9911796707
TMI Blog2021 (10) TMI 1030X X X X Extracts X X X X X X X X Extracts X X X X ..... an error in the returns filed with the Central Excise Department mentioning Serial No.336 instead of 338 of Notification No.12/2012 - Central Excise dated 17.03.2012 in regard to some supplies of lubricants effected by it. The Department adopted the view that the commodity supplied, being lubricant, was only used as a coolant/lubricating agent and hence did not entitle the petitioner to the exemption sought. 4. A show cause notice thus came to be issued on 18.09.2014 to which a response were filed by the petitioner culminating in an Order-in-original that travelled in appeal before the Customs, Excise and Service Tax Appellate Tribunal (CESTAT). Since the SVLDRS Scheme had been rolled out pending appeal, the petitioner sought settlement of the dispute arising under the aforesaid show cause notice, which has come to be rejected by way of the impugned order dated 21.12.2019. Hence the present Writ Petition. 5. The case of the petitioner is that the show cause notice dated 18.09.2014 specifically refers to 'lubricants' falling under Chapter 27 of the first schedule to the Act. Thus the dispute sought to be resolved would have to be seen in the context of the lis arising from the sho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nded to reduce pendency of litigation and benefit tax payers and hence should be liberally construed. 12. In Indian Oil Corporation V. Union of India and two others (2020 - TIOL-2122-HC-ALL-CX), the commodity in question was Superior Kerosene Oil (SKO). The Division Bench of the Allahabad High Court considered an SVLDRS application filed by the same petitioner as before me though a different unit. The application had come to be rejected on the identical premise as in the present matter and similar contentions as advanced in this case came to be considered by the Court that held adverse to the petitioner therein. 13. The Bench has gone on a plain reading of Section 3 of the Central Excise Act, 1944, the charging Section, which states that central excise would be leviable on all excisable goods which are produced or manufactured in India at the rates set forth in the 4th schedule. Thus, according to the Bench, irrespective of whether a positive number is stated alongside the commodity, the mere mention of that commodity in the schedule would disentitle the manufacturer of those goods to avail of the benefit of the SVLDRS Scheme. 14. As regards the contention that GST was being cha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the relief sought. 16. The revenue relies on the judgments of the Hon'ble Supreme Court in Wallace Flour Mills Company Ltd. V. Collector of Central Excise (1989 (44) ELT 598) and Tamil Nadu (Madras State) Handloom Weavers Co-operative Society Ltd. V. Assistant Collector of Central Excise (1978 (2) ELT (J57)). 17. I have heard learned counsel and perused the files carefully. The SVLDRS Scheme is a comprehensive code that provides for the settlement of arrears under several indirect tax enactments. Section 125 provides for some exclusions from the Scheme in the following terms: 125. (1) All persons shall be eligible to make a declaration under this Scheme except the following, namely:- (a) who have filed an appeal before the appellate forum and such appeal has been heard finally on or before the 30th day of June, 2019; (b) who have been convicted for any offence punishable under any provision of the indirect tax enactment for the matter for which he intends to file a declaration; (c) who have been issued a show cause notice, under indirect tax enactment and the final hearing has taken place on or before the 30th day of June, 2019; (d) who have been issued a show cause no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oods produced or manufactured ipso facto do not attract duty unless they are marketable or capable of being marketed, we may now examine the dutiability of goods captively consumed. Prior to 1979 no duty was levied on such goods. But, as stated earlier, after amendment of rules 9 and 49 captively consumed goods become exigible to duty. The rationale for not treating such goods as excisable was same that since such goods were not brought to the market for buying and selling they could not be subjected to duty. But when the Rules were amended a fiction was created that any article produced or manufactured if captively consumed was statutorily presumed to satisfy the test of marketability. But this presumption can be rebutted if it is established that the article produced and captively consumed was neither goods nor marketable nor capable of being marketed. The duty is attracted not by captive consumption of any article but it must be a good within the meaning of the Act which apart from having a distinctive name and known as such must be marketable or capable of being marketed. In Bhor Industries (supra) crude PVC films manufactured by the appellants as intermediate product used for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r with the Schedules under the Central Excise Tariff Act, 1985 would show that all goods produced or manufactured in India can be classified into the following categories: (i) Goods which are not excisable, in view of the fact that they are not even mentioned in the Schedules to the Central Excise Tariff Act, 1985. (ii) Goods which are excisable at nil rate of duty, in view of the fact that they are included in the Schedule to the Central Excise Act, 1985, but the rate of duty is indicated in those schedules as zero. (iii) Goods which are excisable at the rates specified in the Schedules under the Central Excise Tariff Act, 1985, but which are granted exemption, in terms of a Notification issued under Section 5A of the Central Excise Act, 1944. 24. Though the Writ Petitions came to be dismissed, the categorisation of goods at clause (ii) above reiterates the position that one of the classes of goods covered by the Act are those that are excisable at 'nil' rate of duty. Such goods, though included in the schedules to the Act have not been attributed with a positive rate of duty, such rate merely indicated as '0' or '.......'. In my considered view, though this class of goods ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... excisable goods, there was no need or occasion for exempting the same from the levy of excise duty. We are unable to agree with the learned Counsel for the petitioner that once the handloom fabrics are exempted from excise duty, they cease to be excisable goods. As we have already pointed out, the character as excisable goods does not depend on the actual levy of duty, but on the description as excisable goods in the First Schedule to the Act. We are, therefore, unable to interfere with the orders of the respondents. 28. There is no quarrel with the proposition that exempt goods continue to be excisable goods, though the rate of duty is stipulated as 'nil'. However, that is not the question that arises for consideration before me. It is nobody's case that lubricants are exempt from central excise duty. Undoubtedly, they figure as goods under Schedule 4. However, the rate of duty stipulated is '....' and, in my considered view, lubricants cannot be considered to be excisable goods, in such circumstances, for the purposes of the SVLDRS Scheme. The SVLDRS Scheme has been brought into to weed out pending litigations where possible and where the litigation falls within the limits set ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
