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Central Excise - Case Laws
Showing 61 to 80 of 88 Records
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2022 (8) TMI 495 - CESTAT ALLAHABAD
Absolute Confiscation - cash seized from the residential premise of Director of M/s PML and from the residence of alleged broker/agent for cenvatable invoices - levy of penalty u/r 26 of the Central Excise Rules 2004 invoking the provision of Section 121 of the Customs Act, 1962 - HELD THAT:- The application of Rule is inescapably linked to dealing in goods where the concerned person should have reasons to believe that the same are liable for confiscation. In this case, it is found that the main allegation of the Department is that the respondents M/s PML have availed CENVAT credit only on the basis of forged/doctored documents like invoices without purchasing, receiving or utilizing the material in the manufacture of their final product i.e. ‘steel rolling machine’. There is certain contradiction in the approach of the Department. On the one hand the Department’s allegation is that there is no movement of goods and on the other hand seeks to impose penalty on the appellants for dealing with goods in an illegal manner - Such logic is not acceptable. The provisions of Rule 26 have not been satisfied to impose penalties.
The learned Adjudicating Authority has found that the respondents herein have duly accounted for the cash seized from their premises and as they have not dealt in any manner with the goods that can be held liable for confiscation, no penalty is imposable on them.
When two authorities of the Department i.e. the Adjudicating Authority as well as the Appellate Authority have given categorical findings against the allegations made in the show cause notice giving cogent reasons, the Department is attempting to take the issue back to the beginning by filing these appeals. The Department has not made any case for confiscation of cash seized from the premises of Shri Gurmeet Singh and Shri Preet Singh regarding seizure of case of Rs.17 lakh.
The Adjudicating Authority as well as the Appellate Authority have convincingly rejected the contention made in the show cause notice and therefore, there are no reasons as to why the impugned order needs to be interfered with - Appeal dismissed - decided against Revenue.
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2022 (8) TMI 494 - CESTAT KOLKATA
Clandestine Removal - shortages of finished goods vis-à-vis stock recorded in the Daily Stock Account - retraction of statements - prescriptions of Section 9D of the Act, not adhered - levy of personal penalties - HELD THAT:- The Commissioner had erred by holding that the retractions were belated, did not inspire confidence of bona fides and that the claim of retraction was after-thought under legal advice. The Commissioner had also erred by relying upon a host of judicial decisions without discussing their individual factual situations, as is apparent from a bare perusal of paragraph no. 8.4 at pages 15-17 of the impugned order, and the said findings in this behalf are liable to be held as untenable. On a query from this Bench, the Ld.Advocate submitted that necessary averments as to the retraction of the aforesaid purported statements had been made in the replies to the show cause notices and other communications of the appellants/noticees - the adjudicating authority would not have reached a different conclusion in this regard, had the retractions been produced before him by the co-appellants/ deponents concerned. In any case, the inherent contradictions and discrepancies in the statements given by each co-appellant/ noticee, as elaborated in page nos. 11-13 of the Company’s Written Submissions, militate against the evidentiary value attached to the purported incriminating statements, even if the original statements were to be held as admissible.
Failure on part of the adjudicating authority to adhere to prescriptions of Section 9D of the Act - HELD THAT:- Section 9D(1) of the Act sets out the circumstances in which a statement made and signed before a Gazetted Central Excise officer shall be relevant for the purpose of proving the truth of the facts contained therein. If these circumstances are absent, the truth of the facts contained in the statement made during the course of enquiry/investigations before a Gazetted Central Excise officer, has to be proved by evidence other than the statement itself - the adjudicating authority could not have straightaway relied on the purported incriminating statements of Sri Sanjib Mahapatra, Sri Prahraj Swain and Sri Sanjay Gadodia aforesaid (assuming that the subsequent retractions were invalid) without legitimately invoking Section 9D(1)(a) of the Act. All the said purported statements, thus, have to be eschewed from consideration.
Levy of personal penalties - HELD THAT:- As the principal demands against the Company have failed, the imposition of personal penalties against Sri Sanjay Gadodia, Sri Sanjib Mahapatra and Sri Prahraj Swain aforesaid cannot be sustained.
Appeal allowed - decided in favor of appellant.
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2022 (8) TMI 493 - CESTAT NEW DELHI
Valuation - transaction value under section 4 (1) (a) of the Central Excise Act, 1944 - collection of some charges in the name of the Cylinder Holding Charges [CHC] from its customers if the customers do not return the re-usable cylinders within a specified period - inclusion in the assessable value or not - HELD THAT:- The appellant are not liable to pay central excise duty on the rental charges, as has been decided in its own case by the Tribunal in M/S LINDE INDIA LIMITED VERSUS COMMISSIONER OF CENTRAL EXCISE [2018 (12) TMI 1954 - CESTAT NEW DELHI] where it was held that similar issue came up before the Tribunal in the case of BOC INDIA LIMITED VERSUS COMMISSIONER OF CENTRAL EXCISE, CHENNAI-I [2004 (1) TMI 246 - CESTAT, KOLKATA] wherein it was held that the said charges are not, in any way, related to or connected with the sale of the Gases. As such, the same cannot be said to be includible in the definition of the “transaction value‟, as is appearing in the provisions of Section 4(3)(d).
Additional Consideration for sale or not - HELD THAT:- The appellant is not charging CHC as a condition for sale of its gases. In fact, any customer can buy the gas without paying the CHC and return the cylinder within the time and in such a case no CHC will be payable by the customer to the appellant. If the customer delays returning the cylinder the appellant recovers CHC from the customer in the form of a penalty for delayed return of the cylinder. Central excise duty should be charged on the value of gas for delivery at time and place of removal i.e. at the factory gate. This price does not include the CHC. The CHC is charged only if, after delivery, the customer does not return the cylinder in time. Therefore, it cannot be called an additional consideration for sale but can only be a penalty for not returning the cylinder within time after the sale is completed.
Thus, the CHC is not includable in the assessable value - appeal allowed - decided in favor of appellant.
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2022 (8) TMI 492 - CESTAT KOLKATA
Reversal of CENVAT Credit - Appellant has used common inputs for manufacture of dutiable goods as well as exempted goods - requirement to pay 8%/10% of the value of the exempted goods i.e. medical oxygen - extended period of limitation - HELD THAT:- The entire case has been made out by the Department on the basis of ER-1 returns. There is no allegation in the show cause notice that the Department was not aware about the manufacturing activity of the Appellant i.e. Industrial Oxygen and Medical Oxygen. It is further observed that apart from the general aversion in the show cause notice, there is no evidence to show that central excise duty has not been paid by resorting to fraud or suppression of facts with an intent to evade payment of duty.
It is well settled law that onus is on the Department to prove that extended period of limitation is invokable by adducing evidence. In the present case, no such evidence has been adduced by the Department.
As far as demand for the normal period is concerned, it is found that the Appellant has reversed the proportionate cenvat credit which has been availed in the manufacture of exempted goods - Hon’ble Supreme Court in the case of CHANDRAPUR MAGNET WIRES (P) LTD. VERSUS COLLECTOR OF C. EXCISE, NAGPUR [1995 (12) TMI 72 - SUPREME COURT] has held that the claim for exemption of duty on the disputed goods cannot be denied on the plea that the assessee has taken credit of the duty paid on the inputs used in manufacture of these goods.
The impugned Order is not sustainable and the same is set aside - Appeal allowed - decided in favor of appellant.
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2022 (8) TMI 491 - CESTAT KOLKATA
Lesser sanction of refund claim and non-payment of interest - quantum of refund reduced - amendment to N/N. 20/2007 by N/N. 20/2008 and 38/2008 - HELD THAT:- The department was required to sanction the amount as claimed in the original refund application, which was rejected by the original authority, but the Appeal of the Appellant was ultimately allowed by the Tribunal. The department is directed to refund the amount, as claimed in the original refund application filed by the respective Appellants.
As regards interest, It is found that it is not the case here that the Appellants sought refund and/or filed refund applications after passing of the Tribunal’s order since originally the refund claim itself was under challenge before the refund sanctioning authority.
The Appellants are entitled to interest after 3(three) months from the date of filing of the original refund claim till the sanction of the refund amount - Appeal allowed - decided in favor of appellant.
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2022 (8) TMI 469 - CESTAT KOLKATA
CENVAT Credit - GTA Services - place of removal - requirement of ISD registration - case of department is that the GTA credit could be availed only upto the place of removal and not from place of removal, the Head Office could not distribute credit without having ISD registration, the credit was to be proportionately distributed to all the units - extended period of limitation - Admissibility of credit on GTA services upto 1.4.2008 - HELD THAT:- The issue is no more res integra on merits itself in the light of judgment of Hon’ble Supreme Court in the case of COMMISSIONER OF CENTRAL EXCISE SERVICE TAX VERSUS ULTRA TECH CEMENT LTD. [2018 (2) TMI 117 - SUPREME COURT] where it was held that Cenvat Credit on goods transport agency service availed for transport of goods from place of removal to buyer’s premises was not admissible to the respondent - Therefore, following the same, it is held that the credit on GTA services from the place of removal upto 1.4.2008 was rightly admissible to the Appellant.
Issue of distribution of credit prior to 1.4.2016 - HELD THAT:- Rule 7 of CCR provided mechanism to distribute the credit and it was only after amendment made in 2016, the condition for proportionate distribution was inserted. This issue has also been settled by the Tribunal in the case of PIRAMAL GLASS PVT LTD VERSUS C.C.E. & S.T. -SURAT-I [2021 (9) TMI 1198 - CESTAT AHMEDABAD]) that prior to 1.4.2016 there was no need to proportionately distribute credit to all the units. Therefore, the credit was rightly distributed to the appellant by its Head Office during the period in dispute.
Distribution of credit by the Head Office without obtaining ISD registration - HELD THAT:- The issue involved being of general in nature, the law has already been settled by the Hon’ble Gujarat High Court in COMMISSIONER OF CENTRAL EXCISE VERSUS DASHION LTD [2016 (2) TMI 183 - GUJARAT HIGH COURT] where it was held that credit cannot be denied on the basis of non-registration of Head Office as ISD - the impugned order denying credit on the basis of non- registration of Head Office as ISD is not sustainable.
Extended period of limitation - HELD THAT:- Since the appeals are allowed on merits itself, there otherwise remains no need to look into the issue of limitation.
Appeal allowed - decided in favor of appellant.
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2022 (8) TMI 468 - CESTAT KOLKATA
CENVAT Credit - Works Contract Services - Input Services - Department took the view that the services provided by the contractors were in the nature of ‘works contract services’ which, was excluded from the definition of input service under the Cenvat Credit Rules, 2004 - period from 01-04-2011 to July, 2015 - HELD THAT:- The definition of ‘ínput service’ has an inclusion clause and an exclusion clause. The intention of the government could never have been to cover certain services in the inclusion part and at the same time cover them also in the exclusion clause. The cases cited by the learned advocate for the appellants support this view. The expression “modernisation, renovation or repairs of a factory” was appearing in the definition of ‘input service’ both before and after 01.07.2012. It has not been denied by the department that the Coke Oven Project of the appellants was towards modernization and renovation of their existing plant/factory.
In the case of RELIANCE INDUSTRIES LTD. VERSUS C.C.E. & S.T. -RAJKOT [2022 (4) TMI 729 - CESTAT AHMEDABAD], the facts were similar to that of the present case where the party had undertaken modernization and expansion of their facility, where it was held that The service provider has classified the services under ECIS and not under Construction Service and paid service tax under the head of ECIS. The ECIS Service independently not covered under the exclusion clause therefore, for this reason also credit cannot be denied. There is a catena of case laws wherein, it was held that the classification of service cannot be disturbed or challenged at the end of service recipient particularly for denial of cenvat credit. Once the classification is finalized at the service provider end, the same cannot be altered at the service recipient end.
The Appellants have correctly taken credit of service tax paid/borne in respect of all services which were used for the Coke Oven Project as part of the modernization/renovation plan of the existing plant/factory - Appeal allowed - decided in favor of appellant.
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2022 (8) TMI 467 - CESTAT NEW DELHI
Captive Consumption - intermediary goods - manufacture of coir mattresses and intermediate products, namely, PU Foam and PU Foam SST - PU Foam by the appellant without payment of duty - N/N. 67/1995-CE dated 16th March, 1995 - separate account in the name and style as “captive use” has been maintained by the appellant in their ER-returns - demand of duty alongwith penalty - HELD THAT:- Keeping in view that the ER returns and the figures mentioned therein have to be meticulously examined specifically the figures of the column of “captive use” are concerned to recalculate the ratio of material consumed and final product cleared. Apparently, these figures included the captive use of PU Foam & PU SST.
The original adjudicating authority is, therefore, required to look into the documents on record, to consider the re-conciliation chart, if any, filed by the appellants so as to calculate the quantity of PU Form/ PU Foam SST as have been captively used and that amount thereof in the final product cleared, and to decide the case afresh independent of the decisions already on record.
The present appeal hereby is allowed by way of remand.
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2022 (8) TMI 411 - CESTAT AHMEDABAD
Utilization of Cenvat credit of Basic Excise duty for payment of Education Cess and Higher Education Cess - benefit of N/N. 39/2001-CE. availed - HELD THAT:- This Tribunal has already taken a view that assessee is entitled to utilize the Cenvat credit of basic excise duty for payment of Education Cess and Higher Education Cess while availing Notification No. 39/2001-CE. Therefore, the issue is no more res-integra.
This Tribunal, in the case of M/S. GALLANTT METAL LTD VERSUS C.C.E. & S. T-RAJKOT [2019 (11) TMI 1742 - CESTAT AHMEDABAD] and in the case of M/S. ASR MULTIMETALS PVT LTD. AND GALLANTT METAL LTD VERSUS C.C.E. & S.T. -RAJKOT [2019 (7) TMI 1937 - CESTAT AHMEDABAD] has held that the appellant are entitled for utilization of credit of basic excise duty for payment of Education Cess and Secondary & Higher Education Cess.
Thus, the appellant is entitled for utilization of Cenvat credit of basic excise duty for payment of Education Cess and Secondary and Higher Education Cess - appeal allowed - decided in favor of appellant.
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2022 (8) TMI 313 - SC ORDER
Clandestine removal - undervaluation of Silico Manganese - charges merely on the basis of entries in private diary without other corroborative evidence of flow back of fund etc. - HELD THAT:- We decline to interfere in this appeal being devoid of merits. The appeal is accordingly dismissed.
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2022 (8) TMI 312 - SC ORDER
Maintainability of appeal - HELD THAT:- There are no reason to deviate from the concurrent view taken including by the Appellate Tribunal.
The civil appeal is dismissed.
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2022 (8) TMI 311 - RAJASTHAN HIGH COURT
100% EOU - de-bonding - refund of the excise duty previously paid - main focus of the revisional authority was that the EOU unit and the DTA unit were not the same entity, for which purpose, the authority referred to the central excise registration numbers - HELD THAT:- Shorn of legal technicalities what emerges is that the petitioner as a 100% EOU would have made purchases of raw material and inputs from the local market without payment of excise duty as well as not born duty on final product manufactured by it on a promise that the final product would be eventually exported. When it showed the desire to convert itself from 100% EOU to DTA, as per requirement of law, it had to pay up the excise duty on such purchases and final product where duty was previously not collected. Admittedly, such duty was paid at the time of what is referred to de-bonding. However, this would not prevent the exporter from claiming refund of excise duty if the goods are eventually exported. The petitioner as a DTA unit exported the goods and claimed refund of excise duty previously paid in its capacity as an EOU.
There is no procedure in law to deprive the petitioner from such benefit. The appellate authority has correctly discussed the legal position. The revisional authority has committed error in reversing the said order.
Petition allowed.
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2022 (8) TMI 310 - CESTAT MUMBAI
Refund claim of unutilised CENVAT Credit - exports as per provision contained in Rule 5 of the CENVAT Credit Rules, 2004 vis. a vis. Notification No. 27/2012-CX (NT) dated 18.06.2012 - grant of cash relief against pre-GST CENVAT Credits - Section 142 of the CGST Act - as per the notification claimant to take back the credit of the difference between the amount claimed and amount sanctioned - HELD THAT:- It is a fact that sub-para (i) of Para-2 of Notification No. 27/2012-CX (NT) permits the claimant to take back the credit of the difference between the amount claimed and amount sanctioned. Here amount sanctioned being zero, the entire credit could have been taken back by the Appellant but such an action can only be initiated upon completion of the entire adjudication and appeal process or by way of its abandonment or else in the event of taking a re-credit, if Appellant Authority allows the refund, it would amount to acceptance of dual benefits in taking advantage of improper wordings in the notification that remained silent as to at what stage the claimant can re-credit the amount back to its account. Such a long waiting by the Appellant in not venturing into such an unethical practice exhibits the bonafideness of a law abiding national. More importantly, going by Section 11 of the CPC if any relief is sought from the Court of Law and it is not expressly granted, it is deemed to have been refused.
The Appellant is entitled to get cash refund with applicable interest, if any, against CENVAT Credit available to its credit during pre GST regime as per provision contained in Section 142(3) of the CGST Act.
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2022 (8) TMI 229 - SC ORDER
Maintainability of appeal - monetary amount involved in the appeal - Interpretation and validity of Rule 8(3A) of the Central Excise Rules, 2002 - HELD THAT:- The Revenue should not have preferred the petition for special leave to appeal keeping in view the meager amount involved. In fact, the administrative expenses etc. may well be much higher than the tax involved.
The petition for special leave to appeal is dismissed.
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2022 (8) TMI 228 - CESTAT KOLKATA
CENVAT Credit availed by the appellant company on capital goods - credit has been availed on the strength of excise invoices issued by the manufacturer (OEM) of equipment - invocation of extended period of limitation - HELD THAT:- The Ld. Commissioner in para no. 79 to 81 has arrived at the conclusion that though the entire work for construction of power plant (CPP) is a turnkey contract on EPC basis, the work orders have been segregated to split into supply of goods and works & services for their mutual convenience to enable the contractor to claim deduction of value of goods for arriving at value of taxable services for charging service tax. It is found that by making the above observation, the Ld. Commissioner has not conclusively drawn any inference to state whether there is any embargo to avail Cenvat Credit on capital goods, more so ever when there is no dispute with regard to availment of credit on input service in the hands of the appellant.
The Ld. Commissioner made a fundamental error while observing that payments have not been made to the original supplier (OEMs) but to the Contractor against the separate set of commercial invoices - In any case, whether or not the payment has been made against the excise invoices issued by the OEM or the commercial invoice issued by the Contractor who has procured the goods on behalf of the Appellant for use in the power plant is completely irrelevant. The Ld. Commissioner has thus made a fundamental error while taking into consideration the above payment related aspect while deciding the eligibility to avail credit on capital goods.
Extended period of limitation - HELD THAT:- There are no positive evidence to show that there was any fraud or willful suppression inasmuch as the availment of credit has been duly shown in the monthly returns and credit entries have been duly recorded in the Credit Register which form part of the Annexure to SCN. Thus, there are no ingredient to justify invocation of extended period of limitation and therefore, the impugned proceedings are also barred by limitation.
The order cannot be sustained and is therefore set aside - Penalty also set aside - appeal allowed - decided in favor of appellant.
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2022 (8) TMI 227 - CESTAT NEW DELHI
Clandestine removal - MS Ingots - corroborative evidences or not - whole case of Revenue is based on third party record as well as statement of the Director of M/s PIL - HELD THAT:- There is no corroboration of the allegation of Revenue with the record of this appellant. Nor there is any admission of the alleged clandestine transaction on the part of the appellant. Further, the third party record are not corroborated and unsubstantiated. Further, such third party record and the statement of the Director of M/s PIL cannot be used against this appellant both for non joinder of the parties and also failure on the part of Revenue to examine Sh. Pankaj Agarwal as its witness in the adjudication proceedings.
Appeal allowed - decided in favor of appellant.
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2022 (8) TMI 226 - CESTAT NEW DELHI
Benefit of Exemption Notification - On receipt of certain amounts for tools/dyes as well as for manufacture of motor vehicle parts, it was observed that the said motor vehicle parts have been cleared to M/s. Force Motors Ltd. without payment of Central Excise duty - Whether the appellant is liable to pay Excise duty on the impugned tools/dyes and that benefit of Notification No. 67/95-CE dated 16.03.1995 is not available to the appellant? - reversal of CENVAT credit - interest and penalty - HELD THAT:- Apparently and admittedly, the tools/dyes were not cleared by the appellant despite being manufactured by it and the duty liability has been denied claiming the benefit of exemption Notification No. 67/95 –CE dated 16.03.1995.
As observed from the Notification, the same is absolutely silent about the sale of manufactured goods to be a criteria for non applicability of said Notification. It only says that the goods to seek exemption should be the goods manufactured by the assessee and should have been retained by the assessee for further manufacture. Customized manufacture is also not the criteria for non-applicability of said Notification. Thus it is clear that the ground raised by the department supporting the order under challenge is not sustainable for denying the benefit of aforesaid Notification to the appellant. Further, there is no evidence by the department to show that the said goods were never captively consumed by the appellant - There is no denial to the fact the goods retained were used for further manufacture. This observation is sufficient to hold that the tools/dyes were kept with the appellant for the purpose of manufacturing motor vehicle parts in future also though only for M/s. Force Motors Ltd.
The appellant has challenged the findings on the ground that the cost received by the appellant towards the manufacture of tools/dyes has been amortized by the appellant and for the said reason also appellant is not liable to discharge any duty of excise thereupon. It is observed that the Adjudicating Authority below has not considered the said contention for want of evidence in the form of certificate of Chartered Engineer - Apparently and admittedly, the same is not the fact of the present case. Further the manufacturer therein has not amortized the cost of tools/dyes manufactured by him rather it included the said cost in the cost of components manufactured out of said tools/dyes. Apparently and admittedly this also is not the fact of the present case. That in the purchase order, the amount of cost of tools/dyes (moulds manufactured by the appellant) included in the cost of tools manufactured by the appellant out of said moulds but the tax invoices are revealing appropriate amortization of the cost of said moulds.
Appeal allowed - decided in favor of appellant.
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2022 (8) TMI 225 - CESTAT AHMEDABAD
CENVAT Credit - CVD paid through Challan - non-fulfilment of export obligation - case of the department is that the challan is not a proper document in terms of Rule 9 of CCR, 2004 - whether the appellant is entitled for the cenvat credit on the strength of challan whereby the CVD was paid subsequent to the import of goods? - HELD THAT:- The very same issue has been considered by this Tribunal in the case of HUBERGROUP INDIA PVT LTD VERSUS C.C.E. & S.T. -DAMAN [2021 (11) TMI 945 - CESTAT AHMEDABAD] where it was held that in the instance case the original duty paying document is bill of entry and the challans are the documents on the strength of which additional duty has been paid. Thus, even going by the logic given by the Commissioner in the impugned order there is no bar on availing credit on the strength of challans. Thus, we find no merit in this argument of the Commissioner in the impugned order.
The issue is no longer res integra - Appeal allowed - decided in favor of appellant.
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2022 (8) TMI 164 - SC ORDER
Mode of refund - Rebate / refund to be made in Cash or to be re-credited into Cenvat Credit account - petitioner paid lesser duty on the domestic product and higher duty on the export product which was admittedly not payable - HELD THAT:- the case involves the factual aspects. - Section 140 and Section 142 of the Central Goods and Services Tax Act, 2017 are not examined and no comment have been made whether or not the appellant(s) assessees would be entitled to benefit under the said Sections.
No question of law arises for consideration, and hence, the appeals are dismissed.
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2022 (8) TMI 163 - CESTAT AHMEDABAD
Process amounting to manufacture or not - conversion of waste oil/used oil/sludge obtained from various sources into reclaimed fuel oil / re-refining used oil amounts - classifiable under Central Excise Tariff Sub-heading No. 27101990 or classifiable under Chapter heading 27109900 as claimed by the Appellant? - Time Limitation - suppression of facts or not - HELD THAT:- The basic fact that is not disputed is that the Appellant purchasing waste/ sludge oil from vessels and other sources. This is sold as waste oil/sludge oil and is purchased by the appellant also as waste oil /sludge oil. For removing impurities from said waste oil Appellant undertake various processes. The processing undertaken by the appellant is inform of filtering distillation, dehydration, centrifuging etc. The entire tenor of the Adjudicating Authority while confirming the demands is only on the ground that the used oil which was unfit for use as fuel Oil were made fit for use by the appellant by refining or reprocessing the same and hence, characteristic and the use has changed. Due to which Chapter Note No. 4 of Chapter 27 gets attracted and the said activity becomes manufacture. It is observed that the purifying of the sludge/used oil would not amount to manufacture. Manufacture implies a change, but every change is not manufacture.
The Apex Court in the landmark decision in the case of UNION OF INDIA VERSUS DELHI CLOTH AND GENERAL MILLS CO. LTD. [1962 (10) TMI 1 - SUPREME COURT], held that “The word ‘manufacture’ used as a verb is generally understood to mean as ‘bringing into existence a new substance,’ however, minor in consequence the change may be.” The true test for determining whether manufacture can be said to have taken place is whether the commodity which is subjected to the process of manufacture can no longer be regarded as the original commodity but is recognized in trade as a new and distinct commodity. In the present case, the appellant bring used waste oil /sludge oil and by removing impurities, it is made again useable as oil. Both before and after the processing, the product remains as only oil. That being so, it cannot be said that a new and distinct commodity has come into existence consequent to the process undertaken by the appellant.
From Circular dated 11-4-2016, it can be held that the process of cleaning of waste oil to yield reclaimed fuel oil does not amount to manufacture as defined under Section 2(f) of the Central Excise Act, 1944. Once it is held that the activity is not manufacture all he demands including duty, interest, penalties and personal penalty in the impugned shall not sustain on merit.
Extended period of Limitation - suppression of facts or not - HELD THAT:- The department was aware of the Appellant’s activity in respect of Waste Oil/ Sludge/Used Oil. The Appellant have not suppressed anything from the department. It is also noticed that CBEC vide circular No. 1024/12/2006-CX dated 11.04.2006 also instructed that “ the issue is interpretational in nature and therefore where a demand is raised pursuant to this circular, it should be raised for normal period of limitation only. SSI benefit, where admissible, should be extended”. Therefore, in this fact the demand confirmed by the Ld. Commissioner invoking the extended period legally not sustainable and the same is set aside on limitation too.
Appeal allowed - decided in favor of appellant.
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