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TMI Blog2022 (10) TMI 645X X X X Extracts X X X X X X X X Extracts X X X X ..... rmed by the Tribunal raising the issue of extent of credit eligibility and also the impact of the doctrine of unjust enrichment is beyond the scope of the show cause notice. The Appellate Authority be it the Commissioner (Appeals) or the Tribunal is not empowered to issue directions which traverse beyond show cause notice. It seems that the order of the Tribunal affirming the order of the Commissioner (Appeals) is bad insofar as it affirms directions which traverse beyond show cause notice and hence it is set aside. Appeal allowed. - C.M.A. No.2253 of 2005 And C.M.P. Nos.12029 and 12030 of 2005 - - - Dated:- 1-9-2022 - Honourable Mr. Justice R. Mahadevan And Honourable Mr. Justice Mohammed Shaffiq For the Appellant : Mr. T.Mohan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of ''manufacture'' contained in Section 2(1) of CEA and read with any Chapter Note given in the CEA, the rejected goods cannot be considered as ''inputs''. Therefore, I pass the following order. ORDER I disallow the CENVAT credit of Rs.27,86,573/- - (BED : Rs.23,21,069-AED(T TA) : Rs.6225/- and AED (GST):Rs.459279/-) taken by MCL on the rejected final products mentioned against the sl.nos.1 to 51 of Annexure B to the Show Cause Notice OC No.2/2002 dated 3.1.2002 and order recovery of the said amount from MCL under Section 11A(1) of CEA read with rule 57AH of Rules read with rule 12 of CCR and read with Section 38A of the CEA. The amount of credit of Rs.2070/- said to have been reversed already may b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... thus extracted: ''The dispute of allowing credit on the duty paid rejected/returned inputs has been finally settled by the Larger Bench of the Tribunal in favour of the manufacturers in the case of Hindalco Industries Ltd., Vs. CCE 2000 (119) ELT 711 (Tri- LB). However, in that case the inputs returned were subjected to the process of remanufacture. Nevertheless, the South Zonal Bench of the Tribunal in the case of Lakshmi Machine Works Ltd., Vs. CCE 2002 (144) ELT 424 (Tri-Chennai) permitted the manufacturer to avail MODVAT/CENVAT credit on the returned goods (since both inputs as well as final products being notified), despite there being specific provisions under Rule 173 H and 173 L. The South Zonal Bench of the Tribuna ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed by the same, the appellant preferred an appeal before the Tribunal on the premise that the direction on remand in an appeal proceedings by the Commissioner (Appeals) traverses beyond the scope of the Show Cause Notice and it is impermissible for an Appellate Authority. The Tribunal rejected the above plea of the appellant and confirmed the directions issued by the 1st appellate authority on the premise that the directions issued by the Commissioner (Appeals) is incidental to the relief sought and that the directions are not something which are impracticable. The finding of the Tribunal is extracted as under: ''5. We are not able to subscribe to the view of the appellants that the Commissioner(Appeals) traversed beyond the sco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts: a. GTC Industries Vs. CCE [1997 (94) E.L.T.9] case, the Supreme Court held that: ''As we see it, each show cause notice must be limited to the case that is made out therein by the Revenue. It is not within the jurisdiction of the Tribunal to direct otherwise; to do so is to go beyond its purely adjudicatory function.'' b. Reckitt Colman of India Ltd., Vs. Collector of Central Excise 1996 (088) E.L.T.641 (SC), in para 3, it was held that: ''It was beyond the competence of the Tribunal to make out in favour of the Revenue a case which the Revenue had never canvassed and which the appellant had never been required to meet. It is upon this ground alone that the appeal must succeed.'' ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to whether the issue of imposing a cap on the extent of the credit to which the appellant is not available and unjust enrichment, was never part of the Show Cause Notice and thus, the directions of the 1st Appellate Authority affirmed by the Tribunal raising the issue of extent of credit eligibility and also the impact of the doctrine of unjust enrichment is beyond the scope of the show cause notice. The Appellate Authority be it the Commissioner (Appeals) or the Tribunal is not empowered to issue directions which traverse beyond show cause notice. It seems that the order of the Tribunal affirming the order of the Commissioner (Appeals) is bad insofar as it affirms directions which traverse beyond show cause notice and hence it is set aside ..... X X X X Extracts X X X X X X X X Extracts X X X X
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