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TMI Blog2024 (12) TMI 668X X X X Extracts X X X X X X X X Extracts X X X X ..... deny the availment of CENVAT credit to the appellants. Interestingly, instead of countering the submissions of the appellant and instead of highlighting any allegations in the SCN, on the issue of inadmissibility of credit, Commissioner observes that this response from the noticee only blandly refutes the allegation of SCNs but does not present any cogent legal argument in support of the contention that the noticee was eligible to take the credit and use it for the purpose for which it actually got used; on the other hand, the reply makes incorrect assertions; it is incorrect for the noticee to state that the SCNs have no alleged that the CENVAT has been incorrectly taken; the SCNs have made the point that the CENVAT has been incorrectly taken and utilized and have raised a demand under Sec 11A accordingly. There is no reference to Rule 14 which empowers the Department to recover CENVAT credit wrongly taken or erroneously refunded. The entire tone of the Show Cause Notice was to recover the duty paid on the finished goods utilizing the CENVAT credit. This being the position, it is correct on the part of the appellants to say that the impugned order has travelled beyond the Show Cau ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t of duty, which would have been paid through PLA; as the Hon ble Apex Court has decided the issue holding that processing of uncoated paper did not amount to manufacture, no duty is payable by the appellants and it is immaterial and irrelevant whether such duty was paid through cash or CENVAT credit. He submits that there was no dispute with regard to availment of CENVAT credit; once the said credit was admissible, the appellant rightly utilized the same for the payment of duty on the final product cleared by them; there is no one-to-one co-relation, between inputs and final products, is required; cross utilization of credit is permissible; utilization of credit cannot be disallowed when the availment of credit itself was not disputed. 3. Learned Counsel further submits that the Show Cause Notices were issued demanding duty on the final product whereas the impugned order travelled beyond the Show Cause Notice and decided the issue which was not raised in the Show Cause Notice; there was no proposal in the Show Cause Notices to deny input tax credit; the Department disputed only the cross utilization of credit; in the absence of such allegation, the impugned order was not correct i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 365) ELT 594 (Tri-Chan.) Commissioner, Goods Services Tax Commissionerate v. Shree Krishna Paper Mills Industries Ltd. Others - CEA No. 36 of 2019 (P H High Court) 5. Learned Authorized Representative submits that the question of eligibility of the appellant to take CENVAT credit is question by the Department while recording the statement of Shri D.N. Ram, Deputy Manager (Excise) and Authorized Representative of the appellant; learned adjudicating authority has categorically held that the Assistant Commissioner vide his letter dated 12.01.2004 asked the appellants to ensure the correct amount of CENVAT credit is availed in case they opted for clearance of goods without payment of duty. Learned Authorized Representative further submits that the case laws relied upon by the appellant is not relevant as the facts of the cases dealt therein are different from the impugned case. 6. Heard both sides and perused the records of the case. The appellants are engaged in the processing of uncoated paper; the appellants stopped payment of duty on the final products consequent to the decision of Tribunal in the case of Pitambar Coated Paper Ltd. (supra) wherein it was held that coating of the pa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ntioned excisable goods without payment of duty should not be recovered from them under Section 11A of Central Excise Act, 1944. (2) Central Excise duty amounting to Rs. 14,97,953/-, short paid on clearance of excisable goods cleared by utilizing the CENVAT credit taken contained in those inputs which were used in the products cleared without payment of duty should not be recovered from them under Section 11A of Central Excise Act, 1944 being irregularly utilized from RG-23A part-II in contravention of the provisions of the Rule 12 of CENVAT credit Rules 2002. (3) Penalty under Rule 25 of the Central Excise Rules, 2002 and under Rule 13 of CENVAT credit Rules 2002 should not be imposed on them. (4) Interest at the applicable rate should not be charged and recovered from them under section 11 AB of the Central Excise Act, 1944. 8. We find that all the Show Cause Notices are in the same tenor as above. We also find that as submitted by the learned counsel for the appellants, there is no discussion in the Show Cause Notice on the unavailability of CENVAT credit to the appellant. Utilization of CENVAT credit was not disputed by the Department at any given point of time. All we find is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rtment has also been dismissed and order of the CESTAT in Pitamber Coated Paper Ltd. case is confirmed. Therefore, there is no question of levy of penalty under provisions of Rule 12 of CENVAT Credit Rules, 2002 and recovery of duty paid by utilizing CENVAT from RG 23A Part-II, thereof under Section 11A of Central Excise Act, 1944 as alleged or at all. 10. Interestingly, instead of countering the submissions of the appellant and instead of highlighting any allegations in the SCN, on the issue of inadmissibility of credit, Commissioner observes that this response from the noticee only blandly refutes the allegation of SCNs but does not present any cogent legal argument in support of the contention that the noticee was eligible to take the credit and use it for the purpose for which it actually got used; on the other hand, the reply makes incorrect assertions; it is incorrect for the noticee to state that the SCNs have no alleged that the CENVAT has been incorrectly taken; the SCNs have made the point that the CENVAT has been incorrectly taken and utilized and have raised a demand under Sec 11A accordingly; the demands of incorrectly taken and utilized CENVAT made in the SCNs are lis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... otice cannot be sustained. We find that this Bench in the case of Shree Krishna Paper Mills and Industries Ltd. 2019 (365) ELT 594 (Tri. Chd.) held that: 8. Heard the parties at length and perused the record. We find that the facts of the case are that appellant were manufacturing paper and paper products. They were availing CENVAT credit on inputs clearing the final products on payment of duty. Appellant also closed their factory and surrendered their Central Excise registration. As there was certain CENVAT credit lying unutilized in their CENVAT account, they filed refund claim. The refund claim was sanctioned to the appellant on closure of the factory, relying on the decision of Slovak India Trading Company Pvt. Limited (supra). The dispute arose between the parties on the ground that the activity undertaken by the appellant does not amount to manufacture, therefore they are not entitled to avail CENVAT credit. Consequently, they are not entitled to refund claim. We find that, at no stage, it has been questioned to the appellant that for denial of CENVAT credit which are not entitled to them. Moreover, the Revenue collected the duty from the appellant, although the Revenue was o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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