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Central Excise - Case Laws
Showing 241 to 260 of 1430 Records
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2023 (11) TMI 215
Re-credit of cenvat credit already reversed - capital goods - applicability of provision of Section 11B of CEA - re-credit even as per cenvat credit rules is within the reasonable time or not - N/N. 30/2004-CE dated 09.07.2004 - HELD THAT:- The appellant admittedly had reversed the cenvat credit in the year 2006 and thereafter they claimed the re-credit after almost 7 years i.e. in 2013. Apart from the applicability of Section 11B, we find that even in case of initial credit, whether the appellant is entitled to re-credit after substantial period of 7 years was not examined by the adjudicating authority. The adjudicating authority has only decided the matter that Section 11B is not applicable in the case of re-credit. Even if it is assumed that provision of Section 11B for the purpose of re-credit of Cenvat credit is not applicable but whether the appellant can take the re-credit after 7 years of its reversal.
The matter as a whole needs to be reconsidered by the adjudicating authority - Appeal allowed by way of remand.
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2023 (11) TMI 214
Valuation - Recovery of the differential duty alongwith interest and penalty - determination of assessable value of insulated copper conductors manufactured by the appellants on job work basis during the period 01.04.2007 to 08.09.2008 - goods captively consumed - applicability of Rule 8 of the Central Excise Valuation Rules, 2000 - HELD THAT:- This issue is no more res-integra and has been considered by this Tribunal in the case of ROLASTAR PVT. LTD. VERSUS COMMISSIONER OF CENTRAL EXCISE, DAMAN [2011 (9) TMI 776 - CESTAT, AHMEDABAD] taking note of the amended provisions, namely, Rule 10A of Central Excise Valuation Rules, 2000 and Circulars issued on the subject by the Board from time to time and following the earlier order, held that Rule 8 is applicable to the assessee who manufactures the goods and uses the same captively either by himself or on his behalf. The said Rule would have been applicable if M/s. Sai Flipped Coil Pvt. Limited would have manufactured the goods themselves and then used the same captively.
The Hon’ble Supreme Court in the case of CCE, Pune vs Mahindra Ugine Steel Co Ltd [2015 (4) TMI 351 - SUPREME COURT] interpreting Rule 8 and Rule 11 of Central Excise Valuation Rules, 2000 for determination of the assessable value of the goods manufactured on job work basis held that Rule 11 would be applicable in arriving at the assessable value of the excisable goods. In the said case, the respondent was engaged in the manufacture of motor vehicle parts from the raw material supplied by the manufacturers of the motor vehicles on labour charge basis - The question before the Hon’ble Supreme Court was whether Rule 8 of the Central Excise Valuation Rules, 2000 or Rule 11 would apply in arriving at the valuation of the goods at the end of the assessee and it was held that Rule 8 is not applicable in the case of the respondent, it is Rule 11 only which becomes applicable as that is residuary provision for arriving at the value of any excisable goods which are not determined under any other rule.
Even though the aforesaid judgement was delivered prior to insertion of Rule 10A, however, there is no change in the wordings of Rule 8 after 01.03.2007, and the facts of the present case do not fall either under sub-rule (i) or sub-rule (ii) of Rule 10A of Central Excise Valuation Rules, 2000. Thus, following the principle laid down in aforesaid judgments, it is opined that Rule 8 of Central Excise Valuation Rules, 2000 is not applicable to the facts of the present case.
There are no merit in the impugned order passed by the ld. Commissioner (Appeals) - appeal allowed.
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2023 (11) TMI 165
Benefit of N/N. 5/2006 (Sl. No. 5) dated 01/03/2006 - Footwear - denial of benefit of notification on the ground that the appellant had manufactured and cleared footwear without embossing the MRP on such footwear - it was held by CESTAT that The exemption in the present case is required to be extended to the appellant, in as much as the substantial condition of MRP of the footwear has been satisfied even though the condition regarding the indelibly embossing the MRP has not been satisfied.
HELD THAT:- There are no reason to interfere in the matter - appeal dismissed.
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2023 (11) TMI 164
Demand of excise duty on the casting manufactured - principal manufacturer has not accounted for the job work goods manufactured and supplied by them - HELD THAT:- As per the documents referred by learned counsel, it is observed that the principal manufacturer M/s. Dyna Tex Enterprise has submitted necessary declaration / undertaking required under Notification No 214/86- CE and/ or Notification No 83/94 and 84/94- CE. Under the said notification the duty liability, if any arises, the same is recoverable from the principal manufacturer who has supplied the raw material to the job worker - It is also observed that the appellant have been receiving the goods under the job work challan and also clearing the processed goods under the subsidiary challan meant for job work goods. On this basis also no duty can be demanded from the appellant. However all the relevant documents needs to be verified to extend any benefit to the appellant.
Goods which is other than job work and cleared by the appellant on their own without issuing invoices - HELD THAT:- There is a force in the argument of the appellant that after deducting the value of job work goods if the value remains within the threshold limit of the SSI exemption under Notification No 08/2003 dated 01.03.2003 then the same will not liable to duty. However, this aspect also needs to be verified on the basis of the facts.
The entire matter needs to be re-considered - Appeal allowed by way of remand.
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2023 (11) TMI 163
Benefit of exemption Notification No. 04/2006-CE dated 01.03.2006 (Sr. No. 90) denied - Kraft Paper - non-compliance with the condition that Kraft Paper is manufactured from the pulp stage - whole case of the department is that the appellant did not have the pulping machine - HELD THAT:- The Adjudicating Authority has stated that on the visit of the Central Excise officer, it appeared that the noticee has not installed pulping machine in their premises during the relevant period. However, there is absolutely no evidence of visit of the Central Excise Officer as neither any documentary evidence nor panchnama was recorded about visit of the factory. Therefore, such observation of the Commissioner appears without any basis. Since the entire case is based on the assumption that the pulping machine was not installed but the department could not adduce any evidence to this allegation.
The sole basis of the department to hold that the appellant did not have pulping machine is the correspondence made with the supplier of pulping machine but no reply was received from the pulping machine supplier - Merely because the department could not get the response that itself will not conclude that the appellant have not purchased the pulping machine. In this position, it was incumbent on the department to physically verify, whether the pulping machinery installed in the appellant’s factory is of the relevant period which department failed to do such exercise.
The appellant did have the pulping machine at the relevant time. However, since the revenue has not carried out any verification, one opportunity is given to the Revenue to conduct the detail verification that the pulping machine was installed at the relevant point of time in the factory of the appellant or otherwise. Thereafter, to pass a denovo speaking order in the present matter.
Appeal is allowed by way of remand to the Adjudicating Authority for passing a fresh order within a period of two months from the date of this order, after following the principle of natural justice.
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2023 (11) TMI 162
Denial of CENVAT Credit - unfinished ‘mild steel (MS) pipes’ - failure to deploy any equipment for production - reversal of CENVAT Credit - credit reversed before issuance of SCN - HELD THAT:- It is found that ‘mild steel (MS) pipes’ procured by them had been cleared on payment of duty after undertaking some processing. It is now settled law that with duty having been paid, it was not open to central excise authorities to dispute credit availed on the goods procured for the purpose.
It was not alleged in the notice that the appellant was at any time deficient in credit availability at any point in time during the period of dispute; to allow the plea of remand would be nothing but authorizing contemplation of proceedings beyond the period of limitation by bringing new charges against the assessee. There is, thus, no ground for sustaining the disallowance of credit of ₹ 39,73,256.
For the claim of the appellant that ‘angles’, ‘beams’ and ‘channels’ were covered within definition of ‘capital goods’ in rule 2(a) of CENVAT Credit Rules, 2004, reliance was placed on the decision of the Tribunal in M/S. MANGLAM CEMENT LTD. VERSUS C.C.E., JAIPUR-I [2018 (3) TMI 1547 - CESTAT NEW DELHI] and in CC & CE, VISAKHAPATNAM VERSUS M/S. A.P.P. MILLS LIMITED [2013 (7) TMI 494 - CESTAT BANGALORE]. It is, however, on record that the appellant had not yet procured the ‘cranes’ for whose support the said goods had been purportedly deployed. The facts being, thus, at variance with the cited decisions and, the ‘capital goods’, not having been installed the claim of eligibility of goods used for installing ‘structural support’ is not tenable.
CENVAT Credit Rules, 2004 offers the framework and the mechanics for neutralization of duty discharged at preceding stage of ‘value addition chain’; it is, therefore, procedural enunciation in which ‘availment’, as is ‘reversal’, is in the hands of ‘assessee’ while ‘restoration’, as is recovery, of credit is left to the jurisdictional authorities. While rule 14 of CENVAT Credit Rules, 2004 enables recourse to section 11A of Central Excise Act, 1944 as does rule 15 of CENVAT Credit Rules, 2004 enabling recourse to section 11AC of Central Excise Act, 1944, the latter cannot be drawn upon in the absence of the former - It is on record that the credit of ₹ 14,55,597 had been reversed well before issue of notice. There was, thus, no cause to initiate proceedings under rule 14 of CENVAT Credit Rules, 2004; it would appear that absurdity of ‘appropriating’ credit already reversed, and not restorable without prior approval from jurisdictional central excise authorities, does not seem have occurred to the adjudicating authority as an exercise in futility.
The appeal is allowed to the extent of setting aside recovery of ₹ 39,73,256 and of the penalty in full.
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2023 (11) TMI 161
Disallowance of CENVAT credit - procurement of ‘outward transportation service’ from their factory to depots of the principals - HELD THAT:- The Tribunal in MP BISCUITS (P.) LTD. VERSUS COMMISSIONER OF CENTRAL EXCISE, ALLAHABAD [2012 (10) TMI 623 - CESTAT, NEW DELHI] and in identical circumstances of another ‘job-worker’ of M/s Parle Products Pvt Ltd, set aside the recovery thus holding that it is apparent that the appellant has paid Service tax in respect of the input service i.e. the outward transportation of the biscuits to the place of removal. As such, in view of Rule 3 of Cenvat Credit Rules the appellant has rightly availed Cenvat credit.’
The impugned order is set aside and appeal allowed.
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2023 (11) TMI 160
Recovery of Central Excise Duty alongwith interest and penalty - including value of ‘scrap’ arising from ‘job-work’ in the assessable value as additional consideration from the principal for undertaking such work - HELD THAT:- Though the value adopted for discharge of duties in clearances effected by the assessee in GENERAL ENGINEERING WORKS VERSUS COMMR. OF C. EX., JAIPUR [2005 (3) TMI 16 - SUPREME COURT] is not incorporated therein, it would appear from the illustrative computation of the decision that ‘cost of raw materials’ was in dispute therein and not of conversion charges not reflecting the true consideration; hence the corollary of establishing that it was depressed. There is no finding of such nature in the impugned order, in the appeal of jurisdictional Commissioner of Central Excise before the first appellate authority or in the show cause notice. Therefore, reliance placed in the impugned order on the said decision is not appropriate; the outcome therein is, thus, jeopardized.
Here too, it is not in dispute that the landed cost of raw materials is not doubted and that the impugned ‘scrap’ has been generated from such raw material. That value, having been included once, is not required to added once again for assessment to duty.
The impugned order set aside - appeal allowed.
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2023 (11) TMI 159
Refund claim - rejection of claim of the appellant for non-production of challans showing ‘nil’ payment of duty on those goods in the warehouse - principles of unjust enrichment - HELD THAT:- It is well-settled that show cause notice is the foundation of all proceedings and in appellate disposal, only the issue in appeal may be argued or abetted. Failure to challenge assessment as an impediment to sanction of refund was not an issue thus far in the present dispute and in the absence of appeal/memorandum of cross-objections on behalf of Revenue, a fresh ground entered by Learned Authorized Representative does not merit consideration.
The original authority has premised ineligibility with the finding that the date of sale of goods being undisputedly after the levy came into force, there is no alternative but for duty to be discharged. This is an improper appreciation of the nature of this levy and, more so, on induction of impugned goods into the list of taxable goods. Being a tax on manufacture, goods produced prior to the levy having come into force are not to be subjected to duties of central excise - ‘stock transfer’, as an internal nomenclature, has nothing to do with clearance of goods which would be subjected to dutiability from 1st March 2011. It is clear from the communication of the Central Board of Excise & Customs (CBEC) supra that the specific aspect referred to in the order of the original authority is restricted to goods lying in the registered factory premises as on date of imposition of levy which, uncontestedly, is not the issue here.
As the impugned goods were not dutiable, eligibility for refund should follow. The claim of the appellant being that duty had, nonetheless, been discharged, it was incumbent upon them to demonstrate such payment. The appellant had submitted details of goods lying elsewhere and to the extent that these can be correlated, that onus will stand discharged. It is on record that the appellant had, in proceedings before the original authority, submitted that challans could be produced and it is on record that these had not been. Therefore, it is only appropriate that this be complied with and, upon such, there need be no further controversy over duty having been discharged on non-dutiable goods.
Section 11B mandates that all refunds undergo the test of bar of ‘unjust enrichment’ and it falls upon the appellant to successfully navigate that.
The refund application restored before the original authority for fresh processing - impugned order set aside - appeal allowed.
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2023 (11) TMI 158
Levy of Excise Duty - insurance amount recovered by the appellant from their customers by enhancing the assessable value of the cleared goods by the amount collected as insurance over and above the amount actually paid towards insurance - HELD THAT:- The issue is no longer res-integra and stands settled by the decision of this Tribunal in series of decisions in appellant’s own case and further the issue is also squarely covered by the decision of Hon’ble Supreme Court in the case of BARODA ELECTRIC METERS LTD. VERSUS COLLECTOR OF CENTRAL EXCISE [1997 (7) TMI 126 - SC ORDER], wherein following has been held that The Tribunal accepted the position that equalised freight was charged by the appellant from everyone, but proceeded to say that even though freight cannot be a part of the assessable value that wherever freight actually paid was less than the amount collected by way of freight and transportation charges the difference was appropriated by the appellant and, therefore, the same would be a part of the assessable value.
There are no reason to differ - appeal allowed.
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2023 (11) TMI 154
Refund of duty paid under protest - principles of unjust enrichment - rejection of refund on the ground that the appellants have passed on the incidence of duty to their customers - HELD THAT:- Revenue claims that the refund is hit by the doctrine of unjust enrichment i.e. the presumption that the incidence of duty has been passed on by the appellant unless the appellant establishes with documentary proof that the said incidence of duty has been actually borne by him and has not been passed on to the ultimate customers. We find that the presumption contained in the provisions pertaining to refund of Central Excise duty are rebuttable - Hon’ble Apex Court in the case of MAFATLAL INDUSTRIES LTD. VERSUS UNION OF INDIA [1996 (12) TMI 50 - SUPREME COURT] held that A manufacturer who has not passed on the duty can always prove that fact and if it is found that duty was not leviable on the transaction, he will get back the duty paid. Ordinarily speaking, no manufacturer would take the risk of not passing on the burden of duty. It would not be an exaggeration to say that whenever a manufacturer entertains a doubt, he would pass on the duty rather than not passing it on.
The Hon’ble Supreme Court rendered the above judgment in a different context. However, the observations of the Apex Court throw light on the fact that the presumption vis-à-vis doctrine of unjust enrichment is a rebuttable presumption. The appellants have submitted the evidence and argument in their favour. To that extent, it is found that the presumption has been rebutted by the appellants. As a result, it is for the Department to negate the evidence submitted by the appellants.
It is found that once the presumption under the doctrine of unjust enrichment is rebutted with documentary evidence, it cannot be negated by another presumption. It can only be negated by producing evidence contrary to the rebuttal of the appellant. Mere stating that the fact of price remaining same will not be an inevitable conclusion to establish that incidence of duty has not been passed on, is not enough.
Looking into the facts of the case and other evidence produced by the appellants, the fact of MRP being constant goes in favour of the appellants. Revenue did not rebut this submission by documentary data or evidence, except making a general statement that all taxes and duties would have been considered while fixing the MRP. In the instant case, Revenue has lost sight of the fact that the said MRP was fixed by the appellants during the no-duty regime. Therefore, the very fact of non-upgrading the MRP when the taxes were paid would in itself constitute evidence that the incidence of duty has not been passed on - The ultimate test of passing on the incidence of duty lies in the transaction of the appellants with the ultimate customers i.e. in the transaction between their depot and the customers. The MRP being constant, the test of presumption, that duty must have been inbuilt in MRP and must have been passed on, fails the test of reasonable fairness.
Revenue has not even considered the Cost Accountant certificate leave alone countering the same with valid reasons. Cost Accountant has issued the certificate after going through the accounts of the appellants and after satisfying himself about the truthfulness of the same. A certificate given by a professional cannot be dis-regarded unless it is proved to be blatantly wrong and contrary to the facts and evidence available on the hand. Thus, the certificate given by the Cost Accountant has an evidentiary value and cannot be rejected in a half-handed manner - The impugned order having been issued despite the evidence in the form of the certificate and without giving reasons as to why the same has not been taken into account cannot be held to be legally sustainable.
Appeal allowed.
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2023 (11) TMI 153
Demand of duty alongwith interest and penalty - appellant have deposited the demand even though under wrong registration number which was otherwise surrendered and the same was accepted by the department - HELD THAT:- The only mistake that inadvertently happened on the part of the appellant is that they have mentioned wrong registration while making the payment of excise duty. Therefore, except such mistake there is not a case of non-payment of duty, hence, the demand of duty cannot be sustained. Consecutively, the demand of interest and imposition of penalty shall also not sustain - the appellant had a bona fide view that the department have rectified the mistake occurred during the payment of excise duty under wrong registration number therefore, the revenue instead of issuing the show cause notice should have carried out the rectification in their record and closed the matter - it is not a mistake of the appellant only but equally it is a system fault of the department for which the appellant should not be made to suffer.
The demand of duty which was already paid and corresponding interest and penalties are not sustainable. Hence, the impugned order is set aside. Appeal is allowed.
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2023 (11) TMI 152
Clandestine removal - Who is the manufacturer liable for payment of duty under Pan Masala Packing Machines (Capacity Determination and Collection of Duty) Rules, 2008 - seizure of two Pouch Packing Machines [PPM] found installed in the premises of M/s Laxmi Tobacco Company, during search of the said Premises by the Central Excise officers on 19.09.2013.
HELD THAT:- There is no dispute on the facts that on a specific information, Central Excise Officers have detected an unregistered factory on 19.09.2013, where 2 Pouch Packing Machines [PPM] were found installed and in working condition, manufacturing notified goods i.e. "Pan Masala Containing Tobacco" known as "Gutkha". Some notified goods, raw materials and packing materials totally worth Rs. 15 lakhs required to manufacture such "Gutkha" were also found lying there, which are seized on 19.09.2013. Both the sides have fairly agreed that said unregistered factory has not followed Rules or paid duty under Pan Masala Packing Machines (Capacity Determination and Collection of Duty) Rules, 2008 in respect of 2 pouch packing machines [PPM] found installed at the premises of M/s Laxmi Tobacco Company on 19.09.2013.
There is no clinching tangible evidence or any corroborative evidence against Appellant Shri Paresh R Amin to connect him with actual manufacture and also to establish him as a manufacturer. Thus, Shri Paresh R Amin cannot be treated as the manufacturer liable to duty, interest and penalty in this case. However, the facts of seizure of two PPM found duly installed and goods seized in the premises on 19.09.2013 also have to be considered independently even without the support of any such of statements - It is not acceptable that owner of any premises would allow any third party to enter his premises to carry on business, may it is for the licit or the illicit business by any such third party. Any person with reasonable prudence will at least prepare a written rent agreement and clear evidences of rent receipts to keep his skin safe of any such illicit business, if any. Shri Purshottambhai C Patel is father of Shri Ashwinbhai Patel and in their Father-Son relation partnership document may not be necessarily prepared at all times.
In view of the undisputed fact that there is no partnership deed between the appellant Shri Pareshbhai R Amin and Shri Ashwinbhai Patel, factory premises was not rented out to so called partnership firm as there was no rent agreement or payment of rent, the machines were not found purchased by the so called partnership firm or even Shri Pareshbhai R. Amin, the goods were cleared on the letterhead of Laxmi Tobacco Company etc, it cannot be said that the appellant is the manufacturer therefore even if the fact of clandestine manufacture and its clearance is established but the appellant not being manufacturer, liability of duty, penalty cannot be fastened against the appellant.
The impugned order confirming demand of duty with interest and Penalty is not sustainable against the Appellant Shri Paresh Ramanbhai Amin - The impugned order-in-original qua Shri Paresh Amin is set aside - Appeal of Appellant Shri Paresh Ramanbhai Amin is allowed - Appeal disposed off.
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2023 (11) TMI 151
Suo motu re-credit taken by the respondent - outward transportation - HELD THAT:- As regard the suo motu re-credit, the entire proceeding was to disallow the cenvat credit on outward transportation and during the proceeding the respondent had reversed the credit when the Tribunal has allowed the credit on merit in respect of outward transportation vide Tribunal in Welspun Gujarat Stahl Rohren Ltd. [2012 (4) TMI 386 - CESTAT, AHMEDABAD]. The respondent was legally entitled for re-credit as consequential relief flowing from the said Tribunal’s order. Therefore there are nothing wrong in taking the suo moto re-credit which is clearly in compliance to the Tribunal’s order.
This issue has been considered by this Tribunal in case of COMMISSIONER OF CENTRAL EXCISE SURAT VERSUS M/S. VARDHMAN ACRYLICS LIMITED [2013 (5) TMI 6 - CESTAT AHMEDABAD] wherein the Tribunal has held that suo motu admissible Cenvat credit taken, after getting a favourable decision from the first appellate authority, is correct.
Thus, there are nothing wrong in respondent’s taking suo moto re-credit of cenvat credit which was reversed - there is no infirmity in the impugned order - appeal of revenue dismissed.
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2023 (11) TMI 150
CENVAT Credit - input services commonly used by the appellant in the manufacture of their own dutiable final products as well as in the manufacture of forgings which was cleared to M/s.TENGEL without payment of duty - non-maintenance of separate records - HELD THAT:- On perusal of the facts as brought out from the records, it is understood that goods cleared to the principal manufacturer has suffered duty at the hands of the principal manufacturer. This being so, the final product cleared by the appellant to the principal manufacturer cannot be considered as exempted goods. All the products cleared by the appellant viz. forgings are dutiable products and has suffered duty at the hands of the appellant or the principal manufacturer. Then, Rule 6 (3) does not come into application. The appellant is not liable to reverse the credit.
The issue was considered by the Hon’ble Apex Court in the case of ESCORTS LTD. VERSUS COMMISSIONER OF CENTRAL EXCISE, DELHI [2004 (8) TMI 106 - SUPREME COURT] wherein the Hon’ble Apex Court held that when the final product has been subject to duty, it cannot be said that intermediate product which is cleared without payment of duty is an exempted good for compliance with the provisions of Rule 57C of erstwhile Modvat Credit.
Thus, the demand cannot sustain. The impugned order is set aside. Appeal is allowed.
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2023 (11) TMI 149
Lapse of Unutilized Credit - Absolute exemption or Conditional exemption notification - Balance of Cenvat Credit shall lapse in terms of Rule 11(3) of Cenvat Credit Rules, 2004 - availment of Notification No. 30/2004-CE dated 09.07.2004 after reversal of Cenvat Credit on input, input in process and input contained in final product - HELD THAT:- It is found that the revenue’s contention is that on availment of exemption notification No. 30/2004-CE dated 09.07.2004 after reversal of Cenvat Credit on input, input in process and input contained in the final product, whatever balance credit is left out the same shall lapse in terms of Rule 11(3) of Cenvat Credit Rules, 2004.
From the plain reading of the Rule 11(3) of Cenvat Credit Rules, 2004, it can be seen that as per 11(3)(i) if an assessee opt for exemption from whole of the duty under a notification issued under Section 5A, the assessee is required to pay an amount equalent to Cenvat Credit in respect of input lying in stock, input in process and input contained in the final product lying in stock. As per this rule irrespective of whether the notification is absolute or otherwise the assessee is required to reverse the credit in respect of input, input in process or input contained in final product lying in stock as on date of opting the exemption notification - it is clear that the reversal of credit on the stock of input, input in process and input contained in final product is required to be reversed by an assessee who avails any exemption. However, the provision for lapsing of credit on remaining balance shall apply only in case where the exemption notification is absolute.
In the present case the notification No. 30/2004-CE contains a condition namely “provided that nothing contain in this notification shall apply to the goods in respect of which credit of duty on input has been taken under the provision of Cenvat Credit Rule, 2002”. Since the notification contained the said condition the notification No. 30/2004-CE is not an absolute exemption. Consequently, the provision of lapsing of the remaining credit in terms of Rule 11(3) (ii) shall not apply in the fact of the present case. This issue has been considered time and again in various judgments as cited by the appellant. Therefore, the issue is no longer res-integra.
The impugned order is not sustainable. Hence, the same is set aside appeal is allowed.
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2023 (11) TMI 148
Refund of duty paid under protest - Department is of the view that goods cleared are not used at the water treatment plant itself and therefore the benefit of notification is not available to the goods - eligibility for the benefit of exemption of the Notification 6/2006 dated 1/3/2006 - HELD THAT:- The condition no. 23 of the said notification for availing the exemption is that the assessee has to produce a certificate issued by the District Collector, certifying that the goods are intended for use as specified in column 3 of the table.
In column 3 of the table as per para (1), all items of machinery, including instruments apparatus and appliances, auxillary equipment and other components / parts required for setting up of water treatment plant is eligible for exemption. The department has denied the exemption alleging that the goods are used for the sub station / pumping station as part of the water supply project and not specifically at the water treatment plant.
Similar issue was considered by the Tribunal in the case of M/S MAN INDUSTRIES (INDIA) LTD, M/S SUBHASH PROJECTS & MARKETING LTD, M/S THE INDIAN HUME PIPE CO. LTD VERSUS COMMISSIONER CE & ST (LTU) MUMBAI [2019 (5) TMI 367 - CESTAT MUMBAI]. The issue under consideration was whether the benefit of Notification is available to the pipes which were used beyond the first storage facility. The Tribunal held that the assessee would be eligible for the benefit of notification.
In the case of P & C CONSTRUCTIONS P. LTD. VERSUS COMMISSIONER OF CUSTOMS & CENTRAL EXCISE, SALEM [2017 (8) TMI 1045 - CESTAT CHENNAI], the Tribunal observed that when certificate has been issued by District Collector, and TWAD Board stating that the goods are intended for setting up of the water treatment plant, the department cannot deny the exemption. The issue was in respect to the eligibility of credit on PSC pipes which were used for setting up of the water treatment plant and needed for carrying water from its source to the plant and from there to the storage facility.
The Ld. AR has relied upon the decision in the case of M/S. PRECISE ENGINEER VERSUS COMMISSIONER OF CENTRAL EXCISE & ST, VADODARA [2019 (3) TMI 944 - CESTAT AHMEDABAD]. On perusal of the facts of the case, it is seen that the goods on which exemption was claimed by the appellant was Extension Bellows. The assessee claimed that these are components of water treatment plant. However, the facts do not show that the appellant had produced certificate issued by the District Collector stating that the goods were intended for setting up of water treatment plant.
The rejection of the refund claims is not justified. The impugned orders are set aside - appeal allowed.
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2023 (11) TMI 147
Excisability - intermediate goods - sugar syrup produced for use in manufacture of biscuits that were exempted from payment of duty - N/N. 67/95-CE dated 1st March 1995 - HELD THAT:-The appellant supplies ‘biscuits’ to M/s Parle Products Pvt Ltd and that ‘sugar syrup’ generated within the factory of the appellant is an essential ingredient in manufacture - The decision of the Hon’ble Supreme Court in NICHOLAS PIRAMAL INDIA LTD VERSUS CCE, MUMBAI [2010 (11) TMI 36 - SUPREME COURT], while elaborating upon ‘shelf-life’, has held that ‘marketability’ is a question of fact. The decision of the Tribunal in THE MAHARASHTRA AGRO INDUSTRIES DEVELOPMENT CORPORATION LTD., VERSUS COMMISSIONER OF CENTRAL EXCISE, NAGPUR [2017 (2) TMI 244 - CESTAT MUMBAI] relates to an entirely different product, viz. ‘sugar concentrate’, utilized in the manufacture of fruit juice.
In terms of the above decision of the Tribunal on ‘sugar syrup’ deployed in identical circumstances for identical purpose would apply in full. Accordingly, the impugned order cannot sustain and is set aside to allow the appeal - Appeal allowed.
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2023 (11) TMI 146
Admissibility of Cenvat Credit Rules paid on service tax under reverse charge mechanism - service fees paid to the principals namely Honda Motor Company Ltd., Japan for development of Part Manual and Service Manual - HELD THAT:- Part catalogue is the document created for codification of all the parts for proper understanding and management of inventory. This codification is used not only for inventory management but also for placing the orders on the suppliers and receiving the orders from the dealers/customers. Even the storage bins are to be identified as per these part catalogue. Orders are placed by referring to the part as codified in this manual and is essential uniform understanding of the part by all in the chain. Without this manual all the operations of the appellant will be haphazard. So, this part catalogue is essentially the part inventory management, procurement and supply system of the parts to the dealers and through them to the ultimate customers - there are no merits in the submissions or the observations made by the lower authority contrary to this.
It is quite evident that the maintenance repairs and construction manual, is like an idiot guide to the dealers for undertaking the work of repairs and maintenance of the vehicles ensuring compliance with the high safety standards set by Honda Motors, by use of the genuine parts supplied by the appellant. It provides how to further maintain and repair the vehicles brought to the dealers by their customers. Such standardization is absolutely essential to ensure that standard set by the manufacturer are achieved irrespective of the person or the dealer servicing the vehicle - This standardization will promote the sale of genuine parts which are supplied or sold by the appellants. Thus this manual is essential to the activities undertaken by the appellant through supply of genuine spare parts.
Thus, denial of CENVAT credit in respect of services of development of “Part Catalogue” and “Maintenance, Repair and Construction Manual” cannot be upheld. As no demand survives the demand for interest and penalties imposed also are set aside.
There are no merits in the impugned order and the same is accordingly set aside - appeal allowed.
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2023 (11) TMI 145
Levy of Additional duty of excise - clearance of pre-budget stock after 10.07.2014 - HELD THAT:- The Finance Act 2014 introduced an additional duty of Excise (AED) on waters including mineral water and aerated waters containing sugar or other sweetening matter falling under chapter heading 220210. d) The changes in the Finance Act 2005 were announced on 10.7.2014 and it was understood by the Appellant that the same shall be effective from midnight 10/11 July 2014. It is relevant to mention that the declaration under Provisional Collection of Taxes Act, 1931 provided that clause 110 of the Bill shall have immediate effect under the Provisional Collection of Taxes Act, 1931.
The issue is no longer res-integra and is settled by the judgment of Hon'ble Supreme Court in the case of COLLECTOR OF C. EX., HYDERABAD VERSUS VAZIR SULTAN TOBACCO CO. LTD. [1996 (2) TMI 138 - SUPREME COURT]. The Hon'ble Supreme Court while dealing with special duty of excise has held that "Section 3 cannot be read as shifting the levy from the stage of manufacture or production of goods to the stage of removal. The levy is and remains upon the manufacture or production alone. Only the collection part of it is shifted to the stage of removal. Once this is so, the fact that the provisions of the Central Excise Act are applied in the matter of levy and collection of special excise duty cannot and does not mean that wherever the Central Excise duty is payable, the special excise duty is also payable automatically.
That CCE, Hyderabad Vs. Vazir Sultan Tobacco Company reiterates a settled position that duty of excise is leviable on 'manufacture' or production of the goods as contemplated by Entry 84 of List-1 of the Seventh Schedule to the Constitution. The mere fact that, for the sake of convenience, the duty is collected at the stage of removal cannot and does not change the character of the tax. It is upon the manufacture or production of goods and not on any other basis. Once the levy is not there at the time when the goods are manufactured or produced, it cannot be levied at the stage of removal of the said goods.
The impugned order cannot be sustained and the same is accordingly set aside - the appeal filed by the appellant is allowed.
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