TMI Blog2014 (11) TMI 706X X X X Extracts X X X X X X X X Extracts X X X X ..... sequent amendment, the benefit became available. What is required to be considered is whether the Tribunal is required to follow the decision in the case of Emcure Pharmaceuticals Ltd. or not. In my opinion, the ld. AR has not been able to make out a case on this issue. manner of taking CENVAT credit of inputs received from 100% EOU was complicated and contentious. That different views were being expressed on the issue, therefore, extended period cannot be invoked and there is no case for imposing penalties. It is observed from the case laws relied upon by the appellant that the issue of taking CENVAT credit on inputs received from 100% EOU under Notification No. 23/2003-CE and method of calculating admissible credit as per Rule 3(7) (a) formula was disputed, therefore, no intention to evade payment of duty can be attributed on the part of the appellant. Accordingly, it is held that extended period is not applicable to the present facts and circumstances of case. Accordingly, penalties can also not be imposed upon the appellant - Decided in favour of assessee. - E/84/2012 - A/11997/2014 - Dated:- 19-11-2014 - Mr. M.V. Ravindran and Mr. H.K. Thakur, JJ. For the Appellant : ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to exemption Notification No. 23/2003-CE dated 31.3.2013. That except for a cenvat credit of ₹ 3,91,212/-, the entire credit is admissible to the appellant. It was also argued that as the admissibility of the credit under Rule 3(7) (a) of the Cenvat Credit Rules, 2004 was under litigation, therefore, extended period is not applicable in the present proceedings and no penalties are imposable. 3. Shri K. Sivakumar (AR) appearing on behalf of the Revenue argued that CENVAT credit of Education Cess and SHE Cess was not admissible before 07.9.2009 when second proviso to Rule 3(7) (a) was added to the Cenvat Credit Rules, 2004. That if the unamended provision was sufficient then there was no need for making an amendment with effect from 07.9.2009. Regarding the calculation of admissible CENVAT credit as per formula prescribed under Rule 3(7) (a), it was argued that CVD mentioned in this Rule means only the basic excise duty and will not include the cesses paid on the invoices. Learned AR thus strongly defended the order passed by the Adjudicating authority. 4. Heard both sides and perused the case records. The issue involved in the present appeal is as to what will be the ad ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... presentative copies of the invoices produced both by the appellant and the Revenue that in some invoices duty is paid under Sr. No. 1 table to of Notification 23/2003-CE. On these invoices where duty is paid under Sr. No.1 of table to Notification 23/2003-CE entire credit of CVD, including cesses will thus be admissible to the appellant. 4.1 Regarding admissibility of CENVAT credit on Education Cess and Secondary Higher Education Cess for the period prior to 07.9.2009 the following view was taken held by this bench in the case of CCE Daman vs. PVN Fabrics (supra):- 5. As can be seen? from the Rule, the second proviso providing credit of the full amount of CENVAT Credit of Excise duty paid in respect of clearances made under Notification No. 23/2003-C.E., dated 31.3.2003 and also allowing the full education cess paid was introduced with effect from 07.9.2009 and at the time when the Tribunal considered the issue in the case of Emcure Pharmaceuticals Ltd., this proviso was not there. It was the ld. AR s submission that the fact that legislature chose to introduce a proviso and specifically provide for credit of education cess paid shows that the CENVAT Credit of ed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t into account to see its correctness and not taking the amendment made subsequently into consideration to consider previous decision. 7. I find myself in agreement with the submissions made by ld. Counsel for the respondents. Since the amended provisions of the rules were not there, it cannot be said that the decision in the case of Emcure Pharmaceuticals Ltd. is per incurium because in the light of subsequent amendment, the benefit became available. What is required to be considered is whether the Tribunal is required to follow the decision in the case of Emcure Pharmaceuticals Ltd. or not. In my opinion, the ld. AR has not been able to make out a case on this issue. The decision of the Tribunal in the case of Madura Coats Ltd., the issue before the Tribunal was whether the Notification No. 28/2001-C.E. which was issued after long time after issue of Notification No. 82/92-C.E., expanding the benefit can be said to have retrospective effect. A view was taken that substantive right which was subsequently created, cannot be said to be clarificatory in nature to have a retrospective effect. In this case, that is not the issue before me. Even before the amendment was introduced, t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... credit of Cesses was admissible before the amendment also. So far as calculation of admissible CENVAT credit, as per formula prescribed under Rule 3(7)(a) of the Cenvat Credit Rules, 2004 is concerned, appellant argued that elements of Education Cess and SHE Cess has to be considered as a part of CVD only. Appellant has relied upon the case laws of Shri Venketeshvara Precision Components vs. CCE Chennai (supra) and CCE Chennai vs. Jumbo Bags Limited (supra). In view of these case laws relied upon by the appellant this issue is no more res-integra as per Para 6 of the case law CCE Chennai vs. Jumbo Bags Limited (supra):- 6. As regards the cases where the duty has been paid by the suppliers availing exemption under Sr. No. 2 of the Table under Notification No. 23/2003-C.E., dated 31-3-2003, the restriction under the proviso to Rule 3(7) of the Cenvat Credit Rules, 2004 comes into play as the period involved in this case is between June, 2007 to December, 2008. As has been argued by the learned advocate, there is no dispute that the restriction placed under sub-rule 7(3) is intended to prohibit a manufacturer from taking credit of that portion of the duty which is equiv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he period 01.3.2008 to 31.7.2008 the duty on inputs received was reduced from 16% to 14% as per budget 2008-09 where as they calculated admissible credit by taking duty at the rate of 16%. That the above wrong calculation lead to excess credit of ₹ 3,91,212/- and that any demand beyond ₹ 3,91,212/- is not maintainable. In view of the above submission demand of ₹ 3,91,212/- is required to be paid by the appellant along with interest. 6. Appellant has also argued that the manner of taking CENVAT credit of inputs received from 100% EOU was complicated and contentious. That different views were being expressed on the issue, therefore, extended period cannot be invoked and there is no case for imposing penalties. It is observed from the case laws relied upon by the appellant that the issue of taking CENVAT credit on inputs received from 100% EOU under Notification No. 23/2003-CE and method of calculating admissible credit as per Rule 3(7) (a) formula was disputed, therefore, no intention to evade payment of duty can be attributed on the part of the appellant. Accordingly, it is held that extended period is not applicable to the present facts and circumstances of cas ..... X X X X Extracts X X X X X X X X Extracts X X X X
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