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TMI Blog2024 (12) TMI 1360X X X X Extracts X X X X X X X X Extracts X X X X ..... sputed and therefore, credit is admissible. It is further found that relying on the decision of the Hon ble Supreme Court in the case of Mehra Brothers Vs Joint Commercial Officer [ 1990 (11) TMI 144 - SUPREME COURT] , learned Commissioner finds that the test as to verify whether an item is an accessory or part of the vehicle is whether the article or articles in question would be an adjunct or an accompaniment or an addition for the convenient use of another part of the vehicle or adds to the beauty, elegance or comfort for the use of the motor vehicle or as a supplementary or secondary to the main or primary importance and the other test may be whether a particular article or articles or parts can be said to be available for sale in an automobile market or shops or places of manufacture - the Commissioner applied this test and the provisions of the Rules and came to a conclusion that the items qualify to be parts or accessories . Scope of SCN - HELD THAT:- The learned Commissioner rightly finds that the impugned items are either parts or accessories and therefore, credit is admissible before 01.03.2011 or after 01.03.2011. Authorized Representative for the Revenue tried to explai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appeal is filed by the Revenue against the impugned order dated 21.12.2012 passed by the Commissioner of Central Excise, Delhi-III, Gurgaon. 2. Brief facts of the case are that M/s. Maruti Suzuki India Limited, Palam Gurgaon Road ('Gurgaon unit') and M/s Maruti Suzuki India Limited, IMT, Manesar, Gurgaon ('Manesar unit') (the Respondent) are engaged in the manufacture and clearance of Motor Vehicles and parts thereof falling under Chapter 87 of Central Excise Tariff Act, 1985; Internal Audit of the Respondent was conducted from 09.11.2009 to 14.11.2009 and on the basis of audit report, two Show Cause Notices one dated 25.08.2011,covering the period August 2006 to March 2011, seeking to deny credit Rs. 11,18,93,459 and another dated 30.04.2012, for the period April 2011 to March 2012, proposing to deny credit of Rs 6,49,40,448, were issued on the ground that the bought-out items do not qualify as inputs under Rule 2(k) of the Credit Rules, as they are stored at the gate only and no manufacturing activity is carried out on them; both the SCNs were adjudicated vide the common Impugned Order wherein the Learned Commissioner dropped the entire demand proposed in the SCNs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n under the Motor Vehicles Act, 1989 and the CENVAT Credit Rules. 4. Learned Counsel for the respondents submits that the CENVAT credit in respect of the Impugned goods has been allowed by the department to the Respondent, vide OIO dated 25.11.2013,for the period of April 2012 to March 2013, for which proceedings were initiated vide Show Cause Notice dated 25.08.2011, on the ground that the Impugned goods have been cleared along with the final product, whose value has already been included in the assessable value of the final product; for the subsequent period, the Respondent was allowed to take credit of the Impugned goods; no appeal has been filed by the Department against the said order; as the department accepted that order, the said order has attained finality; the department cannot take contrary stands in proceedings on the same issue, for the same assessee, as held in the following. CCE, Pune-IIVs SS Engineers 2023 (386) ELT 192 (S.C.) Rosmerta Technologies Ltd Vs CCE 2020TIOL-916- CESTAT-CHD affirmed by Supreme Court vide order dt. 10.07.2023 SRF Ltd Vs CCE ST 2021-TIOL-523CESTAT-DEL. Carrier Air Conditioning and Refrigeration Ltd Vs CCE, Delhi-lll, Excise Appeal No. 2929 o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t is not available on the items in dispute in the present matter, then the duty paid by the Respondent on these items has to be construed as reversal of credit on removal of the final products and Duty already paid has to be adjusted against the demand; it is not open for the department to take two separate stands on the same transaction. He relies on Siddhartha Tubes Ltd Vs Commissioner, 2006 (193) ELT 3 (SC.) Hical India Pvt. Ltd Vs CCE, Bangalore, 2020 (40) GSTL 465 (Tri.-Bang). Honda Motorcycles Scooter India P. Ltd Vs CCE, Delhi-III 2012 (282) ELT 533 (Tri. -Del.) affirmed by Hon'ble Punjab Haryana High Court in CCE, Delhi-III Honda Motorcycles Scooter India P Ltd, 2014 (303) ELT 193 (P H) Honda Motorcycle Scooter India P Ltd Vs CCE, Delhi-III, 2012 (286) ELT 110 (Tri. -Del.) affirmed by Hon'ble Punjab Haryana High Court 2014 (303) ELT A53 (P H) 7. Learned Counsel for the respondents submits that the demand raised vide Show Cause Notice dated 25.08.2011 is time barred; there has been no suppression by the Respondent as department disputed the credit on some items like set of two spare bulbs, warning triangle first aid kit vide SCN dated 23.09.2003, which was dropped vi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... required to be reversed. He takes us through the definitions of accessories and parts and submits that each item in question has to be separately examined as whether the same is an accessory or not, to qualify as input under the above definition prior to 1.3.2011; in case the same is an accessory, it qualifies as input when cleared along with the final product; item wise details submitted by the respondents, make it clear that certain items are parts of the final product of the respondents. He submits that the adjudicating authority dropped the proceedings initiated without passing the reasoned and speaking order; the Adjudicating Authority has discussed about the admissibility of CENVAT Credit on Warning Triangle, First Aid Kit, Spare Bulbs; Carpet Set, Wheel cover, Cigar Lighter, Car Radio Antenna, Fire extinguisher; Wheel cap, carpet, Mirror Assembly and held that CENVAT Credit on these items are admissible to the respondent and dropped the entire demand of Rs. 17,68,33,907, without discussing and giving any findings, as to whether these items could be termed as inputs, parts or accessories and are used in or in relation to the manufacture of the final products, in respect of re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Learned Authorized Representative for department submits that the cases relied upon by the respondent are not applicable to the facts of the impugned case. 13. In reply, learned Counsel for the respondents submits that the argument put forth by the Learned Authorized Representative referring to the invoices is beyond the Show Cause Notice, impugner order and the grounds of appeal. It is not open for the Learned Authorized Representative to establish a new case at this juncture. The grounds of appeal challenge the dropping of demand of Rs 2.10 Cr on particular items mentioned therein on the grounds that the adjudicating authority did not give any findings. 14. Heard both sides and perused the records of the case. Admissibility of CENVAT credit on certain bought out items purchased by the respondent and supplied along with the vehicles is the precise issue involved in this case. It is the case of the Department that the learned Commissioner, vide impugned order, has not given any specific findings on the nature of the items in dispute and their admissibility to CENVAT credit and to that extent, the order is not a speaking order; on the other hand, learned Counsel for the respondent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) for captive use; or (d) all goods used for providing any (output service); or (e) all capital goods which have a value up to ten thousand rupees per piece, but excludes - (A) light diesel oil, high speed diesel oil or motor spirit, commonly known as petrol; (B) any goods used for- (a) construction or execution of works contract of a building or a civil structure or a part thereof; or (b) laying of foundation or making of structures for support of capital goods, except for the provision of service portion in the execution of a works contract or construction service as listed under clause (b) of Section 66E of the Act; (C) capital goods, except when, - (i) used as parts or components in the manufacture of a final product; or (ii) the value of such capital goods is up to ten thousand rupees per piece; (D) motor vehicles; (E) any goods, such as food items, goods used in a guesthouse, residential colony, club or a recreation facility and clinical establishment, when such goods are used primarily for personal use or consumption of any employee; and (F) any goods which have no relationship whatsoever with the manufacture of a final product. Explanation. For the purpose of this clause, f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion is beyond the scope of the show cause notice and the grounds of appeal. Revenue s appeal is very clear that it is only on the grounds that learned Commissioner (Appeals) has not given any findings as to the impugned goods vis- -vis their admissibility to CENVAT credit. Therefore, we find that it is not open for the Revenue to set up a new case at this juncture. 18. We further find that the goods in question are Bolt, Screw, nut, Lock Washer, Washer, washer Clip; Manual (Audio), R/Con Audio, NS, Switch, Audio; Acc. Socket, Assy, Body Socket; Top Deck Assy; Frame Top Bow front, Cushion top Bow; Pipe Rear; Cover Spare Tyre; Set, ORVM MTG Screw and Spot Light, Tag Cup Holder. We find that learned Commissioner has discussed the items under two Headings i.e. Parts and Accessories ; he has discussed a few items and used the word etc . We find that learned Counsel for the respondent s argument in this regard that the use of the term etc amounts to indicate that the adjudicating authority has discussed the admissibility of all the items. Therefore, we find that no case has been made by the Revenue on the admissibility of these items to CENVAT credit. We find that this Bench in the case ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f our discussions as above, we find that inclusion or otherwise of the value of the accessories, on which CENVAT credit is availed, in the assessable value of the motor vehicles cleared by the respondents, is not the subject matter of the grounds of appeal. In view of the assertions by the adjudicating authority that such value of the accessories is included in the assessable value of the motor vehicles; the argument of the learned Authorized Representative does not succeed. As the Department has accepted the OIO dated 25.11.2013 and no proceedings have been initiated for further period, it is not open for the Department to dispute the admissibility in the impugned case. We find that Hon ble Apex Court in the case of S.S. Engineers (supra) held that: Having regard to the fact that for the subsequent period, the Department has taken a stand that the bought-out items are not entered in the factory and the Assessee has not claimed credit on them, there is no case for adding their value in the assessable value and hence no proceeding need be initiated in the form of a show cause notice, we find that for the previous period, in respect of which this appeal arises, the stand of the Depar ..... X X X X Extracts X X X X X X X X Extracts X X X X
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