee can be faulted for not declaring the amount of capital goods on acquisition of land when the amount of compensation itself is not determined, held as follows : Lex Non Cogit ad impossibilia is an age old maxim meaning that the law does not compel a man to do which he cannot possibly perform. Requiring the assessee to file a proper and complete return by including the income under the head Capita ..... X X X X Extracts X X X X X X X X Extracts X X X X
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