2019 (10) TMI 958 - HC - Central Excise

Scope of impugned order - CENVAT Credit - common input used in exempt goods - Furnace Oil which was used for generation of steam supplied to its sister concern - HELD THAT - It is an agreed position between the parties that the impugned order dated 26th July 2018 of the Additional Commissioner goes beyond the remand order dated 17th July 2015 of the Tribunal. This in view of the fact that it re-adjudicates the issue afresh on merits when the remand order was only to decide the quantum final product cleared by the sister concern on payment of excise duty to determine the CENVAT Credit available. Impugned order set aside - the issue of determining the quantification of CENVAT Credit available to the Petitioner is restored to the Respondent No.2 Additional Commissioner for fresh determination - petition disposed off.

Summary

Issues:
Challenge to order under Section 11A of the Central Excise Act, 1944 for CENVAT Credit entitlement.

Analysis:
The judgment pertains to a petition challenging an order passed by the Additional Commissioner, Central GST Commissionerate, demanding CENVAT Credit of Rs. 21.85 lakhs for duty paid on Furnace Oil used for generating steam supplied to a sister concern. The impugned order was based on the belief that the petitioner was not entitled to the CENVAT Credit for this specific usage. The order in question was a result of a previous order by the Customs, Excise & Service Tax Appellate Tribunal, which had allowed the petitioner to claim CENVAT Credit for the duty paid on Furnace Oil used for steam generation. However, the Tribunal's order had remanded the issue of determining the final products cleared by the sister concern on payment of duty to ascertain the extent of CENVAT Credit available.

The parties agreed that the impugned order went beyond the Tribunal's remand order by re-adjudicating the issue on merits instead of focusing solely on quantifying the CENVAT Credit available. Consequently, the High Court found that the impugned order was contrary to the Tribunal's directions and set it aside. The High Court ruled that the issue of determining the CENVAT Credit available to the petitioner should be reconsidered by the Additional Commissioner in accordance with the Tribunal's order from 17th July, 2015. The petition was disposed of with this direction for fresh determination of the CENVAT Credit entitlement.