9911796707
Advanced Search 
TMI Blog2018 (9) TMI 200X X X X Extracts X X X X X X X X Extracts X X X X ..... eferred to as the CEA, 1944 ), as it stood then, confirmed the demand of Rs. 8,08,730/- being the Cenvat credit availed along with education cess in terms of proviso to Section 11A(1) of the CEA, 1944 read with Rule 14 of the Cenvat Credit Rules, 2004 (hereinafter referred to as the CCR, 2004 ) and the Adjudicating Authority demanded interest at an appropriate rate under Sections 11AB and 11AA of the CEA, 1944 read with Rule 14 of the CCR, 2004 and also imposed penalty of equivalent sum of Rs. 8,08,730/-. 3.Before the Commissioner (Appeals), the assessee contended that they were availing S.S.I. exemption under Notification No.8/2003-CE as amended and had taken Cenvat credit on capital goods received from July 2008 to March 2009 and the Cenvat credit taken was kept in balance in their Cenvat credit account in March 2009 and carried over up to March 2011. 4.The assessee further submitted that during July 2011, the Department requested information of the credit availed by them. They provided necessary details and it was pointed out that depreciation of capital goods availed under Section 32 of the Income Tax Act, 1961 cannot be availed as Cenvat credit and therefore, the said amount ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d on the capital goods in view of the judgment in the Hon'ble Supreme Court in the case of Union of India versus Rajasthan Spinning & Weaving Mills in Civil Appeal Nos.3527 and 3525 of 2009 decided on 12.05.2009 wherein it has been clarified that when the conditions spelled out under Section 11AC of the Central Excise Act, 1944 are fulfilled, there is no discretion to reduce the mandatory penalty equal to duty even though the duty is paid before the issue of Show Cause Notice" 9.We have heard Mr.A.P.Srinivas, learned Senior Standing Counsel for the appellant/Revenue and M/s.D.Naveena, learned counsel appearing for the respondent/assessee. 10.Before we venture to consider the legal position, more particularly, the effect of the decision in Bombay Dyeing & Manufacturing Co. Ltd. (supra), we have to point out that on facts, we are not inclined to interfere with the order passed by the Tribunal for more than one reason. Firstly, the Revenue did not dispute the fact that the assessee is an S.S.I. and has not availed the Cenvat credit and the credit remains as an entry in the books. Therefore, on facts, it will be a very hard case for the Court to reverse the decision of the Tribun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vider of the output service and the provisions of Sections 11-A and 11-AB of the Excise Act or Sections 73 and 75 of the Finance Act, shall apply mutatis mutandis for effecting such recoveries." .............................. 19.A taxing statute must be interpreted in the light of what is clearly expressed. It is not permissible to import provisions in a taxing statute so as to supply any assumed deficiency. In support of the same we may refer to the decision of this Court in Commissioner Of Sales Tax, U.P v. Modi Sugar Mills Ltd. 1961 2 SCR 189 wherein this Court at AIR para 11 has observed as follows: "10. ........... In interpreting a taxing statute, equitable considerations are entirely out of place. Nor can taxing statutes be interpreted on any presumptions or assumptions. The court must look squarely at the words of the statute and interpret them. It must interpret a taxing statute in the light of what is clearly expressed: it cannot imply anything which is not expressed; it cannot import provisions in the statutes so as to supply any assumed deficiency." 20.Therefore, the attempt of the High Court to read down the provision by way of substituting the word or b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e, the High Court read down the Rule to mean that where CENVAT credit has been taken and utilized wrongly, interest should be payable from the date the CENVAT credit has been utilized wrongly and interest should not be claimed simply for the reason that the CENVAT credit has been wrongly taken as such availment by itself does not create any liability of payment of excise duty. The assessee's case in this appeal is that the credit has been reversed. Therefore, mere wrong availment will not attract payment of interest as reversal of credit would amount to "no credit" being taken. The Hon'ble Supreme Court held that the High Court misread and misinterpreted Rule 14 and wrongly read it down without properly appreciating the scope and limitation thereof. It further pointed out that a statutory provision is generally read down in order to save the said provision from being declared unconstitutional or illegal and Rule 14 specifically provides that where CENVAT credit has been taken or utilized wrongly or has been erroneously refunded, the same along with interest would be recovered from the manufacturer or the provider of the output service and the issue is as to whether the afor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ether reversal of credit after the removal of the final product would entitle the assessee therein to the benefits of exemption notification, which states that the reversal of the credit should be done before the removal of the products. In such circumstances, the Courts considered the issue and said that for the purpose of extending the benefits of exemption notification, the time of reversal was not the material and reversal of the credit would amount to "no credit" being taken. In these decisions, rule 14 or section 11ab was not the subject matter for consideration. Therefore, these decisions relied upon by the learned counsel for the assessee are clearly distinguishable by facts, while read in the context of the facts and relevant notification which are applicable to the facts of the case. .................... 13. The learned counsel for the assessee submitted his notes on the contention that interest being compensatory and that question of payment of interest would arise only where the principal is due. To that contention, by placing reliance on the decision reported in 1996 (88) ELT 12 (SC) (Prathiba Processors vs. Union of India as well as the decision reported in 2007 ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
