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TMI Blog2024 (8) TMI 1492X X X X Extracts X X X X X X X X Extracts X X X X ..... F INDIA 2 [ 2014 (12) TMI 585 - GUJARAT HIGH COURT] has struck down Rule 8(3A) as unconstitutional on the ground that the prescribed Rule which says that the duty has to be paid without using the Cenvat credit is arbitrary and infringement of substantive right of Cenvat credit. The Hon ble High Court in the case of M/S. MALLADI DRUGS PHARMACEUTICALS LTD. VERSUS THE UNION OF INDIA, THE COMMISSIONER OF CENTRAL EXCISE [ 2015 (5) TMI 603 - MADRAS HIGH COURT] had declared the provision to be unconstitutional. Once the provision is declared by any High Court as unconstitutional then the said provision is non-existent. The demand cannot sustain. In the result, the impugned order is set aside - The appeal is allowed. - HON BLE MS. SULEKHA BEEVI. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l without utilizing the Cenvat Credit till the date the assessee pays the outstanding amount including interest thereon, and in event of any failure, it shall be deemed that such goods have been cleared without payment of duty and for the consequences and penalties as provided in these rules shall apply. 4. From the details of payment made by the appellant, it was seen that without paying the defaulted amount in cash on consignment basis, the assessee continued to utilize Cenvat Credit of Rs for payment of Central Excise Duty for the period from June 2013 to December 2013. This was in violation of Rule 8(3A) of Central Excise Rules, 2002. It appeared to the department that appellant has contravened Rule 8(3A) of the Central Excise Rules 200 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the outstanding amount including interest thereon and in the event of any failure, it shall be deemed that such goods have been cleared without payment of duty and the consequences and penalties as provided in these rules shall follow. 8. The Ld. Counsel submitted that the said rule has been struck down as unconstitutional and ultra vires by the Hon ble High Court of Gujarat in the case of M/s. Indsur Global Ltd., reported in 2014 (310) ELT 833(Gujarat). The decision was followed by the Hon ble High Court of Madras in the case of M/s. Malladi Drugs Pharmaceuticals Ltd., reported in 2015 (323) ELT 489 (Mad.) 9. The Ld. Counsel submitted that the department had filed an appeal before the Hon ble Supreme Court against the decision passed by th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ral Excise Rules, 2002 has been struck down as unconstitutional by the Hon ble High Courts and therefore the confirmation of demand cannot sustain. 17. The Hon ble High Court in the case of Indsur Global Ltd.,(supra) has struck down Rule 8(3A) as unconstitutional on the ground that the prescribed Rule which says that the duty has to be paid without using the Cenvat credit is arbitrary and infringement of substantive right of Cenvat credit. 18. The Hon ble Jurisdictional High Court has followed the decision of the Hon ble Gujarat High Court in the case of Indsur Global Ltd.,(supra). The decision rendered by the Hon ble High Court of Gujarat in the case of Indsur Global Ltd., was appealed before the Hon ble Apex Court by the department. It is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dgment of any High Court upholding it and where the appeals against these judgments have been admitted and are under consideration of the Hon ble Apex Court, whether the ratio of these judgments bind this tribunal or otherwise. We find that the last in the series of judgments was passed by the Hon ble High Court of Bombay in the case of Nashik Forge (p.) Ltd. (supra) on 17-9-2018 holding that the ratio of the judgment of the decision of the Hon ble High court of Madras, Gujarat and Punjab Haryana apply. Respectfully following the decision of the Hon ble High Court of Bombay, we follow the ration of the aforesaid judgments of the Hon ble High Courts and hold that the demand is unsustainable and needs to be set aside. Consequently, penalties ..... X X X X Extracts X X X X X X X X Extracts X X X X
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