9911796707
TMI Blog2018 (5) TMI 665X X X X Extracts X X X X X X X X Extracts X X X X ..... % of duty. However, if any balance credit is available the same stands reversed by the appellant which leads to a situation where the entire credit so availed by the appellant stand either utilized for payment of 40% tariff rate or stands reversed and is not available with the appellant. It can be concluded that no credit stands availed by them so as to benefit them at any point of time. It will amount to Revenue neutral situation as credit availed by the appellant would become nil and as such the condition of the Notification No.8/03-CE, stands fulfilled by the assessee. Instead of raising differential duty, at full rate of duty, the Revenue should have extended the benefit of Notification No..8/03-CE to the assessee N/N. 9/03-CE dated 1.3.2003 has prescribed effective rate of duty at the rate of 60% of tariff rate. It is settled position of law that if the duty is paid under mistake of law it should be compensated towards recovery of cenvat credit. In view of the said settled position of law, I agree with the view expressed by Member (J). In view of the majority order, the impugned order is set aside and the appeal is allowed with consequential relief. - Appeal No. E/255 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... imposition of penalty. The appeal stands rejected by the lower authorities and hence the present appeal. 5. The main contention of the appellant is that they continued to avail notification in question under mistaken belief and inadvertently that the said notification was holding the field during the relevant period. However, they contended that if concessional rate was not available to them in terms of notification No.09/03-CE, Notf.No.8/03-CE which provided nil rate of duty was admittedly available to them. Inasmuch as they fulfilled all the conditions being SSI industries. As such, they could have cleared the goods without payment of duty and without availing the credit. Learned Advocate submits that by availing the credit and paying concessional rate of duty, the appellant does not stand benefited in any manner, inasmuch as the credit so availed by them was used for payment of duty. 6. The lower authorities have not considered the admissibility of the notification No.8/03-CE and passed orders against them thus giving rise to present appeal. 7. The contention of the learned AR appearing for the Revenue is that the said notification is conditional notification which r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aised the contention before the authorities below that in the absence of notification No.9/03-CE, they would have availed notification 8/03-CE. The lower authorities have confirmed the demand on the ground that notification No.9/03-CE was not on the statute book and as such, the appellant was not entitled to concessional rate of duty and are required to pay full rate of duty. In our view, the appellant s claim to examine the applicability of notification No.8/03-CE is very relevant and should have been examined. 11. While examining the applicability of notification No.8/03-CE, we find that the same extends the benefit of nil rate of duty to the assessee for the first clearances upto aggregate value of ₹ 1 crore. One of the conditions of the notification is that the appellant would not be entitled to credit. As such, it leads to a situation where no credit stands availed, no duty is payable on the final products. The Revenue s objection is that the appellant had availed the credit and paid duty on the final products by utilizing the same. We have to keep in mind that we are examining the applicability of notification no.8/03-CE at a stage where the demand of differential du ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing the financial year 2006-07, but paid excise duty @ 9.6% instead of 16% tariff rate of duty, the Department issued them show cause notice demanding differential duty of ₹ 2,89,435/- along with interest and imposition of penalty. The matter was adjudicated and the demand of duty along with interest was confirmed. Penalty of equivalent amount was also imposed under Section 11AC. The appellant went in appeal but the same was dismissed. Aggrieved from the same, they have filed this appeal. 14. Since the contentions of the appellant s Advocate and the AR have been brought out in para 5,6 and 7, the same are not being repeated. 15. From the facts, it emerge that the notification No.9/03-CE, under which an assessee was allowed to take Cenvat credit and concessional rate of duty @ 9.6%, was no longer in existence during the impugned period because the same had been rescinded with effect from 1.3.2005. Hence, the appellant had been availing the benefit of notification which did not exist. Further, the contention of the appellant that the lower authorities have not considered the admissibility of the Notification No. 8/03-CE is not factually correct as the same has been duly ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fied in the said Table does not exceed rupees one hundred lakhs; 17. From the reading of above conditions, it is evident that the third condition 2(iii) requires that the manufacturer shall not avail the credit of duty on inputs under Rule 3 or Rule11 of Cenvat Credit Rules. Admittedly, the appellant have availed the Cenvat credit on inputs and utilized the same for payment of duty. Therefore, condition 2(iii) is not fulfilled. Hence, without fulfilling the condition mentioned in para 2(iii) of the notification ,which is clearly spelt out, the benefit of notification is not available to the appellant. I find that therein a number of judicial pronouncements, the Hon ble Apex Court has held that the assessee is required to fulfil the conditions of the notification in strict sense if it wants to avail the benefit of exemption notification. Once it is found that the conditions have not been fulfilled, obvious consequence would be that the assessee was not entitled to the benefit of notification No.8/03-CE. Hence, there is no infirmity in the order of the lower authorities in denying the benefit of the notification and confirming the demand and interest. 18. The appellant have ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... venue is that the Notification No.9/03-CE is not available with effect from 6.4.2005 and therefore the benefit of the same cannot be enjoyed by the appellant, after 6.4.2005. 26. Heard learned Counsel for the appellant. He has submitted that for many years two notifications were being issued one with facility of credit and without facility of credit for small scale units and on 6.4.2005 one was withdrawn. It is not the case of the Revenue that the appellants have only availed the cenvat credit. The appellants have also paid duty of Central Excise as provided in the Notification No.9/03-CE, therefore, it should be treated as mistake of law. He therefore, pleaded for allowing the appeal. 27. Having considered the rival contentions. I find that Notification No.9/03-CE dated 1.3.2003 has prescribed effective rate of duty at the rate of 60% of tariff rate. It is settled position of law that if the duty is paid under mistake of law it should be compensated towards recovery of cenvat credit. In view of the said settled position of law, I agree with the view expressed by Member (J). 28. With the aforesaid opinion, I return the back the file to the Division Bench. ( Order dicta ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
