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Central Excise - Case Laws

Showing 41 to 60 of 956 Records

• 2022 (12) TMI 767 - CESTAT AHMEDABAD
  

  Levy of penalty u/r 26 (1) of Central Excise Rules, 2002 - case of the department is that the Urea was diverted and used for industrial purpose - demand of differential duty in the chain from manufacture up to the consumer - cross-examination done properly or not - HELD THAT:- The crossexamination of the witnesses was not carried out properly. The Hon’ble High Court in two identical cases of GUJARAT NARMADA VALLEY FERTILIZERS AND CHEMICALS LTD [2020 (1) TMI 1204 - GUJARAT HIGH COURT] and VIJAY CHANDRAKANT MULCHANDANI VERSUS UNION OF INDIA & 2 [2017 (11) TMI 2011 - GUJARAT HIGH COURT], considering the fact that no cross-examination was allowed but the same is necessary for passing a reasoned order by the adjudicating authority, directed the adjudicating authority to conduct the cross examination.

  This Tribunal in also one set of cases on identical issue in the case of Dhanlaxmi Pigments Pvt. Ltd and others vide Final Order No. A/11258-11368/2019 dated 08.07.2019 [2019 (9) TMI 1163 - CESTAT AHMEDABAD] remanded the matter to the adjudicating authority.

  Thus, all these appeals should also be remanded to the adjudicating authority for passing a fresh order, after conducting the cross-examination of the witnesses - appeals are disposed of by way of remand to the adjudicating authority for passing a fresh order after complying the provision to Section 9D of Central Excise Act, 1944.

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• 2022 (12) TMI 721 - CESTAT AHMEDABAD
  

  CENVAT Credit - import of capital goods cleared under N/N. 54/2003-Cus. dated 01.04.2003 by debiting the countervailing duty (CVD) amounting to Rs. 18,37,92,521/- - amount of CVD paid as debit in Served From India Scheme (SFIS) - HELD THAT:- It is undisputed that as per Rule 3 of the Cenvat Credit Rules, any duty paid under Section 3 of the Customs Tariff Act is eligible to an assessee as Cenvat credit. It is also undisputed that the appellant in this case has paid the CVD by a debit in the SFIS. Appellant had imported capital goods under Notification No. 54/2003-Cus dated 01.04.2003 and Notification No. 94/2004-Cus dated 11.09.2004. These imports took place in 2005, 2006 and 2007. During the period 2004-05 to 2006-07. In the Foreign Trade Policy there is specific provision to allow Cenvat Credit in respect of scheme like VKGUY, Target Plus, Focus Products Scheme but no such provisions was made for SFIS and during the period from 2007-08 onwards, a general provisions at para 3.12.1 (2007-08 to 2008-09) and para 3.17.6 (2009-10 onwards) was made.

  During the relevant disputed period, in the Foreign Trade Policy, there was neither an express provision to allow Cenvat credit of the CVD paid through debit in the SFIS scrip nor to disallow the Cenvat Credit of the CVD paid through SFIS. In such situation, admissibility of Cenvat Credit should be decided as per the provisions of Cenvat Credit Rules 2004, applicable during the relevant period. Cenvat Credit Scheme is a special scheme where an assessee can avail credit of the duty paid on the inputs /capital goods/ input services as CENVAT credit under certain conditions. Therefore, this issue requires re-adjudication.

  The case is remitted to the Adjudicating authority with the direction to decide the admissibility of cenvat credit on disputed imported Capital Goods afresh in accordance with provisions of Cenvat Credit Rules, 2004 and pass a speaking order after giving the assessee a reasonable opportunity of being heard - Appeal allowed by way of remand.

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• 2022 (12) TMI 720 - CESTAT AHMEDABAD
  

  Refund of un-utilized Cenvat Credit of Input Services used in or in relation to the manufacture of export goods - it is alleged that Appellant have taken double benefit in as much as they have taken refund of Rs. 45,35,610/- and they did not debit/reverse the said amount from Cenvat account - HELD THAT:- Originally when the appellant filed the refund claim under Notification No. 5/2006, the same was allowed by refund sanctioning authority. The revenue has challenged the sanction of refund claim on the ground that as per Notification No. 27/2012-CE (NT) dated 18.06.2012, which is issued in suppression of Notification No. 5/2006-CE(NT) dated 14.03.2006, “the amount that is claimed as refund under Rule 5 of the Cenvat Credit Rules shall be debited by the claimant from his cenvat credit account at the time of making the claim”.

  In the impugned orders the Commissioner (Appeals) has wrongly considered the claim under Notification No. 27/2012 instead of Notification No. 5/2006. The reliance made upon the provisions of Notification No. 27/2012- CE (NT) dated 18.06.2012 is absurd and illegal since the refund claim was admittedly filed in the present matter under the provisions of Notification No. 5/2006-CE (NT) dated 14.03.2006. it is pertinent to note that under Notification No. 5/2006, the requirement for debiting the refund claim amount did not exist.

  It is found from the refund order that all the claims were sent to Range offices for verification and the same have been duly verified by the Range officers. The charge of double benefit made by the revenue is absolutely incorrect on the face of the records in as much as the appellant even though did not carry forward and debit the refund amount in their cenvat account. However it is the case of the revenue that such cenvat credit was never utilised. The non transfer of unutilised cenvat credit is as good as reversal of cenvat. The charge of the double benefit will sustain only when the assessee in one hand claim the refund and in other hand utilise the same amount for payment of duty on their clearance of goods, which is no-body's case. Hence the allegation of double benefit of the same amount does not even exists. In this undisputed fact, the Learned Commissioner (Appeals) has erred in rejecting the appellant's claim for refund.

  Interest on delayed refund - HELD THAT:- The issue has been settled by various decisions. Hence by following the ratio of the decisions, mainly RANBAXY LABORATORIES LTD. VERSUS UNION OF INDIA AND ORS. [2011 (10) TMI 16 - SUPREME COURT] wherein the Hon'ble Supreme Court has held that interest on delayed refund is payable under Section 11BB of Central Excise Act, 1944 on the expiry of period of three months from the date of receipt of application under Section 11B(1) ibid - the appellant is entitled for the interest as per the Apex Court decision in Ranbaxy Laboratories Ltd.

  Appeal allowed - decided in favor of appellant.

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• 2022 (12) TMI 719 - CESTAT NEW DELHI
  

  Interest on the delayed refund of deposit - whether the appellant had deposited Rs.3,23,09,687/- under section 35F of the Excise Act because if it was such a deposit then the appellant would be entitled to interest under the provisions of section 35 FF of the Excise Act? - HELD THAT:- Section 11B of the Excise Act deals with claim for refund of duty and interest, if any, paid on such duty. Sub-section (1) of section 11B of the Excise Act provides that any person claiming refund of any duty of excise and interest, if any, paid on such duty may make an application for refund of such duty and interest to the Assistant Commissioner of Central Excise before the expiry of one year from the relevant date. It is, therefore, clear that section 11B of the Excise Act would only apply for claim of refund of duty and interest, if any. It would have no application in a case where the applicant seeks refund of the pre-deposit amount.

  The Commissioner (Appeals) rejected the claim by treating the refund to have been claimed by the appellant under section 11B of the Excise Act and consequently making applicable the provisions of section 11BB of the Excise Act that deals with interest on delayed refunds. The claim of the appellant was under section 35F of the Excise Act and not under section 11B of the Excise Act. Mere mention of a wrong provision in the letter submitted by the appellant will not work to the prejudice of the appellant if in law the refund claimed by the appellant can be traced to section 35F of the Excise Act. Interest was, therefore, required to be paid to the appellant under the provisions of section 35FF of the Excise Act and not under section 11BB of the Excise Act.

  The Supreme Court in UNION OF INDIA VERSUS TATA SSL LTD. [2007 (10) TMI 16 - SC ORDER] also relied upon its earlier judgment in COMMISSIONER OF CENTRAL EXCISE, HYDERABAD VERSUS ITC. LTD. [2004 (12) TMI 90 - SUPREME COURT] and the Circular dated 08 December, 2004 to hold that pre-deposit made as a condition for hearing the Appeal has to be refunded to the assessee with interest when the assessee becomes successful.

  In view of the provisions of section 35FF of the Excise Act it has to be held that since the amount deposited by the appellant under section 35F of the Excise Act was not refunded to the appellant within three months from the date of communication of the order of the Tribunal, the appellant would be entitled to interest after the expiry of three months from the date of the order of the Tribunal till the date of refund of such amount at the rate of six percent per annum - Appeal allowed in part.

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• 2022 (12) TMI 598 - CESTAT MUMBAI
  

  CENVAT credit - Input services - availability of Service tax charged on procurement of ‘insurance service’ for covering medical claims of employees who had opted for the Voluntary Separation Scheme (VRS) - HELD THAT:- the impugned order has held the service on which CENVAT credit had been availed was ineligible for having been incurred on employees who were to retire and consequently having no nexus with manufacturing activity that is essential for taking credit under rule 3 of CENVAT Credit Rules, 2004. The decision of the Larger bench [2022 (4) TMI 1357 - CESTAT MUMBAI (LB)] has categorically spelt an end to the controversy over eligibility of credit in such circumstances.

  Decided in favor fo assessee.

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• 2022 (12) TMI 562 - JHARKHAND HIGH COURT
  

  Claim of rebate (refund) - Export of goods - Period of limitation - Rule 18 of the Central Excise Rules, 2002 - Notification No. 19/2004 - Claim of interest on delayed rebate / refund - HELD THAT:- The Hon’ble Supreme Court [2022 (12) TMI 49 - SUPREME COURT] has answered the question in favour of the Revenue as, "while making claim for rebate of duty under Rule 18 of the Central Excise Rules, 2002, the period of limitation prescribed under Section 11B of the Central Excise Act, 1944 shall have to be applied and applicable."

  Decided against the Petitioner.

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• 2022 (12) TMI 561 - CESTAT CHENNAI
  

  Waiver of penalty in excess of 25% - irregularity in availing Cenvat Credit - Passing of excessive cenvat credit by the supplier - Reversal of Cenvat Credit on Inputs removed as such - the appellant is not contesting the duty or interest confirmed by the authorities below. In fact, the appellant had paid the duty and the interest along with 25% of the penalty within 30 days from receipt of the Order in Original.

  HELD THAT:- it is clear that the appellant had paid duty along with interest and 25% of penalty on receipt of the Order in Original. The adjudicating authority has not given the option to pay 25% of the penalty in the order passed by him. - payment of 25% of the penalty amount paid by the appellant would suffice. The impugned order confirming the equal penalty is set aside without disturbing the confirmation of duty and interest. The appeal is partly allowed in above terms with consequential relief if any.

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• 2022 (12) TMI 522 - CESTAT AHMEDABAD
  

  Levy of penalty under Rule 15(2) - charge that appellant have availed 100% credit instead of 50% and remaining 50% to be availed in the next Financial year in respect of capital goods - malafide intent or not - HELD THAT:- The appellant has not disputed the excess availment of credit of 50% in advance. However, admitting the same lapse they have reversed the credit and also paid the interest. There is no mala fide can be attributed towards the appellant for this lapse as the appellant is otherwise eligible for Cenvat credit of remaining 50% within a short time i.e. in the next financial year. Therefore, this lapse is inadvertent and cannot be said that there is any intention to evade duty or fraudulent availment of Cenvat credit. In this fact the case should have been concluded, on the basis of appellant’s reversal of excess credit of 50% along with payment of interest thereon which could have resulted into non issuance of SCN and consequently no penalty should have been imposed. Therefore, in this fact since there is no mala fide on the part of the appellant, the case is clearly covered by Section 11A(2B).

  The penalty is not imposable on the appellant - Appeal allowed - decided in favor of appellant.

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• 2022 (12) TMI 464 - CESTAT NEW DELHI
  

  Rectification of mistake - error apparent on the face of record or not - Denial of Cenvat Credit - ineligible documents - period of June, 2002 to March, 2004 - HELD THAT:- If few capital goods have not been specifically mentioned in the order such as G.I. wires and Galvanized Sheets, Valve Grinding Compounds, plastic sheet, sealant tape, fabric laminated sheet, rubber sheets, clutch plates etc. for packing and insulation purpose, pump Spares (for water treatment), Vanadium Pentaxide, Platinum Catalyst and Copper Oxide, Sodium Nitrate/ Hydrazine Hydrate (water treatment chemicals) & Paint Thinner, Varnish, but since none of them have been denied to be used by the appellant in the manufacturing process, the findings in impugned Final Order equally applies to those goods also.

  There is no error apparent on the face of the Final Order. Accordingly, we reiterate that the impugned Final Order hold appellant entitled for availing entire amount of Cenvat Credit as was denied on the ground of ineligible inputs/capital goods.

  Necessary rectification of para 16 & 18 of the Final Order as prayed to be rectified to be incorporated in the Final Order - application for ROM allowed in part.

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• 2022 (12) TMI 453 - SUPREME COURT
  

  Valuation - sale made partly to related party and partly to independent party - incorrect method of valuing related party transactions or not - SCN issued by the Revenue noted that the CEVR did not contain any guidelines on the methodology to be adopted for discovering the assessable value of goods, when sales are made partially to both independent parties and related parties - extended period of limitation.

  HELD THAT:- The CBEC Circular of 01.07.2002 is binding on the Revenue. If the show cause notice issued by the Revenue is found to be contrary to the Circular, it would prima facie result in abrogation of the uniformity and consistency which is strongly emphasized upon in RANADEY MICRONUTRIENTS VERSUS COLLECTOR OF CENTRAL EXCISE [1996 (9) TMI 124 - SUPREME COURT]. It goes without saying that the Revenue’s stance against its own circular can potentially lead to a chaotic situation where, with one hand, the Revenue would lay down instructions on how to interpret the relevant statutes and rules, and with the other hand, it would promptly disobey those very directions. Maintaining predictability in taxation law is of utmost importance and, for this reason, the Court should not accept an argument by the Revenue that waters down its own Circular as this would fall squarely within the contours of the prohibition outlined in PAPER PRODUCTS LTD. VERSUS COMMISSIONER OF CENTRAL EXCISE [1999 (8) TMI 70 - SUPREME COURT].

  The presumption under Section 4(1)(a) is that the sale from an Assessee to an independent party is the proper valuation to be used for determining excise duty. Conversely, a rebuttable presumption can be drawn regarding related party transactions and the value at which goods are sold in such situations. Rule 9 would be sufficient to resolve this issue when sales are made only to related entities, but where both independent and related parties are involved, we must refer to other means. In this context, Rule 11 obliges the Revenue to use “reasonable means” consistent with the principles under Section 4(1) of the CEA to arrive at the appropriate value - the show cause notice and the order of the Commissioner proceed along the basis that Section 4(1)(b) is applicable as the Assessee and MIL and MSL are related parties. Section 4(1)(a) was deemed to be inapplicable as it addresses situations where the parties are not related.

  Extended period of limitation - HELD THAT:- The justification of extending the period of limitation depends upon whether the Respondent-Assessee has suppressed facts and failed to provide accurate information regarding its sales to the Revenue. To this extent, there is a finding of fact against the Assessee

  Levy of interest and penalty - HELD THAT:- since the Revenue itself appeared to be unclear on the correct method of valuation of the goods, it is not appropriate to saddle the Respondent with additional liability, namely, other than the excise duty.

  The demand made by the Appellant is confirmed, we do not approve the levy of interest and penalties upon the Respondent, and direct that these amounts be reduced from the total recoverable amount from the Assessee.

  Appeal disposed off.

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• 2022 (12) TMI 452 - CESTAT NEW DELHI
  

  Clandestine manufacture and or removal - Goa brand gutkha - third party statements and evidences - admissible evidences or not - gross violation of principles of natural justice - HELD THAT:- The whole case of Revenue is made on the basis of the third party statements and some records and a note book recovered from the premises of M/s. G.M. Carriers, Bhiwandi. The entries in the said note book (private documents) are purported to have been made by one Mr. Javed Gamir Sheikh, an employee of M/s.G.M. Carriers, Bhiwandi, as stated by Mr. Javed Gamir Sheikh in his statement. He had deposed that these contain details of goods received from Jodhpur, both accounted and unaccounted. Mr. Javed Gamir Sheikh was not produced for cross examination by the Revenue, statement of whom was relied upon, who was the person, who claimed to have made the entries in abovementioned resumed note book and such entries were the basis for quantifying and raising the demand against the appellant.

  The partner of M/s. G.M. Carriers, Bhiwandi, Mr. A.A. Patni, in his cross examination has denied the maintenance of any such note book by them and has further contradicted the statement of Mr. Javed Gamir Sheikh, their employee. Thus, the said note book is not a reliable piece of evidence and further, the statement of Mr. Javed Gamir Sheikh is not an admissible evidence, as he was not produced for cross examination in violation of Section 9 D of the Act.

  There are no evidence of clandestine manufacture and removal of Goa brand gutkha has been found. The transporters of the appellant, M/s. KGN Transporter has not been investigated, at any stage. Further, admittedly, only minor /negligible variations have been found in the stock of the raw materials and finished goods in the course of inspection at the factory at Jodhpur. Admittedly, the documents resumed from Mr. Suresh B. Jajra are not related to this appellant but are related to other manufacturer like M/s. Royal Marwad, Ahmedabad, M/s. Meenakshi Foods Pvt. Ltd. and others. Such documents have been erroneously relied upon by the Revenue in demanding the duty under dispute. Mr. Suresh Jhajra has not supported the allegation of the Revenue during cross examination.

  The statements of the witnesses, which were relied upon by the Revenue have not stood the test of cross examination. Thus, the whole demand has been made on assumptions and presumptions.

  Appeal allowed - decided in favor of appellant.

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• 2022 (12) TMI 451 - CESTAT NEW DELHI
  

  Area based exemption - benefit of cum-duty value - whether the appellant is entitled to Area based exemption under exemption Notification No. 49/2003-CE dated 10.06.2003 r/w subsequent Notification No. 50/2003-CE (as amended)? - penalty u/s 11AC of CEA - HELD THAT:- The appellant is entitled to the benefit of recalculation of demand on cum-duty basis in accordance with explanation to Section 4(1)(b) of the Central Excise Act. Admittedly appellant have not collected Central Excise duty in addition to the sale price, in view of their claim of Area based exemption. Thus, the appellant shall be entitled to benefit of calculation of duty on cum-duty-price.

  The appellant shall be entitled to the benefit of Cenvat credit on inputs and input services and the demand payable shall be re-calculated accordingly, in view of the clear mandate of the Central Excise Act r/w Cenvat Credit Rules - the appellant shall be entitled to SSI benefit for the period April, 2015 to December 2015, subject to compliance of other conditions under the said notification, if any.

  Penalty under Section 11AC - HELD THAT:- There is no case of mis-representation, misstatement, suppression or fraud on the part of the appellant. The appellant were under bona fide belief in claiming the Area based exemption from Central Excise duty, as several other manufacturers located in the same locality, where also extended the benefit of Area based exemption. Under such undisputed facts, the penalty imposed under Section 11AC both on the appellant-company and its Managing Director Mr. Akhilesh Pratap Singh is set aside.

  The appeals are partly allowed and the impugned orders are modified to the extent of allowing cum-duty benefit and exemption available to Small Scale Industries to the extent admissible. CENVAT Credit will be admissible subject to verification by the officers. Penalties imposed on the appellant manufacturer and personal penalty imposed on Shri Akhilesh Pratap, Managing Director are set aside.

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• 2022 (12) TMI 450 - CESTAT NEW DELHI
  

  Valuation - department took a view that the appellant was selling sponge iron, M.S. billets and silicon manganese to its related parties at prices lower than the prices at which it sold them to independent buyers - Suppression of facts or not - extended period of limitation - HELD THAT:- Revenue’s submission that since the appellant is working under self assessment, any deficiency in payment of duty would amount to suppression of facts and extended period of limitation can be invoked is not correct because as per Excise Rules, all assessees work under self assessment but Section 11A still provides for normal period of limitation and extended period of limitation. If the argument of the learned authorised representative is accepted, there cannot be any normal period of limitation in any case because everyone is operating under self assessment and the provision for normal period of limitation would be rendered otiose.

  The period of dispute in the present case is October 2010 to July 2015 (i.e., before and after 2013 amendment to the Valuation Rules) but only the pre-2013 Valuation Rules were invoked in the SCN, in the order-in-original and in the impugned order. The case of the Revenue is that the appellant sold goods partly to Vandana and Shivali and partly to other independent buyers and therefore, Valuation Rules 9 and 10 do not apply and hence the residual provision - Valuation Rule 11 applies. The Valuation Rules as applicable for the period post-2013 were neither invoked nor discussed.

  Valuation Rule 4 deals with cases where goods are sold but not the time of removal. Valuation Rule 7 deals with cases where the goods are sold but not at the place of removal. It is neither alleged nor established that the goods were not sold at the time of removal or at the place of removal in this case. We are at a loss to understand as to why these Rules were invoked in the SCN because there is no dispute regarding the place of removal or time of removal - the SCN has not only NOT invoked the Valuation Rules relevant to the period post 2013, but does not also explain why Valuation Rules 11 read with Rules 4 &7 were invoked even for the period pre-2013.

  The scheme under the law is that although the duty is levied on manufacture of goods, it becomes payable only when they are removed and it must be paid based on self-assessment by the fifth or sixth of the following month. The assessee also has to file returns. Needless to say that the assessee may make mistakes in self-assessment and the check against this has been provided in the form of scrutiny of the returns by the officers and the officer scrutinising the returns can call for any documents and records from the assessee which it is bound to provide - the officer is mandated under the Rules to do what the audit has done much later. Had the officer scrutinised the returns as was mandated and called for any records, the alleged mistakes which were pointed out by the audit would have come to light and a SCN could have been issued under section 11A within the normal period of limitation.

  While the assessee was required to self–assess duty and file ER-1 return, a check against such self-assessment was the scrutiny which the officers were mandated to do by Rules. Audit is the next level of check against the scrutiny. If the audit points out some wrong assessment which was not pointed out by the officer scrutinising the ER-1 return, the fault lies at the doorstep of the officer. It does not, by itself, establish that the assessee had suppressed any facts.

  The impugned order cannot be sustained - Appeal allowed.

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• 2022 (12) TMI 366 - CESTAT AHMEDABAD
  

  Levy of penalty Rule 26 of Central Excise Act, 2002 - charge of abatement in the offence of fraudulent availment of cenvat credit - HELD THAT:- The penalties on the present appellants were imposed under Rule 26 of the Central Excise Rules, 2002 for the different role for the charge of abating the fraudulent availment of cenvat credit by Shree Ram Tubes Pvt Ltd. M/s. Shree Ram Tubes Pvt Ltd and many other notices have got their case settle under SVLDRS. Therefore, the main case of M/s. Shree Ram Tubes Pvt Ltd could not be decided on merit as the appeal was dismissed as withdrawn.

  In the present appeals as regard the appellant Shri Bablubhai Abdulbhai Khan it was found that this appellant is the Proprietor of M/s. Palghar Golden Roadlines with effect from March 2007 before that his father Late Shri Matiullah was the Proprietor of M/s. Palghar Golden Road Lines. However, the appellant was authorized for all the activities on behalf of Palghar Golden Road Lines and his statement dated 30.08.2007 was recorded wherein he has admitted regarding issuance of blanks LRs. Therefore, he was directly involved in the overall offence of facilitating wrong availment of credit to M/s. Shree Ram Tubes Pvt Ltd. For imposition of penalty under Rule 26 the status of the person is not relevant whereas if any person is involved in any capacity for evading of duty or wrong availment of cenvat credit his offence is punishable under Rule 26 of Central Excise Rules, 2002 - merely because he was not the proprietor of Palghar Golden Roadlines at the relevant time but he was otherwise actively involved in the modus operandi of wrong availment of Cenvat credit by M/s Shree ram Tubes Pvt Ltd.

  All the appellant having direct and active role in entire modus operandi of wrong availment of cenvat credit by M/s. Shree Ram Tubes Pvt Ltd, particularly when M/s. Shree Ram Tubes Pvt Ltd has admitted the liability of wrongly availed cenvat credit. Therefore, the penalties imposed on the appellant is correct hence, the same is upheld.

  Appeal dismissed.

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• 2022 (12) TMI 365 - CESTAT AHMEDABAD
  

  Levy of interest and penalty - Reversal of CENVAT Credit (without utilization) on being pointed out, before issuance of SCN - malafide intent or not - extended period of limitation - HELD THAT:- There is no dispute that the appellant have wrongly availed the cenvat credit and subsequently reversed. The provision for interest is made under Rule 14 of the Cenvat Credit Rules, 2004 - From the plain reading of rule 14 of CCR, it is clear that the interest is chargeable in event of either wrongly availed credit or wrongly utilized. Therefore, even though the credit was not utilized but since the credit was wrongly availed the interest is unavoidably chargeable.

  Following the Supreme Court judgment in the case of UOI AND ORS. VERSUS IND-SWIFT LABORATORIES LTD. [2011 (2) TMI 6 - SUPREME COURT], the interest is chargeable. Hence, the demand of interest is upheld.

  Extended period of limitation - Penalty under section 11 AC which is equal to the amount of cenvat credit availed - HELD THAT:- The show cause notice has invoked the extended period, the ingredients for invoking extended period for demand as well as for imposition of penalty under section 11 AC are same. The demand being under extended period the penalty is inevitable, once demand is sustainable for extended period, the penalty under section 11 AC is imposed as mandatory - There is no dispute that the appellant have availed the cenvat credit during January 2005 to march 2007 and it is on pointed out by the department the same was reversed on 20.07.2007. The wrong availment of credit was suppressed from the department as the department was not aware that the credit taken by the appellant was pertaining to their other unit. In this circumstance the extended period was rightly invoked. Therefore, the demand for the extended period as well as equal penalty is sustainable.

  Appeal is dismissed.

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• 2022 (12) TMI 364 - CESTAT NEW DELHI
  

  Interest on the amount of refund sanctioned - deposit made during the investigations is merely a deposit of the duty under section 11B of Central Excise Act, 1944 (CEA), or not - applicability of Section 11BB of CEA - HELD THAT:- Hon’ble Apex Court has settled this issue in the case of SANDVIK ASIA LIMITED VERSUS COMMISSIONER OF INCOME-TAX AND OTHERS [2006 (1) TMI 55 - SUPREME COURT] holding the assessee entitled for interest on the refund of the amount which he was not liable to pay to the Department from that date of the deposit itself. Section 11B of CEA is not applicable to such revenue deposits.

  It is further observed, as has been brought to notice, that Department since the time of issue of show cause notice have been acknowledging that amount in question is neither the amount of duty nor the amount of pre-deposit, the said acknowledgement is sufficient when read in the light of above discussed law to hold that the appellant was definitely entitled for interest on the amount of Rs.10,00,000/- but not in accordance with section 11B/11BB of Central Excise Act, 1944. Accordingly, it is held that Commissioner (Appeals) has wrongly involved the said provision while restricting the entitlement of appellant for claim of interest. The appellant is entitled for the interest @ 12% per annum from the date it was deposited i.e. with effect from 31.08.2009/ date of clearance of cheque for the said amount of Rs 10 lakh. Issue No. (1) as framed above accordingly is decided in favour of the appellant.

  Whether the Appellant is entitled for interest on the amount of interest if sanctioned as compensation to be paid by the Department for causing unnecessary monetary loss and harassment to the Appellant? - HELD THAT:- The amount in question was not a duty deposit but was the Revenue deposit, the Government has retained the said amount over long years, as such appellant is held entitled for interest as compensation on the amount of interest already awarded under issue No. (1) however, @6% from the date of impugned Order-in-Appeal till its disbursement.

  Appeal allowed - decided in favor of appellant.

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• 2022 (12) TMI 350 - CESTAT AHMEDABAD
  

  SSI exemption Notification No. 8/2003-CE dated 01.03.2003 as amended by Notification No. 8/2006-CE dated 01.03.2006 - power driven pumps which does not bear BIS specification and the appellant did not obtain ISI certificate - HELD THAT:- Admittedly the appellant’s product is not in conformation to BIS standard as specified in the notification. They have not obtained any ISI certificate. Therefore, exemption of SSI notification 08/2003-CE as amended, is not admissible to the appellant.

  The issue decided in the case of M/S BORANA PUMPS VERSUS COMMISSIONER OF CENTRAL GOODS AND SERVICE TAX, CUSTOMS & CENTRAL EXCISE, JODHPUR-I [2021 (6) TMI 1034 - CESTAT NEW DELHI] where it was held that it is not possible to agree with the contention of the learned Chartered Accountant for the appellant that the appellant was eligible for the benefit of exemption notification even though it had no BIS certificate, because the certificate was issued much later in 2014 which means that their products met the standards of BIS all through - since the appellant does not have ISI certification to conform the BIS Standard, the appellant is not eligible for SSI exemption Notification No. 8/2003-CE.

  Cum-duty price claimed by the appellant - HELD THAT:- As of now the issue has been settled that in any case where the duty is demanded, the principle of cum-duty price shall be applicable. The appellant have taken support from the decision of Hon’ble Gujarat High Court in the case of COMMISSIONER OF C. EX. & CUS., DAMAN VERSUS POONAM PLASTICS INDUSTRIES [2010 (12) TMI 993 - GUJARAT HIGH COURT]. Therefore, we are of the view that appellant is entitled for cum-duty price benefit. Accordingly, the Adjudicating Authority shall recalculate the duty by extending the benefit of cum-duty price.

  The demand of duty subject to recalculation by extending cum-duty price benefit is sustainable. Since duty shall be re-quantified, the appellant shall be entitled to the option of reduced penalty of 25% subject to payment of re-quantified duty, interest, if any and 25% penalty within one month from the date of communication of re-quantified duty to be made by the Adjudicating Authority to the appellant - Appeal allowed by way of remand.

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• 2022 (12) TMI 349 - CESTAT NEW DELHI
  

  Levy of equal amount of penalty under Rule 15(2) of Cenvat Credit Rules, 2004 read with Section 11AC of the Central Excise Act - appellant have not utilised the amount of credit as is evident from their cenvat record and is reversed - HELD THAT:- The appellant did not contest the amount of Rs.2,07,598/- from the very beginning and have reversed the same and also deposited 15% penalty as early on 07.04.2016, which is almost one year prior to issuance of show cause notice. Further, it is evident that the said amount remained unutilised till the date of reversal. It has also been held by the 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], that where any cenvat credit has been reversed without utilisation of the same, amounts to credit having not been taken at all. Accordingly, appellant is not liable for interest & penalty for this amount.

  The disputed amount of Rs. 2,07,598/- stood concluded in terms of Section 11AC(1)(d) of the Central Excise Act. Accordingly, no show cause notice should have been issued to this amount. Therefore, the penalty imposed under Section 11AC is set aside alongwith demand of interest.

  Appeal allowed.

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• 2022 (12) TMI 348 - CESTAT NEW DELHI
  

  CENVAT Credit - common inputs and common input services which were used in the manufacture of the dutiable and exempted products - non-maintenance of separate records - pharmaceutical industry.

  Whether furnace oil used in the factory which gets consumed in the manufacturing process whether it is the manufacture of dutiable goods or exempted ones - HELD THAT:- The total amount of dispute of CENVAT credit which has been taken on this furnace oil and common input services is only Rs. 2,80,049/-. Evidently, the appellant would be entitled to part of the credit to the extent it was used in the manufacture of dutiable goods. Nevertheless, the appellant reversed the entire amount of CENVAT credit on these common inputs and input services. This fact was recorded in the reply to show cause notice itself. Therefore, the entire basis of the show cause notice that the appellant had taken CENVAT credit on common inputs and input services no longer exists.

  In the case of CHANDRAPUR MAGNET WIRES (P) LTD. VERSUS COLLECTOR OF C. EXCISE, NAGPUR [1995 (12) TMI 72 - SUPREME COURT], the Supreme Court has held that reversal of MODVAT credit after having taken it is as good as not taking the credit at all. In this case, similarly the credit taken by the appellant has been reversed and nothing survives. Therefore, the original adjudicating authority and the Commissioner (Appeals) were not correct in demanding an amount equal of 10% of value of the exempted goods under Rule 6 (3) of CCR.

  The impugned order cannot be sustained and needs to be set aside - Appeal allowed.

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• 2022 (12) TMI 308 - CESTAT NEW DELHI
  

  Disallowance of service tax cenvat credit - disallowance of more than the amount received from the ISD (Head Office) - HELD THAT:- The appellant had taken cenvat credit of Rs. 1,10,11,284/-, out of which the amount disallowed by court below is (Rs.2,06,485/- (-) 16,716) or Rs. 1,89,769/-. That I find that the court below have wrongly disallowed cenvat credit of Rs.10,09,135/-. Thus the impugned order is modified and the amount of disallowance of cenvat credit is restricted to Rs. 1,89,769/-. It is been stated by the learned counsel that this amount has already been deposited with the revenue. Further, I find that the appellant is entitled to cenvat credit on ‘broker services’ and ‘depository service’, as held by the Commissioner(Appeals).

  The appeal is allowed and the impugned orders are modified - The penalty imposed is also set aside.

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