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Central Excise - Case Laws
Showing 201 to 220 of 80345 Records
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2024 (3) TMI 124
Principles of Res-judicata - Invocation of Extended period of Limitation - Recovery of illegally availed CENVAT Credit with interest and penalty - earlier SCN was withdrawn and second SCN issued for the recovery - HELD THAT:- There are no substance in the argument of the learned advocate for the appellant in as much as the first show-cause notice had not been decided confirming the allegations and the demand proposed therein and not resulted in an appealable order. During the pendency of the adjudication of the said show-cause notice, another show-cause notice was issued by the Commissioner correcting the computation error in the first show-cause notice and a higher demand has been proposed.
However, there are substance in the argument of the learned advocate for the appellant that since in the first show-cause notice extended period of limitation has been invoked and stating the same set of facts which has been repeated in the second show-cause notice for invoking extended period of limitation, cannot be sustained in view of the judgment of the Hon’ble Supreme Court in NIZAM SUGAR FACTORY VERSUS COLLECTOR OF CENTRAL EXCISE, AP [2006 (4) TMI 127 - SUPREME COURT].
The matter is remanded to the Commissioner to restrict the adjudication of demand to normal period of limitation - Appeal allowed by way of remand.
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2024 (3) TMI 67
Reversal of Cenvat Credit - Job work - Availment of credit of duty paid on procurement of goods without being reversed on transfer to the contracted manufacturer under procedure prescribed in rule 4(5)(a) of CENVAT Credit Rules, 2004 - finished goods not having been returned to supplier - availment of credit of tax paid on goods that were not received in premises of appellant - HELD THAT:- The CENVAT credit scheme rests upon availment of credit and its continued existence till utilization; there is, therefore, ‘threshold’ entitlement flowing from rule 3 of CENVAT Credit Rules, 2004 and ‘retention’ eligibility flowing from rule 4 and rule 6 of CENVAT Credit Rules, 2004. The threshold entitlement of credit of ₹ 2,67,44,448 is not in dispute and it is only its continued retention, after the goods were dispatched to contracted entities, which has been sought to be disallowed owing to the finished goods not having been returned to the appellant or, in the alternative, its actual deployment in the finished product having been demonstrated. In doing so, the adjudicating authority has discarded the permission accorded by jurisdictional office for clearance from the premises of the contracted entity and, that too, by disclaim of ‘job worker’ status.
The availment of credit of ₹ 2,41,49,130 rests upon rule 3 of CENVAT Credit Rules, 2004 which is predicated upon discharge of duty liability and upon conformity with ‘inputs’ in rule 2 thereof. The denial has been grounded on non-receipt at premises of the appellant. In doing so, the adjudicating authority has not examined the implied extending of the premises of ‘manufacturer’ to that of ‘job-worker’ which is implicit in the excise duty liability revolving on ‘job-worker’ that becomes eligible credit in the account of the principal manufacturer upon bearing incidence of duty liability. That the impugned order has discarded claim of ‘job-worker’ status, and inadequately so, precluding consideration of this eligibility hinders us from deciding thereto warrants rectification.
The dispute warrants fresh determination within the framework of the observations - the impugned order set aside - matter remanded back to the adjudicating authority for fresh disposal.
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2024 (3) TMI 66
CENVAT Credit - though the tools and moulds purchased by them were continue in use for manufacture of excisable automobile components however same has been shown as sold on record on VAT-able invoice issued to M/s. Ford India Pvt. Limited - applicability of provisions of Rule 3(5A)(a) of the Cenvat Credit Rules, 2004 - HELD THAT:- From a plain reading of Rule 3(5A)(a), it can be seen that Cenvat credit is to be reversed only if the capital goods on which Cenvat credit has been availed by any assessee, have physically been removed - It is found from the entire proceedings that no evidence has been adduced by the department to prove that the tools and moulds which were purchased and used by the appellant have been physically removed from their factory of manufacture and therefore, since the tools and moulds were being used in manufacture of excisable goods it was wrong on the part of the department to ask for the payment of Central Excise duty on such tools and moulds that these are physically available in the appellant’s manufacturing premises.
Reliance can be placed in the case of M/S. L.G. BALAKRISHNAN AND BROS LTD. VERSUS COMMISSIONER OF CENTRAL EXCISE, TRICHY [2016 (6) TMI 829 - CESTAT CHENNAI] where it was held that We note that the invoices issued did not contain the details of any removal, mode of transport, rate of duty, duty payable thereon, etc., as per the requirement of Rule 11(2) of Central Excise Rules, 2002. We also note that based on these invoices no credit can be availed by any buyer as these are not in terms of Rule 9 of Cenvat Credit Rules, 2004. In view of settled legal position regarding need for physical removal of capital goods or inputs, in order to attract the provisions of Rule 3(5) of Cenvat Credit Rules, 2004, we find that there is no justification to invoke such provision to demand and recover any amount from the appellant in this case.
Timpugned order-in-original is without any merit and the same is set aside - appeal allowed.
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2024 (3) TMI 65
Issuance of second SCN without adjudicating first SCN - Valuation - adoption of incorrect valuation for goods cleared to its depot on normal transaction value which should have been cleared on the latest aggregate quantity of goods sold as against the price at which most number of goods were sold - violation of Rule 7 of the Central Excise Valuation (Determination of Price of Excisable Goods) Rules, 2000 - HELD THAT:- After adjudication order in respect of first show-cause notice was issued that had attained finality by dropping the demand by the CESTAT on 11.01.2018, the other show-cause notice was pursued and adjudication order was passed subsequent thereto. It seems that ignoring all legal provisions including the constitutional right of protection against double jeopardy that is being tried repeatedly for the same act of alleged omission despite a clear finding of the Hon'ble Supreme Court made in Osaka Alloys And Steels Pvt. Ltd. [2007 (9) TMI 615 - SC ORDER] that even without adjudication of the first show-cause notice, issue of second show-cause notice raising the demand is without jurisdiction, besides being time barred and in LUPIN LIMITED VERSUS UNION OF INDIA [2012 (6) TMI 785 - GUJARAT HIGH COURT] it was also held that issue of another show-cause notice without any new material would be wholly futile and prejudicial to the Assessee and would be an abuse of the process of law.
The order passed by the Commissioner of Central Tax (Appeals-I), Pune on the basis of a subsequent show-cause notice, after the first was held to be not sustainable by the CESTAT, is without jurisdiction and the same is, therefore, set aside with consequential relief - Appeal allowed.
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2024 (3) TMI 9
Refund of excise duty paid under protest against demand created on alleged manufacture and clearance of Zarda Scented Tobacco - applicability of principles of Unjust Enrichment if the Central Excise Duty has been paid under Compounded Levy Scheme, made applicable in terms of Section 3-A of the Central Excise Act, 1944 - rebuttal of presumption created under Section 12-B of the Central Excise Act, 1944 - HELD THAT:- In the present proceedings for refund, the revenue had failed to establish that any part of the excess duty paid by the assessee under protest had been passed - on. First, there is absence of finding of manufacture of goods (Zarda Scented Tobacco) on which duty demand may have been levied, paid and passed on. Second, there was no evidence to allege that the assessee charged higher value/M.R.P. on the goods cleared by it (Branded Chewing Tobacco) as may have accounted for the allegation of passing - on the disputed duty liability. Once the entire goods cleared by the assessee were only Branded Chewing Tobacco cleared at the M.R.P. rate, the presumption of passing - on the disputed duty liability (on the Zarda Scented Tobacco) never arose.
In absence of any material in support of the allegation made by the revenue authorities, the Tribunal rightly allowed the assessee's appeal, on facts.
Petition dismissed.
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2024 (3) TMI 8
Relevant date for allowing interest on delayed transfer of Cenvat credit - What is the period of delay and which date is to be taken as a relevant date merger of M/s. Britco with M/s. Hindustan Coca Cola Beverages Limited? - HELD THAT:- It is found that the scheme of arrangement of merger between M/s. Britco Foods Company Limited (M/s. Britco) with M/s. Hindustan Coca Cola Beverages Limited was approved by Hon’ble Delhi High Court vide its order dated 10.09.1999 and this merger order of Hon’ble High Court was conveyed by the appellant to the department vide its order dated 20.10.1999.
The Modvat/Cenvat credit which was lying in the balance of M/s. Britco stand transferred to M/s. Hindustan Coca Cola Beverages Limited from the date of merger of two entities which was effected vide order dated 10.09.1999. This order was conveyed to the department on 20.10.1999 as per the record of the appellant.
Department should have allowed the transfer of Modvat / Cenvat credit lying in RG23A and RG23C accounts of M/s. Britco Foods Company Limited to M/s. Hindustan Coca Cola Beverages Limited on receipt of letter of merger of two companies it is opined that 20.10.1999 is the date when department was informed of the formal merger of two entities and therefore the relevant date of transfer of Cenvat credit should be 20.10.1999.
Thus, relevant date for allowing interest on delayed transfer of Cenvat credit as ordered by Hon’ble Gujarat High Court in the above mentioned order dated 04.04.2013, will be 20.10.1999 - appeal allowed.
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2024 (3) TMI 7
Seeking to change the classification of the items manufactured and cleared by the appellants - reliance placed on the statement of Director of the Appellant company & Incharge of production related matters - HELD THAT:- It is found that other than the statement of Shri Purandar Reddy, Department has not taken any steps to obtain technical opinion of experts in respect of the impugned goods. The fact that the goods are manufactured by the appellants are but for the rice mill industry, as submitted by the appellants. Revenue could not show even a single example of such independent function of the items manufactured and cleared.
The Tribunal had an occasion to go into the classification of the impugned goods in the case of Alpsco Gaintech Pvt Ltd [2018 (12) TMI 478 - CESTAT CHANDIGARH], which was affirmed by the Hon’ble Apex Court. Tribunal held that Admittedly, in this case, these conveyors and elevators are specifically used for rice milling industry as the part of the composite machinery of rice milling, therefore, having merit classification under chapter heading No. 8437.
The Tribunal in the case of Moped Assembly [2000 (12) TMI 408 - CEGAT, CHENNAI], held that sheet metal components for use exclusively in rice milling industry are classifiable under heading 8437 of CETA.
The demands confirmed in the impugned order are not sustainable. When the demands are not sustainable, interest and penalty also do not survive - The impugned order set aside - appeal allowed.
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2024 (3) TMI 6
Recovery of excess CENVAT Credit alongwith interest and penalty - Nature of Duty Paid by 100% Export Oriented Units (EOU) - ineligible credit availed on the duty component of Basic Customs Duty, Education Cess and Secondary Higher Education Cess paid on the iron ore by the 100% EOU as per Sl. No.4 of Notification No.23/2003 CE dt. 31.3.2003 - Time Limitation - Suppression of facts or not - penalty - HELD THAT:- A plain reading of the said Sl. No.4, it is clear that the circumstances and corresponding method of computation of duty and quantum required to be paid by an 100% EOU in DTA is different from the duty payable against Sl. No. 2 of the said Notification. Therefore, no doubt the duty paid by an 100% EOU be considered as Excise duty in view of the principle of law settled by the Larger Bench in VIKRAM ISPAT VERSUS COMMISSIONER OF CENTRAL EXCISE, MUMBAI-III [2000 (8) TMI 111 - CEGAT, NEW DELHI].
In the instant case, the department has adopted a wrong basis in denying a portion of the CENVAT credit to the appellant of the duty paid by 100% EOUs, on the ground that component of BCD and applicable EC & SHEC on the BCD adopted in computing aggregate duties of Customs, which is nothing but Excise duty being not mentioned in Rule 3(1) of CCR, 2004, hence, not admissible. The said reasoning adopted by the Learned Commissioner in denying a portion of the duty as CENVAT credit cannot be sustained being contrary to the principle of law laid down in Vikram Ispat’s case.
Time Limitation - Suppression of facts or not - penalty - HELD THAT:- From the records of the case, it is clear that the appellants have been availing CENVAT credit on the duty paid by 100% EOU after duly reflecting the same in the relevant monthly ER-1 returns filed with the department periodically and the present demand relates to a portion of CENVAT credit held to be inadmissible. Thus, there are no merit in the allegation of the department that the appellant had suppressed availing of excess amount of CENVAT credit against the duty paid by 100% EOUs reflected in the invoices with an intend to evade payment of duty. Accordingly, the demand confirmed invoking extended period of limitation cannot be sustained. Consequently, the penalty imposed also cannot be sustained.
The impugned order is set aside - Appeal allowed.
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2024 (3) TMI 5
Entitlement to interest on account of delay in sanctioning the eligible refund in cash - Refund of unutilized cenvat credit claimed by the Appellant on export under LUT/ Bond - accumulation of credit on account of exports - amalgamation and merger of company - Cenvat credit utilized by the appellant during the quarter April, 2011 to June, 2011 was higher than the cenvat credit availed by it during the said quarter - possibility of adjusting the accumulated credit if the appellant had exported the goods on payment of duty - HELD THAT:- Though the appellant has filed the refund claim under Rule 5 for accumulated cenvat credit against export of goods but subsequently they have utilized the credit, hence, now they are not claiming the refund, however, they are claiming the interest for the period from the date of filing of application till the date of utilization of cenvat credit for which the refund claim was lodged - to decide the claim of interest first the eligibility of refund has to be decided.
From the records it is observed that both the lower authorities have rejected the refund claim on the ground that the appellant’s refund claim is in respect of the amount of cenvat which was transferred from M/s. Hazira Pipe Mill Ltd and Hazira Plate Ltd on account of amalgamation and merger of those companies in the present appellant’s company. However, from the chart presented by the appellant it prima facie shows that the credit of 205 Crores included in the credit availed shown in August, 2010 and October and November, 2010 was on account of transfer of credit due to amalgamation and merger and thereafter, it can be seen that the entire credit of 205 Crores has been utilized between December, 2010 to March-2011. This prima facie shows that the refund claim for the period April 2011 to June, 2011 appears to be the amount out of the fresh credit availed after the utilization of transferred credit. However, the details given in the chart along with documents were not verified by both the lower authorities which is necessary to come to the conclusion that whether the refund amount is related to the transferred credit or from the credit in respect of input and input service used in the manufacture of export goods.
As regard the claim of interest firstly the same is consequential to the eligibility of refund in the facts of the present case. Secondly, the claim of interest also needs to be considered independently, therefore, the entire matter needs to be remitted back to the original adjudicating authority.
Appeal is allowed by way of remand to the Adjudicating Authority.
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2024 (3) TMI 4
Redetermination of annual production capacity w.e.f. 01.11.2012 in terms of Rule 6 of Chewing Tobacco and Unmanufactured Tobacco Packing Machines (Capacity Determination And Collection of Duty) Rules, 2010 - seeking to declare the packing machines as uninstalled and sealed - HELD THAT:- Rule 4 of CER says that number of operating packing machines during any month shall be equal to the number of packing machines installed in the factory and if the manufacture doesn’t intent to operate any of those machines, Rule, 5 prescribes that uninstallation and sealing as well as removal from the factory premises was to be done by and under the supervision of Superintendent of the Central Excise but it’s proviso permits nonremoval from the factory premises only when it is not feasible to remove and in such an event it has been to be un-installed and sealed by the Superintendent in a manner that it can’t be operated.
It is not understood as to why Appellant was fastened with the liability to pay duty on the basis of number of packing machines available with him, when its uninstallation and sealing were duly made and Rule 8 is not violated, since calculation of the number of operating packing machines for a month is restricted to the maximum number of packing machine “installed”, apart from the fact that Circular No. 81/17/2007/CX-3 dated 20.04.2010, relied upon by the Appellant, issued by the Respondent-Department dictates not to take machines sealed by the Departmental Officer for the purpose of calculation of payment of duty.
The order passed by the Commissioner of Central Excise (Appeals), Pune-III is hereby set aside - Appeal allowed.
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2024 (3) TMI 3
CENVAT Credit - freight charges incurred from their factory premises to the factory premises of the buyer - place of removal - extended period of limitation - suppression of facts or not - HELD THAT:- In this particular case, without doubt the ‘place of removal’ is the factory premises of the Appellant only. Therefore, if the party has failed to claim any abatement on account of the freight charges incurred by them from their factory premises to premises of the receiver of the goods, the same cannot be come to the rescue in respect of the Cenvat Credit to be taken. Rule 2 (l) of the Cenvat Credit Rules, 2004, is very clear that the Cenvat Credit can be taken for the services utilized ‘upto the place of removal’ only. Therefore, there are no merits in the Appeal filed by the Appellant.
Suppression of facts - HELD THAT:- Admittedly, they have been paying the Service Tax on the freight charge and reflecting the same in the ST-3 Returns. For the Cenvat Credit taken on such Service Tax paid on GTA, they were filing their ER-1 Returns. Therefore, there cannot be any allegation of suppression on the part of the Appellant. Apart from this, it can also be taken as a case of interpretation. The Appellant has carried a bonafide belief that since they are paying the Excise Duty of the value which is inclusive of the freight charges, they would be eligible for the Cenvat Credit for the Service Tax paid on GTA Services for the outward transport - the allegation of suppression does not legally sustain.
The Appeal is allowed on account of limitation.
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2024 (2) TMI 1303
SSI Exemption - classification of goods - manufacturing articles of rubber - goods conforming to description corresponding to tariff item 4008 1110 of Schedule to Central Excise Tariff Act, 1985 was sought to be re-classified against tariff item 4008 1190 of Schedule to Central Excise Tariff Act, 1985 - HELD THAT:- Taking up the issue of classification as it is contingent upon resolution thereto that the discarding of claim for exemption available to ’small scale industry (SSI) will become relevant. At the outset, particular emphasis laid on the rigours of classification, within the framework of General Rules for Interpretation of the Schedule appended to Central Excise Tariff Act, 1985 and judicial determination, which forecloses admission in statements from having anything but peripheral influence on the exercise.
In the absence of any exposition of description corresponding to the proposed classification, it is well nigh impossible to approve the manner in which the adjudicating authority has proceeded.
Though there is elaborate discussion on the purported evidence, such as formulation found in private records, admission in statements that these reflected reality and samples sent for testing, the key to the findings are the reports of tests from Deputy Chief Chemist, Vadodara on the composition of the ‘end product’ as being polyethylene. This, along with the conclusion that the product is ‘not rubber’, led to the re-classification insofar as the appellant-assessees are concerned. While the presence of ‘polyethylene’ does fulfill the requirements of note 1 in chapter 39 of Schedule to Central Excise Tariff Act, 1985 and has not been controverted, there is abundantly less certainty on the conclusion in the test report of ‘no rubber’ especially when concatenated with the findings in the impugned order that ‘rubber’ was consumed in the production process.
The grounds of appeal preferred in the challenge mounted by Revenue to the impugned order confirms the need for re-determination. On the outcome of fresh determination also rests the appropriateness of penalty imposed on the individual-appellant. For those purposes, the impugned order is set aside and notice restored to the original authority for fresh decision on claim of appellant-assessees.
Matter remanded on issue insofar as appellant - assessee is concerned, the appropriate disposal of this appeal of Revenue too is re-determination of the dispute by the original authority - the appeals allowed by way of remand.
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2024 (2) TMI 1302
CENVAT Credit - duty paying documents - fraudulent transactions - eligibility of the credits availed by the Appellant on the basis of invoices issued towards purchase of sandalwood oil - HELD THAT:- Receipt of inputs as such by the Appellant and duty paying documents in conformity to Section 9 of the CENVAT Credit Rules are material for the purpose of determination of its eligibility to avail the credits. The inputs were supposed to be sandalwood oil but what was being transported/supplied were actually nothing but “plain water”, as noted by learned Commissioner in para 2.4 of his order describing content of search report for the 1475 kg of crude sandalwood oil, which were found in sealed condition and bound in wooden crates with airport security seal intact but when broke open and verified was found to be plain water only.
The sandalwood oil imported by him were of pure variety and there is nothing in trade known as crude sandalwood oil but for the purpose of certain rectification, method of distillation is applied so also in the case of Patchuli Oil. M/s J.G. Spices Ltd. was one of his customer to whom he supplied imported sandalwood oil and Patchuli oils in containers in the same sealed condition without any further processing. Being confronted with the fact that during search and seizure made by DGCEI of the stock of raw materials and finished group available at M/s J.G. Spices Ltd. premises representative sample were drawn from each container and Directorate of Forensic Science report was called for vide letter dated 29.09.2010 and it conformed the material content was nothing but “water” to which the Appellant’s reply was that they used to open the container, upon receipt and even Customs Officer do so before clearance but the cap of the drums were only put back without re-sealing.
There are no hesitation to come to the conclusion that goods were imported in sealed condition, taken to M/s. J.G. Spices Ltd., Meghalaya and kept therein also in sealed conditions and again returned back to different traders including the Appellant in sealed conditions affixing transit permit, railway freight invoices and in the process additional Excise Duty which was VAT component of State’s tax collected by Union and Central Excise duty both were realized at both the points by the supplier and purchasers respectively causing loss to the State exchequer.
The Appellant had not purchased sandalwood oil from M/s J.G. Spices Ltd. through those invoices and the goods transportation documents would not absolve the Appellant from its liability that the inputs against which credits availed were in fact not valid inputs namely sandalwood oil - Appeal dismissed.
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2024 (2) TMI 1301
CENVAT Credit - clearance of inputs as such - recovery of credit alongwith interest and penalty - sub-rule (5) of Rule 3 of Cenvat Credit Rules, 2004 - HELD THAT:- On going through decision of this Tribunal in the case of THE COMMISSIONER OF CENTRAL EXCISE, PUNE VERSUS AJINKYA ENTERPRISES [2012 (7) TMI 141 - BOMBAY HIGH COURT]. In the said case, cenvat credit was availed and after processing of inputs, the same was utilized towards payment of duty and subsequently it was held that the process which was undertaken did not amount to manufacture and, therefore, the said clearances did not attract central excise duty. Under those circumstances, it was held that since the duty payment was accepted by Revenue, the availed cenvat credit cannot be reversed. Such circumstances are not available in the present case. Therefore, the ruling in the said case is not applicable in the present case.
Insofar as the impugned order is concerned in respect of the allowance of cenvat credit of Rs.5,63,66,047/- is concerned, there are no infirmity with the same - that part of the impugned order through which cenvat credit of Rs.5,63,66,047/- was disallowed is not interfered and is ordered to be recovered along with interest and equal penalty.
Demand of Rs.1,18,45,107/- - HELD THAT:- The appellant was eligible to debit proportionate cenvat credit attributable to trading activity and we also find that such debited amount of Rs.3,44,773/- was appropriated by the original authority - the impugned order in respect of demand of Rs.1,18,45,107/-, interest and penalty is set aside.
The penalty imposed on Shri Vijay S. Nair, Managing Director is set aside, and there are no omission or commission on his part in causing any loss to the exchequer.
Appeal allowed in part.
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2024 (2) TMI 1300
CENVAT Credit - input services - refilling of gases from bulk containers to retail containers and conversion from liquid state to gaseous state amounts to manufacture or not - credit availed on input services has been denied alleging that the appellant has not been able to establish nexus of the input services with the manufacturing activity - HELD THAT:- When the services qualify as input services, the credit ought to be allowed unless there is discrepancy in the payment of Service Tax or in regard to the documents. There is no such dispute in this case. In the present case, the services availed are in the nature of inward and outward transportation of the goods. This is essential services for the manufacturing activity. Further, there is no requirement for an assessee to furnish one-to-one co-relation of the input services and the credit availed.
There are no merits in the view taken by the Adjudicating Authority in denying the credit availed on input services. Recently, the Larger Bench in the case of M/s. Ramco Cements Limited Vs. Commissioner of Central Excise, Puducherry [2020 (6) TMI 794 - CESTAT CHENNAI] had held that the credit availed on outward transportation services is eligible when the freight charges are included in the taxable value.
The disallowance of credit on input services and the confirmation of the demand in this regard without basis are requires to be set aside - Appeal allowed.
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2024 (2) TMI 1251
Seeking permission to withdraw the present appeal - Cum-duty benefit - it was held by High Court that Since the taxes were paid by the respondent-assessee on the goods as per the explanation to Section 4(1), the assessee was entitled to cum-duty benefit - HELD THAT:- The Civil Appeal is dismissed as withdrawn.
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2024 (2) TMI 1250
Maintainability of appeal - Appellate jurisdiction - HELD THAT:- This appeal can be disposed of on the short ground that the Custom, Excise and Service Tax Appellate Tribunal (the CESTAT) in exercise of its appellate jurisdiction has allowed the appeal filed by the Department without giving any reason whatsoever. For the reason that the decision is not accompanied by reasons, the judgment and order passed by the CESTAT is set aside and matter remanded back for consideration and passing appropriate orders giving reasons for its order.
Appeal disposed off.
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2024 (2) TMI 1249
Principles of unjust enrichment - Refund amount ordered to be credited to the Consumer Welfare Fund instead of being paid to the appellant - HELD THAT:- The appellant paid the disputed amount as differential duty after the SCN was issued and it was not paid at the time of clearance of the goods nor was an invoice raised for this amount at that time. It is also an admitted fact that the appellant had attempted to recover the differential duty from its customers M/s Bharat Broadband Network Ltd. by issuing a supplementary invoice, but the customer refused to pay it on the ground that central excise duty @ 10.3% was already paid as per the purchase order and the differential duty paid after calculating excise duty at the higher rate of 12.36% was not required to be paid by it.
The appellant had borne the burden of the differential duty and had not passed it on to its customer or to anyone. Thus, the appellant’s case falls squarely under Clause (e) of the third proviso to section 11B of the Central Excise Act, 19445, i.e., the duty of excise and interest paid on such duty were borne by the appellant manufacturer and it had not passed on the incidence of such duty and interest to any other person.
The appellant is entitled to the refund of the amount sanctioned which should be paid to it instead of it being credited to the Consumer Welfare Fund. Needless to say the consequential interest must also be paid as per section 11BB.
The refund amount along with interest under section 11BB should be paid to the appellant instead of being credited to the Consumer Welfare Fund - the impugned order is set aside - appeal allowed.
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2024 (2) TMI 1248
CENVAT Credit - common inputs/input services used for manufacture of stock transferred exempted goods (lime stone) and dutiable products (Cement/Clinker) - non-maintenance of separate accounts as required under Rule 6(2) of Cenvat Credit Rules, 2004 - liability to pay an amount of 5%/6% of the value of exempted goods (stock transferred lime stone) as under Rule 6(3)(i) of Cenvat Credit Rules, 2004 - Time Limitation - HELD THAT:- The lime stone stock transferred being exempted product there is no question of payment of duty or consequent availment of credit by receiving unit. When appellant has used common inputs/input services for stock transferred limestone, appellant has to maintain separate accounts. The appellant not having maintained separate accounts and not having exercised any option under Rule 6(3), the demand raised invoking Rule 6(3)(i) is legal and proper.
The decision of the Hon’ble Apex Court in the case of JAYPEE REWA CEMENT VERSUS COMMISSIONER OF CENTRAL EXCISE, MP [2001 (8) TMI 1332 - SUPREME COURT] is referred by Ld. Consultant to argue that lime stone is only an intermediate product and cannot be considered as a final product. The issue that was considered in the said case was whether Modvat credit is eligible on explosives used for extraction of limestone which is the raw material used in manufacture of cement. The Hon’ble Court was considering the applicability of Rule 57A of erstwhile Central Excise Rules, 1944. The assesse therein contended that explosives used in the mining operation must be regarded as inputs. The Tribunal came to the conclusion that as the inputs (explosives) had not been brought into the factory and had been used in the mines outside the factory are not eligible for credit. The Hon’ble Apex Court held that even in respect of inputs used in the manufacture of intermediate product, which product is then used for manufacture of a final product (Cement) the credit is eligible. The issue in the case on hand is not on the eligibility of credit on explosives, and not applicable.
In the case of VIKRAM CEMENT VERSUS COMMISSIONER OF CENTRAL EXCISE, INDORE [2006 (1) TMI 130 - SUPREME COURT] the question that was considered was again the eligibility of credit on explosives used in captive mines. The Hon’ble Apex Court held that the credit would be eligible and that the decision in the case of M/s.Jaypee Rewa Cement would apply. It was also held that CENVAT Rules in effect substituted the Modvat Rules. The issue on hand is not eligibility of credit on explosives used in captive mines, and therefore not applicable.
Time Limitation - Penalty - HELD THAT:- The appellant had periodically filed returns and disclosed the credit availed by them. Further, the demand has been raised on the basis of the accounts maintained by the appellant. The appellant has maintained proper delivery challans and documents for the amount of lime stone stock transferred. There is no positive act of suppression established by the department. Further, the department for the period 1/2017 to 6/2017 has set aside the demand interpreting the issue in favour of appellant - there are no grounds for invoking the extended period. The issue on limitation is answered in favour of appellant and against the Revenue - Being stock transfer of limestone to appellant’s own units, and also of interpretational nature, the penalties are to be set aside entirely. The appellant is liable to pay duty along with interest for the normal period.
The impugned order is modified to the extent of upholding the demand and interest for the normal period only. The penalties for normal period is set aside - The appeal is partly allowed.
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2024 (2) TMI 1185
Maintainability of appeal - all the issue related to question of fact - Clandestine removal - Whether CESTAT has erred in not appreciating the suppression of production arisen on calculating annual electricity consumption which shows that there was excess production of excisable goods as compared to the productions reflected in their statutory records?
HELD THAT:- All the questions which the appellant has raised in the present appeal, are essentially questions of fact and there is no question of law as such which is required to be adjudicated by this Court.
Taking into consideration the concurrent findings of fact, this appeal need not be entertained.
The appeal stands dismissed.
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