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Central Excise - Case Laws
Showing 301 to 320 of 80410 Records
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2024 (2) TMI 815 - CESTAT HYDERABAD
CENVAT credit - capital goods installed in the distillery plant used for manufacture of Ethyl Alcohol - period from June 2011 to June 2012 - Erection, Commissioning & Installation services as input services availed after 01.04.2011 for setting up and installation of the distellery plant - exemption under Notification No. 67/1995-CE dt.16.03.1995 on the molasses consumed captively to manufacture Ethyl Alcohol - Requirement to pay an amount equal to 6% of value of the exempted goods in terms of Rule 6(3)(i) of Cenvat Credit Rules, 2004 [CCR, 2004] under Rule 14 read with Sec 11A of the Central Excise Act, 1944 - levy of interest and penalty.
Whether the Appellant is entitled to Cenvat credit on the capital goods installed in the distillery plant used for manufacture of Ethyl Alcohol during the period from June 2011 to June 2012? - HELD THAT:- While it is true that in the process of manufacture of the excisable goods, viz, denatured Alcohol, Ethyl Alcohol, which is otherwise not chargeable to central excise duty arises at an intermediate stage, and the last step of denaturing takes place in tankers itself. The manner in which the goods have left the factory is what matters with respect to central excise duty, whether it is a question of payment of central excise duty or the admissibility of CENVAT credit on the capital goods, inputs or input services. There is no good reason as to why the Cenvat credit on capital goods used in the distillery should be denied to the Appellant - neither the factor that an exempted good, viz, Ethyl Alcohol comes into existence prior to the manufacture of denatured Alcohol nor the fact that denatured Alcohol is not produced within the distillery machines, but in the tankers within the factory, should make any difference to the entitlement of Cenvat credit. Nothing in the CCR determines the eligibility of CENVAT credit based on at what stage the final goods become liable to central excise duty, and so long as the goods which are cleared from the factory are excisable goods, CENVAT credit on the capital goods cannot be denied.
Revenue relied on the decision of Division Bench of this Tribunal in RAI BAHADUR NARAIN SINGH SUGAR MILLS LTD VERSUS COMMISSIONER OF CENTRAL GST, DEHRADUN [2023 (11) TMI 1163 - CESTAT NEW DELHI] to assert that no Cenvat credit can be given on capital goods used in the manufacture of a distillery unit. We have examined the decision in Rai Bahadur Narain Singh Sugar Mills. The facts in that case were different. The Assessee in that case was entitled to an Area based exemption notification, which it availed and hence it would not have been entitled to CENVAT credit on captial goods - In this case, there is no exemption for denatured Alcohol and CO2 manufactured by the Appellant from duty and there is no dispute that duty was liable to be paid and was paid. Since the present case is different on facts, we find that the decision relied upon by the Revenue will not come to its rescue.
Whether the Appellant is entitled to Cenvat credit on the Erection, Commissioning & Installation services as input services availed after 01.04.2011 for setting up and installation of the distellery plant? - HELD THAT:- This Bench held in PEPSICO INDIA HOLDINGS (PVT.) LTD. VERSUS COMMISSIONER OF CENTRAL TAX, TIRUPATI [2021 (7) TMI 1094 - CESTAT HYDERABAD] that after 01.04.2011, although the services rendered in relation to installation and commissioning of the plant were not in the inclusive part of the definition but they were not excluded either and the main part of the definition of input service is broad enough to include the input services used in setting up and installation of the plant and machinery and hence CENVAT credit is admissible - the Appellant is entitled to Cenvat credit on the inputs used in setting up the plant and machinery.
Whether the Appellant is entitled to claim exemption under Notification No. 67/1995-CE dt.16.03.1995 on the molasses consumed captively to manufacture Ethyl Alcohol? - HELD THAT:- There are no strong force in the submission of the learned Counsel that the adverse report of the Range Superintendent obtained after the Hearing was over, cannot be relied upon unless a copy is served upon the Appellant and it is given an opportunity to defend. The only matter of fact to be determined is if the appellant had fulfilled the requirements under Rule 6 of CCR or not. In view of the above, it is found that it is a fit case to be remanded to the Commissioner on this question, with a direction to provide or send a copy of the report of the Range Superintendent to the appellant and after giving the appellant sufficient opportunity to rebut the report and explain how it had fulfilled the obligation under Rule 6 of CCR, and pass a reasoned order after following principles of natural justice.
Whether the Appellant is required to pay an amount equal to 6% of value of the exempted goods in terms of Rule 6(3)(i) of Cenvat Credit Rules, 2004 [CCR, 2004] under Rule 14 read with Sec 11A of the Central Excise Act, 1944? - HELD THAT:- In M/S TIARA ADVERTISING VERSUS UNION OF INDIA MINISTRY OF FINANCE DEPARTMENT OF REVENUE [2019 (10) TMI 27 - TELANGANA AND ANDHRA PRADESH HIGH COURT], it has been held by the Hon’ble High Court that the obligations under Rule 6(1) or Rule 6(2) or Rule 6(3) are various options given to the assessee and it is not for the Department to choose an option for the Assessee. If the assessee does not follow any of the options and fulfill its obligations, demand can be raised to deny the entire amount of Cenvat credit, but the assessee cannot be forced to pay an amount equal to 6% under Rule 6(3)(i) of CCR, 2004. Therefore, the demand equal to 6% of the value of exempted goods sold, under Rule 6(3) of CCR, 2004, cannot be sustained and needs to be set aside.
Appeals are partly allowed and partly remanded.
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2024 (2) TMI 814 - CESTAT ALLAHABAD
Compounding of duty - unsealing of one pouch making machine or not - one pouch packing machine that was installed in separate room as per the ground plan and used for packing sweet supari - HELD THAT:- No evidence has been produced by the revenue to establish that this machine was being used for packing Gutkha. All the evidences produced in form of declaration, ground plan and correspondences show that this machine was installed in the separate room and was used only for the purpose of packing sweet supari. Accordingly, there are no merits in the impugned order to that extent. It demands duty contrary to the declaration filed along with the ground plan, which is required in terms of Pan Masala Packing Machines (Determination of Capacity and Collection of Duty) Rules, 2008.
Appeal allowed.
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2024 (2) TMI 813 - CESTAT CHANDIGARH
Availment of inadmissible self credit of Education Cess and S&H Education Cess in contravention of para 2C of the Notification - recovery alongwith interest and penalty - HELD THAT:- The identical issue was considered by this Tribunal in the case of M/S ALU BOND ENTERPRISES VERSUS THE COMMISSIONER OF CENTRAL EXCISE AND SERVICE TAX, JAMMU & KASHMIR [2023 (12) TMI 1290 - CESTAT CHANDIGARH], wherein the Division Bench of this Tribunal has held The impugned order cannot be sustained and is accordingly set aside.
Since the issue is no more res integra and this Tribunal in the above cited case has held that the impugned order is not sustainable in law; therefore, by following the ratio of said decision in the above cited case, it is held that the impugned order is not sustainable and the same is set aside by allowing the appeal of the appellant - appeal allowed.
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2024 (2) TMI 769 - SC ORDER
Maintainability of SLP - Low tax effect - SSI exemption - dummy units - it was held by High Court that without issuing the SCN to the other units, the clearance of those units could not be combined with that of the Respondent - HELD THAT:- In view of the low tax effect, it is not required to interfere with the impugned judgment passed by the High Court.
The Special Leave Petitions are dismissed.
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2024 (2) TMI 768 - CESTAT AHMEDABAD
Distribution of input service credit by the Principal manufacturer to its Contract Manufacturing Units (Job workers) - permitting distribution of credit by principal manufacturer to its job workers is correct or not - Job worker i.e. Sweety Industries were manufacturing biscuits under the brand names belonging to Principal Manufacturer - duty paid by job worker in Parle Biscuits retail sale price (MRP) less permissible abatement u/S 4A of CEA - Job worker’s factory was dedicated for Parle Biscuits and was an extended factory of Parle, manufacturing biscuits under Notification No. 36/2001- CE (NT) dated 26.06.2001 - amendment to Rule 7, CCR was clarificatory in nature or not - conscious or deliberate suppression of facts or mis-statement on the part of the Appellants or not - invocation of Extended period of limitation.
HELD THAT:- All the issues involved in the present case have been answered by the larger bench in the case of M/S. KRISHNA FOOD PRODUCTS, M/S. MARIAMMA R. IYER, M/S. PARLE BISCUITS PVT LTD. VERSUS THE ADDITIONAL COMMISSIONER OF CGST & C. EX [2021 (5) TMI 906 - CESTAT NEW DELHI] where it was held that It would not be necessary to answer the issue that whether the appellant would, irrespective of the answer to the first issue, be entitled to avail CENVAT credit when input service is attributed to the goods on which excise duty is paid and includes the cost of services on which credit was taken.
From the above judgment, it can be seen that the issue involved in the present case has been settled in favour of the assessee. Accordingly, the impugned order in the present case is also not sustainable.
The impugned order is set aside. Appeals are allowed.
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2024 (2) TMI 767 - CESTAT BANGALORE
Classification of micronutrient fertilizers - Presence of nitrogen as a chelating agent - essential constituent - Analysing implementation of the observation/direction of the Hon’ble Supreme Court [2008 (5) TMI 14 - SUPREME COURT] in remanding the case for deciding the classification of the products viz. micronutrients - classifiable under Chapter Heading 3105 of Central Excise Tariff Act, 1985 or under chapter sub-heading 3808.20 of CETA, 1985? - Extended period of Limitation - HELD THAT:- The adjudicating authority, pursuant to the remand, commenced the de novo proceeding by appointing a Committee of Officers to examine the process of manufacture of the impugned products and submit their report accordingly. The Committee comprising of two Superintendents visited the factory of the Appellant, examined the process of manufacture and submitted their report to the Commissioner on 08.5.2009.
Based on the said legal advice/opinion, the Commissioner himself visited the factory premises of the appellant on 16.12.2009 and examined the process of manufacture of the impugned products - The procedure adopted by the learned Commissioner in carrying out the direction/observation of the Hon’ble Supreme Court, in the denovo proceeding has been assailed by the appellant.
The Ld. Commissioner while analyzing the said allegations of the appellant held that since his predecessor after receiving the report of the Committee of officers neither commented nor recorded his opinion on the report, therefore, with a change of adjudicating authority, a reference was made to the departmental standing counsel seeking legal opinion on delegation of the task of examination of method of manufacture to the Committee of officers. The opinion of the learned Standing Counsel was that constitution of a Committee without express permission of the Hon’ble Supreme Court would be ultra vires of the direction of the apex court.
It is found that reading the Committee”s Report on the process of manufacture and that of recorded by the Ld. Commissioner after visit to the factory premises of the appellant, we do not see any material difference on the facts. What is noticed is that in addition to stating the process of manufacture, the committee of officers in its report proceeded further by interpreting the order of the Hon’ble Supreme Court, applicability of Note 6 of Chapter 31 and Circular dated 19.5.1998 observing that the goods are rightly classifiable under Chapter 31.05 and the products may not be called as “Plant Growth Regulator.
Their Lordships analysing the scope of the terms micronutrient, PGR and other fertilizers, in the backdrop of rival claims, observed that admittedly nitrogen is present as a chelating agent, not as a fertilizing agent; even if it is a fertilizing agent, would not amount to an essential constituent under explanatory note 6 of chapter 31.
In the de novo proceeding, the learned Commissioner after verifying the process of manufacture held that it is purely a physical process of mixing of various constituents; the Nitrogen which is added in the form of urea does not undergo any chemical reaction with any of the constituent of the impugned product, it remains as it is, therefore, adding the same at the beginning or at the end of the process of physical mixing would not make any difference. Accordingly, he has concluded that the process of mixing undertaken by the appellant could not lead to their claim that adding Nitrogen containing chemical urea converts PGR into nutrient falling under Chapter 31.05.
The said finding of the Ld. Commissioner answers/satisfies the question raised by the Hon’ble Supreme Court in remanding the case to ascertain whether process of manufacture would demonstrate the presence of “Nitrogen” as an essential constituent though present as a “chelating agent”.
The finding of the Ld. Commissioner that the impugned goods merit classification under CSH 3808.20 (38089340) of CETA, 1985 upheld - confirmation of demands with interest is also upheld. Since the issue relates to classification and interpretation of law, imposition of penalty under Rule 25 on the company and personal penalty under Rule 26 CER, 2002 on the Appellant Shri Mahesh G Shetty is unwarranted and accordingly set aside.
Appeal allowed in part.
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2024 (2) TMI 727 - CESTAT CHENNAI
Valuation - MRP based value u/s 4A or transaction value u/s 4 - Extended period of limitation - package of MCCBs cleared to industrial/institutional consumers - requirement to affix MRP on the Product MCCB as per the Standards of weights and Measures (packaged Commodities) Rules, 1977 or not for clearances effected to industrial and institutional customers through their dealers and depots - existence of machinery provisions available to determine the MRP for the product or not - list price can be adopted to determine MRP as per the Rule 4(a)(ii) of Central Excise (Determination of Retail Sale Price of Excisable Goods) Rules, 2008 or not?
HELD THAT:- The impugned SCN has been issued on 11.05.2012 for the period from 01.04.2007 to 27.05.2008. The entire issue has arisen because of change of opinion due to differing legal interpretations. The Appellant has contended that he was under the bonafide belief that there was no requirement to affix MRP on the switchgear products sold by them industrial/institutional consumers through their dealers and these were exempted under the Packaged Commodity Rules, 1977. Moreover, it is an admitted fact that they were affixing a sticker on their own on the packages of their products that they are “Specially packed for the exclusive use of an industry as a raw material or for the purpose of servicing any industry, Mine or quarry for industrial use only and not intended to be displayed for sale at a Retail Outlet. Hence, it is to be noted that there is no mis-declaration by the Appellant to intentionally evade payment of duty.
The Appellants have been issuing invoices under Rule 11 of Central Excise Rules and periodically filing ER 1 returns disclosing the value adopted for the clearances and it is not the case of deliberate and wilfully evading payment of duty and hence the proviso to Section11 A(1) is not invokable and hence the penalty imposed under Section 11 Ac will not sustain.
In fact the impugned order has not adduced any evidence on the above allegation and the intention to evade payment of duty due to any contraventions of the provisions of the Act has not been well brought out - the Show Cause Notice is barred by limitation and hence the demand will not survive.
The appellant succeeds on limitation. The appeal is thus allowed with consequential relief.
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2024 (2) TMI 726 - CESTAT ALLAHABAD
Valuation - inclusion of insurance charges recovered in excess from the customers - HELD THAT:- The issue is not more res integra and has already been decided by the Hon’ble Supreme Court in the case of BARODA ELECTRIC METERS LTD. VERSUS COLLECTOR OF CENTRAL EXCISE [1997 (7) TMI 126 - SC ORDER], wherein the Hon’ble Supreme Court held the excess amount represents profit element. Once this is so, the same cannot be subjected to excise duty inasmuch as the duty is leviable on manufacture of goods and not on profit.
The impugned order set aside - appeal allowed.
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2024 (2) TMI 725 - CESTAT ALLAHABAD
Valuation of goods - manufacture of M.S. Fabricated Hot Dip Galvanized Steel Structures (Tower) - non-inclusion of freight chaged from their buyers in the transaction value in terms of Section 4(3)(d) of the Central Excise Act, 1944 - HELD THAT:- The price of goods depends upon the transaction value of goods and the element of freight has no bearing whatsoever on the value of goods. It is the case of the Department that the excess of transportation (Freight Element) of the excisable goods from the factory to the buyer’s premises was liable to be included in the assessable value of the goods for computation of duty. Further, in the delivery terms, it is mentioned freight at actual. Accordingly, the place of removal is the factory gate and not the premises of the buyers - the issue is no more res integra and is covered by the decision of this Bench in the case of M/S FLAKTWOODS ACS (INDIA) PVT. LTD. VERSUS COMMISSIONER OF CENTRAL EXCISE & S.T., NOIDA-II [2016 (9) TMI 1173 - CESTAT ALLAHABAD] where it was held that the, transfer of ownership takes place at the factory gate when the goods are delivered. Therefore, the ld. Commissioner have erred in holding that the goods manufactured and cleared by the appellant, shall not be valued under Section 4(1)(a) but under Section 4(1)(b).
As per Rule 5 of the Central Excise Valuation (Determination of Price of Excisable Goods) Rules, 2000- wherein excisable value of goods are sold in the circumstances specified in clause (a) of sub-section (1) of Section (4) of the Act, except the circumstances in which the excisable value of goods are sold for delivery at a place other than the place of removal, then the value of such excisable value shall be deemed to be the transaction value, excluding the cost of transportation from the place of removal up to the place of delivery of such excisable goods.
The Respondent had arranged for the transport of goods to buyer’s addresses and the freight charges were mentioned separately in the invoices. The goods after manufacturing in the plant of the Respondent were subject to pre-delivery inspection by the buyer and were ascertained in favour of the particular buyer before the delivery. In the invoices, the Respondent have charged sales tax and have reflected freight separately in most of the cases. The transfer of ownership takes place at the factory gate when the goods are delivered.
There are no reasons to interfere with the impugned Order-in-Appeal passed by the learned Commissioner (Appeals) and the same is sustained - appeal of Revenue dismissed.
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2024 (2) TMI 669 - CESTAT ALLAHABAD
Recovery of interest on the wrongly availed credit - penalty under Rule 15 of the Cenvat Credit Rules, 2004 - HELD THAT:- The issue involved in the present case is squarely covered by the decision of Hon’ble Supreme Court in the case of M/s Ind-Swift Laboratories Ltd. [2011 (2) TMI 6 - SUPREME COURT] following has been held Rule 14 specifically provides that where CENVAT credit has been taken or utilized wrongly or has been erroneously refunded, the same along with interest would be recovered from the manufacturer or the provider of the output service. The issue is as to whether the aforesaid word "OR" appearing in Rule 14, twice, could be read as "AND" by way of reading it down as has been done by the High Court. If the aforesaid provision is read as a whole we find no reason to read the word "OR" in between the expressions `taken' or `utilized wrongly' or `has been erroneously refunded' as the word "AND". On the happening of any of the three aforesaid circumstances such credit becomes recoverable along with interest.
It is quite evident that the N/N. 18/2012-CE (NT) clearly provides the date from which the word “or” has been substituted in Rule 14 of The CENVAT Credit Rules, 2004. It is unambiguously provided that the substitution is being made from 17th March 2012, and no retrospective effect has been given to the said amendment/ substitution - It is settled position in law that physical statute need to be interpreted in a literal sense on the basis of what have been stated in the law or statute. There is no room for indictment or according to any beneficial construction to the appellant/assessee.
It is also settled law that interest is a statutory/ contractual liability for the wrongly taken credit or is equivalent to the time value of the money/credit. It is an absolute liability as has been held by the courts in the various decisions for the same no person could claim the benefit and claim that interest as provided by the statute could not have been recovered as has been held the same is barred by limitation. It was for the appellant to have paid the interest along with the reversal of the excess credit taken. It is also observed that during the period of dispute section 11A did not provided, for recovery of interest and hence was not applicable. The recovery of interest was made in terms of Section 11AB/ 11AA which did not provided for any limitation.
As the demand made within the period of five years for recovery it is upheld, there are no merits in the submissions made for not imposition of the penalties imposed under Rule 15, in view of the decision of the Hon’ble Apex Court in the case of Rajasthan Spinning and Weaving Mills Ltd [2009 (5) TMI 15 - SUPREME COURT].
There are no merits in the appeal filed by the appellant - appeal dismissed.
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2024 (2) TMI 668 - CESTAT CHANDIGARH
Entitlement for interest on the refund sanctioned - change of opinion of the Court in a subsequent matter of another party would give any leverage to the appellants to re-open the decision which has attained finality or not.
Appellants argues that interest is a natural corollary of the refund granted and the rights of the appellants cannot be taken away for the reason that the Hon’ble Apex Court has overturned the decision in M/S. SRD NUTRIENTS PRIVATE LIMITED VERSUS COMMISSIONER OF CENTRAL EXCISE GUWAHATI [2017 (11) TMI 655 - SUPREME COURT] vide their decision in the case of M/S. UNICORN INDUSTRIES VERSUS UNION OF INDIA & OTHERS [2019 (12) TMI 286 - SUPREME COURT].
HELD THAT:- It is found that consequent to the passing of judgment by the Hon’ble Supreme Court in the case of M/s Unicorn Industries, the Department has raised a number of demands on the refunds already granted to various assessees; Hon’ble High Court of Jammu & Kashmir in the case of COMMISSIONER OF CGST AND COMMISSIONER OF CENTRAL EXCISE, J&K, JAMMU VERSUS NARBADA INDUSTRIAL BARI BRAHMANA JAMMU [2021 (10) TMI 1426 - JAMMU & KASHMIR AND LADAKH HIGH COURT], has held that the change of opinion of the Court in a subsequent matter of another party would not give any leverage to the appellants to re-open the decision which has attained finality.
If the Department is barred from raising demands for the refunds already granted, the appellants also cannot seek interest on the refunds already granted. It is further found that CBEC clarified vide Circular No.682/73/2002-CX dated 19.11.2002 that the provisions of Section 11B of the Central Excise Act, 1944 are not applicable in the case of Exemption Notifications No.56/2002 and No. 57/2002 both dated 14.11.2002. The findings of the learned Commissioner (Appeals) that the mechanism of refund has been put in place in order to operationalize the exemption contained in the notifications and to the extent, refunds arising out of these notifications cannot be considered to be refunds under Section 11B of the Central Excise Act, 1944, is agreed upon.
The appellants have not made out any case for grant of interest - Appeal rejected.
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2024 (2) TMI 667 - CESTAT MUMBAI
Denial of CENVAT Credit - services provided to the employee for transportation to and fro the workplace by bus, provision for canteen services, Mathadi services - denial on the ground that there was no statutory requirement/obligation to provide those services - HELD THAT:- On renovation of executive toilets and housekeeping of administrative building, the denial was on account of the fact that those were not used by the workmen nor having any nexus to the manufacture of final product and on denial of professional fee as well as maintenance of canteen building, no reason is assigned by the leaned Commissioner. This being the observation of the Commissioner on record, it is apparently cleared that he has accepted only the core work including laborious activities undertaken during the production process and excluded all other ancillary and incidental activities that go with the manufacturing process and form its integral part.
Be that as it may, when all these services are specifically held by this Tribunal and confirmed by the Appellate Courts like Hon'ble High Courts and Hon'ble Supreme Court to be valid inputs for the purpose of manufacture, there is no reason for us to depart from the judicial precedent set by this Tribunal when they themselves are integral part of manufacture process for which these services availed by the Appellant can be said to be valid input services against which credit are admissible.
The order passed by the Commissioner of Central Excise, Thane-II is hereby set aside - Appeal allowed.
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2024 (2) TMI 666 - CESTAT MUMBAI
Taxability - Excisable goods or not - waste and scrap namely paper/paper boards, corrugated boxes, aluminium foils etc., arose during manufacturing of cigarettes - HELD THAT:- Section 2(d) provides the definition of excisable goods and its explanation on “goods” includes any article, material or substance which is capable of being bought or sold for a consideration and such goods shall be deemed to be marketable but the starting lines of the Central Excise Act, 1944 says that “the Act is passed to consolidate and amend the law relating to Central Duties of Excise as it was expedient to consolidate and amend the law relating to Central Duty of Excise on goods manufactured or produced in certain parts of India” - Taking both the provisions together, it has been consistently held by the Court of law that to levy duty of Excise, both manufacturing and marketability conditions are required to be fulfilled and the same view continues even after proviso is introduced in Section 2(d).
It has also been consistently held even by the Hon'ble Supreme Court that waste and scrap, in West Coast Industrial Gases Ltd. (Res.) [2003 (4) TMI 110 - SUPREME COURT] and also in respect of bagasse and other waste products, DSCL Sugar Ltd. case [2015 (10) TMI 566 - SUPREME COURT] are not excisable articles on which duty liability can be fastened.
The following order in order to maintain consistency and predictability to the order passed by this Tribunal and to carry forward the judicial precedent set by it - Appeal allowed.
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2024 (2) TMI 665 - CESTAT MUMBAI
Refund of the excess amount that was subsequently refused to be paid to the Appellant by the Refund Sanctioning Authority - Finalization of provisional assessment - Sale through C & F Agents/Depot/Consignment agent - Appellant failed to discharge the burden of Unjust Enrichment - HELD THAT:- The refundable amount accrued in favour of the Appellant was on account of duty paid by it while making temporary clearance from the depot under Rule 7 and the duty actually received from the customers at the time of sale and clearance of goods to them. There is no dispute that the actual discount or sale at a lesser price was not extended to the customers since, the Assistant Commissioner has noted in his findings at Para 5 that Superintendent had verified the reports and statements concerning clearance of goods at the factory gate and at the C & F Agents and submitted his report that discounts were actually passed on by the C & F Agents to the dealers, as indicated in their invoices. This being so, the entire amount of excess payment of duty can be considered as borne by the Appellant alone, since duties from the customers/ dealers were actually realized at C & F Agents end and paid to the department.
In such fulfilment of the procedural requirement there would be hardly any scope that Appellant would be able to collect duty element separately from its customers & dealers to compensate the duties paid by it at the ex-clearance from the factory gate. It is apparently keeping these provisions in mind, the provision of refund of differential duty after financial assessment is codified in Rule 7 itself, in which Department would have refunded the amount on its own without any refund application being filed under Section 11(B) of the Central Excise Act, 1944 and burden of examination of passing/non-passing of duly element would have been done by itself.
Having regard to the fact that this is a case where refund should have been granted immediately upon final assessment, the following order is passed - Appeal allowed.
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2024 (2) TMI 614 - CESTAT CHANDIGARH
Classification of goods - scrap-veg-refuse - classifiable under Chapter Heading 23080000 as vegetable waste as claimed by the Appellant or potato starch classifiable under Chapter Heading 1108 as claimed by the Department? - HELD THAT:- The HSN explanatory notes clearly provide that the potato starch falling under Chapter Heading 1108 shall be physically in white powdered form, however, in the present case, the ‘scrap-veg-refuse’ is physically in the form of a wet paste. It is seen that the only reason for upholding demand against the Appellant No.1 is on the basis that the said ‘scrap-veg-refuse’ has starch contents in it. Here, it is noted that just because the product has some starch contents does not qualify it as potato starch classifiable under Chapter Heading 1108. It has been held by the Tribunal in the cases cited supra that mere presence of certain elements of starch in the residue or scrap does not take it out of the purview of a waste or residue and the Department has to bring sufficient evidence to establish that the said product is not residue or waste.
The impugned goods is not a manufactured product as per Section 3(1) of the Central Excise Act, 1944, which mandates that excisable goods must come into existence as a result of manufacturing process so as to attract the levy of excise duty; whereas in the present case, ‘scrap-veg-refuse’ came into existence pursuant to process of recycling of waste water, undertaken only to reuse the reusable water content in the waste water - further, test report of Central Revenue Control Laboratory produced by the Revenue, is not conclusive as it only states that the sample tested positive for starch without going into the details of the composition of the sample and has not given any conclusive proof.
The impugned orders are not sustainable in law and therefore, are set aside - Once, the demand itself is set aside, the question of interest and penalties on the Appellant No.1 and Appellant No.2 does not arise - appeal allowed.
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2024 (2) TMI 613 - CESTAT NEW DELHI
CENVAT Credit - duty paying documents - existence of cause of action or not - credit availed on the strength of supplementary invoices issued by the supplier as per Rule 9(1) (b) of the CENVAT Credit Rules, 2004 - fraud, collusion or wilful misstatement or suppression of facts or not - HELD THAT:- The entire cause of action against the appellant herein being that the supplementary invoices were issued by NEI in respect of the duty short paid by reason of fraud, collusion, wilful misstatement or suppression of facts. Once the order against NEI has been set aside by this Tribunal, nothing survives to support the allegations in the SCN, the Order in Original or the impugned order in this appeal.
The impugned order, therefore, needs to be set aside as the cause of action no longer exists and the appellant had correctly availed CENVAT credit on the strength of the supplementary invoices issued by NEI.
The impugned order is, accordingly, set aside - Appeal allowed.
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2024 (2) TMI 612 - CESTAT KOLKATA
Interest on delayed Refund - Interpretation of the term “relevant date,” - Relevant date, whether having a bearing with the date of the order, permitting the refund or the date of filing of the application - HELD THAT:- Section 11 BB, does not talk or uses the phraseology “relevant date,” what it alone speaks is “the date of receipt of application under subsection (1)” of Section 11B. The term relevant date is made use of in Section 11B and that too, in the context of the limitation for making of such an application for filing of a refund claim and provides for a series of situations like export of goods, goods returned for certain specified reasons, etc. or even situations not pertaining directly to manufacturers, provisional payments of duty, judicial ruling and the like. The usage of the term “relevant date” therefore, does not have any impact with reference to the date of proclamation of the admissibility of the refund claim. It is therefore obvious that what clause (ec) of Section 11B refers to, is only to enhance the limitation period, to a case where the duty becomes payable as a result of an order of the court or a direction from the appellate authority - there are no merit in the said interpretation of the learned Commissioner (Appeals).
The Hon’ble Gujarat High Court in the case of Kamakshi Tradexim (India) Pvt. Ltd. Vs. Union of India [2017 (4) TMI 223 - GUJARAT HIGH COURT]. clearly held that the liability of the department to pay interest in terms of Section 11BB, of the Central Excise Act commences from date of expiry of three months from the date of receipt of application for refund under Section 11B(i) of the act ibid - It is found that appellant is entitled to payment of interest, three months from the date of the refund application made by them.
The appeal filed by the assessee/appellant is allowed, who shall be entitled for payment of interest three months from the date of refund applications - the order of the lower authority is set aside - Appeal allowed.
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2024 (2) TMI 563 - CESTAT AHMEDABAD
Levy of penalty - Suppression of facts or not - appellant have paid the amount of proportionate credit of input and input services attributed to the exempted goods or not - non-following the procedure as laid down under Rule 6 (3) (1)/(2)/3A of Cenvat Credit Rules, 2004 nor reversal of any credit utilized for manufacture of exempted goods - HELD THAT:- The fact regarding manufacture and clearance of dutiable as well as exempted goods and availment of credit on the entire input and input services commonly used for manufacture of dutiable and exempted goods is very well on record and known to the department. Accordingly, there is no suppression of fact on the part of the appellant. Hence, the entire demand is prima-facie time bar. However, the appellant have admittedly paid the amount of Rs. 60,15,116/- and they are only contesting the penalty.
Though the demand is prima facie time bar but since the appellant have admittedly paid and not contesting such payment, the demand to the extent of Rs. 60,15,116/- is upheld and payment made thereof by the appellant is maintained. However, the appellant is not liable for any penalty.
The penalty is set aside. Needless to say that since the appellant have paid the amount of 60,15,116/- which is proportionate Cenvat credit attributed to the exempted goods belatedly, they are liable to pay the interest till the date of reversal - Appeal allowed in part.
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2024 (2) TMI 562 - CESTAT ALLAHABAD
Recovery of short paid service tax alongwith interest and penalty - Maintenance or Repair Service and Erection, Commissioning & Installation Services - wrong availment of abatement under the category of Erection, Commissioning and Installation Services and Construction Services in respect of Commercial or Industrial Buildings and Civil Structures - wrong availment of Cenvat credit on improper invoices which were not addressed to their registered account - penalty.
Short payment of service tax under the head of Maintenance or Repair Service and Erection, Commissioning & Installation Services - HELD THAT:- The issue involved in the present case is only vis-à-vis production of the documents showing the receipt/non-receipt of the amount against which the demand of Rs.4,44,939/- has been made - the said documents also not found to be available in the appeal file - one opportunity granted to the appellant to produce all these documents before the Original Authority for consideration and if satisfied that any part of the amount against which service tax has been demand, have not been received by the appellant to allow him the benefit of the same - matter on remand.
Short payment of service tax to the tune of Rs.1,20,094/- by way of wrong availment of abatement under the category of Erection, Commissioning and Installation Services and Construction Services in respect of Commercial or Industrial Buildings and Civil Structures - HELD THAT:- As the appellant failed to establish that claim for exemption under the notification no 1/2006-ST, the demand made by denying abatement for determination of taxable value for the levy of service cannot be faulted with - demand upheld.
Short payment of service tax to the tune of Rs.69,864/- by way of wrong availment of Cenvat credit on improper invoices which were not addressed to their registered account - HELD THAT:- The issue in this regard is no longer res integra and the Tribunal/Courts have decided that for claiming the benefit of input services, it is not necessary that invoices be addressed to the registered premises of the appellant - reliance can be placed in mPortal India Wireless Solutions P. Ltd. [2011 (9) TMI 450 - KARNATAKA HIGH COURT] - there are no merits in the impugned order seeking to deny the Cenvat credit on this ground.
Penalty - HELD THAT:- Penalties imposed on the appellant need to be re-determined by the Original Authority on the basis of his findings on the issues for which the matter is remanded back to the Original Authority.
Appeal is partly allowed - part matter on remand.
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2024 (2) TMI 561 - CESTAT CHANDIGARH
Refund of Education Cess and S&H Education Cess paid through PLA - appeal rejected on account of non deposit of mandatory pre-deposit - HELD THAT:- The Parallel proceedings for recovery of the self-credit/refund erroneously taken by the appellant in respect of Education Cess and S&H Education Cess during the overlapping period, were adjudicated by the original authority as well as by the appellate authorities of the department and appellant was asked to deposit an amount of Rs. 22,69,936/-. Thereafter, the CESTAT vide its Final Order [2018 (10) TMI 2020 - CESTAT CHANDIGARH] held that the appellant is entitled to take the refund of Education Cess and S&H Education Cess in view of the judgment of the Hon’ble Supreme Court in the case of SRD Nutrients Pvt. Ltd. [2017 (11) TMI 655 - SUPREME COURT] - It is also found that pursuant to CESTAT’s Order dated 25.10.2010, the appellant duly applied for refund of the amount so deposited and was granted by the original authority vide its order dated 11.03.2019 wherein the Original authority has also observed that the appellant is entitled for refund of Education Cess and S&H Education Cess and by following the decisions of the CESTAT, the Original authority has rightly granted the refund.
The High Court has stated that the decision in SRD Nutrients (P) Limited [2017 (11) TMI 655 - SUPREME COURT] had attained finality and was binding on the parties thereto. Therefore, the subsequent decision of this Court overruling SRD Nutrients (P) Limited in the case of M/s Unicorn Industries [2019 (12) TMI 286 - SUPREME COURT] cannot have a bearing on past decisions which had attained finality although they had followed SRD Nutrients (P) Limited, which was subsequently overruled in M/s Unicorn Industries. Otherwise a pandora's box would be opened and there would be no end to litigation, which is against public policy.
In view of the above, the appellant is entitled to the refund of Education Cess and S&H Education Cess and the said order has been complied with by the Revenue.
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