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Central Excise - Case Laws
Showing 61 to 80 of 302 Records
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2014 (1) TMI 1383
Denial of refund claim - Availment of modvat credit - Notification No.6/2000-CE - Whether the assessee passed on the incidence of duty paid by them on tubes and tyres to their customers as provided for under Section 12-B of the Central Excise Act, 1944 - Held that:- no efforts of whatsoever nature were made by the assessee in producing the additional materials/evidence before the Tribunal after the order of remand passed by this Court and confirmed by the Supreme Court. The Tribunal, therefore, did not have additional evidence/material before it to consider the claim of the assessee and in view thereof and for the reasons recorded in the impugned order held that the evidence on record is not sufficient to show that the incidence of Central Excise Duty paid on tyres and tubes, which were used in the manufacture of all four models of vehicles by the assessee, was passed on to its customers.
It is necessary for the assessee who is seeking refund as contemplated by Section 11B of the Act to satisfy two conditions/circumstances namely that the applicant should be entitled for refund, and secondly, that the incidence of duty had not been passed on to the customers. While examining whether these conditions are satisfied it is necessary to bare in mind the deeming fiction in Section 12B of the Act. In the present case, it is not in dispute that the first condition stands satisfied. Therefore, what remains for us to examined is whether the incident of excise duty was passed on to the customers.
Merely because, the assessee sold the vehicles at loss would not mean that the incidence of duty had not been passed on to the customers, more particularly, when the invoices issued to the customers admittedly had indicated the excise duty forming part of the price at which the vehicles were sold. If at all, the assessee suffered loss, it is clear, they suffered loss on their goods and it cannot be stated that excise duty paid by assessee was not passed on to the customers - Decided against the assessee.
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2014 (1) TMI 1341
Waiver of the predeposit - Confiscation of goods - Imposition of penalty - Whether the impugned oder dated 13.5.2013 passed by the Tribunal is correct in law by directing the appellant to deposit Rs.38,00,000/- when the appellant has a strong prima facie case on merits as well as financial hardship - Held that:- Following decision of M/s. L.G. Electronics India Pvt. Ltd. Versus Commissioner of Central Excise, Noida [2009 (6) TMI 29 - ALLAHABAD HIGH COURT] - Decided in favour of assessee.
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2014 (1) TMI 1340
Rejection rebate claim due to export - Interpretation of notification - Non fulfillment of procedure prescribed in Notification No. 19/2004-C.E.(N.T.) dated 06.09.2004 issued under Rule 18 of Central Excise Rules, 2002 - Rejection of benefit of notification dated 06.09.2004 - Held that:- provision has been made for the benefit of exporter but simultaneously, it also cannot be overlooked that the Government of India has also to lay down the procedure which will discourage mischievous and scrupulous persons in indulging in any mischief. At every stage, officials of respondents-authorities would come into picture to verify the exact commodity etc. which is sought to be exported in respect whereof rebate is being claimed. This is to verify that the goods actually exported are same of description, value etc., as claimed - The notification dated 06.09.2004 very clearly has said that rebate can be claimed in the manner the procedure has been laid down therein. It is difficult to hold that detail procedure regarding filing of ARE-I, which is the foundation in respect of verification of commodity sought to be exported and its exportability etc. is not mandatory but directory or condonable. I find no hesitation in confirming the view taken by respondent no. 1 that the procedure laid down in notification dated 06.09.2004 with respect to filing of ARE-I is mandatory.
Explanation offered by petitioner that due to ignorance of law he could not follow the procedure of filing ARE-I, also does not appear to be genuine and creditworthy. It is not the case of the petitioner that the export in question is his first transaction of export. He himself claimed to be a "Merchant Exporter" and dealing in export transactions. Such a person, if claim that he was not aware of the procedure, is very dubious statement and it is difficult to belief it - procedure with respect filing of ARE-I, looking from the view of straight and simple principle of interpretation, as also looking from the angle of its objective, purpose etc., in my view, is obligatory, the order impugned in the writ petition, cannot held faulty in any manner - Decided against assessee.
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2014 (1) TMI 1339
Condonation of storage loss and remission of excise duty leviable on 895 quintals of sugar - Remission of duty amount - Demand the duty of 895 quintals of sugar, which was found as storage lost - Held that:- Present case is one where storage loss was detected. The respondent never informed about storage loss. It has been noted in the order that on sufficient reasons storage loss upto 0.5% is condonable. It has been further noted by the Commissioner that the storage loss of 598 quintals, which is to the extent of 17% beyond the permissible limit of 0.5 is not condonable - remission of Central Excise duty could not have been allowed in view of non-disputed fact that storage loss was of 895 quintals - Decided in favour of Revenue.
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2014 (1) TMI 1338
Penalty u/s 11AC - Interest u/s 11AB - Suppression of facts - Contravention of provision of Central Excise Act and Rules - Intention to evade payment of duty - Payment made issuance of SCN - Whether or not the CESTAT was in error in holding that the penalty imposed under Section 11AC and the interest charged under Section 11AB of the Central Excise Act, 1944, are not sustainable if the duty is paid before issuance of show cause notice irrespective of the fact that evasion of duty was detected by the department and the demand was made under the proviso to Section 11A(1) on reason of suppression of facts or wilful misstatement of contravention of the provisions of Central Excise Act and Rules made there under with intent to evade payment of duty - Held that:- payment made whether before or after show cause notice, does not alter liability for penalty and the finding of the Tribunal holding that no penalty under Section 11AC of the Act could be imposed, if assessee had deposited short paid amount of excise duty before issuance of show cause notice was held to be a misconceived interpretation by the Tribunal, whereby the Tribunal overlooked the two explanations which qualified the main provision of Section 11A(2-B) and accordingly, set aside the order passed by the Tribunal.
In the show cause notice dated 10.10.2001, except for stating that the respondent/assessee has contravened the provisions of the Rules, there is no specific allegation so as to hold the respondent/assessee guilty of having committed fraud, collusion or suppression of facts or made any willful misstatement with an intent to evade payment of duty. In terms of the provision of section 11AC of the Act, the authority is bound to record a prima facie finding that there was an intent to evade payment of duty by suppressing the materials facts or by making willful mis-statement or by committing fraud or collusion. Thus, in the absence of any such specific allegation in the show cause notice, the authorities cannot mechanically impose penalty under Section 11AC of the Act. After the assessee submitted their explanation, the Adjudicating Authority while passing the order dated 24.09.2002, only observed that there is possible manipulation of scrap accounts to show higher production than what would have been normally produced and there is no finding that the first respondent/assessee was guilty of willful mis-statement or suppression of facts or act of fraud with an intention to evade payment of duty - in the absence of any specific findings having been recorded by the authorities, so as to make provisions of Section 11AC of the Act applicable to the case of the assessee, we have no hesitation to hold that the imposition of penalty was totally unjustified and the order of the Tribunal setting aside the penalty, is to be confirmed for reasons other than mentioned by the Tribunal.
Tribunal set aside the interest solely on the ground that the duty was paid prior to the show cause notice. The settled legal principle is that interest leviable under Section 11B of the Act is for the money withheld and the levy of interest is automatic and that is why it is termed to be compensatory. However, penalty is for default and therefore punitive and unless reasonable cause is shown, penalty is not imposable. This distinction was not taken into consideration by the Tribunal when admittedly, the Tribunal confirmed the demand of duty, which was paid belatedly by the respondent/assessee. Thus, the duty having been paid belatedly, the interest on such duty is automatic and the assessee is liable to pay the interest - Decided partly in favour of Revenue.
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2014 (1) TMI 1337
Waiver of pre deposit - Tribunal dismissed appeal for failure to make pre deposit - Held that:- dismissal of an appeal for failure to deposit the amount of pre-deposit determined, in essence, deprives a party its right of filing an appeal but as facts of the present case prima-facie disclose an unmitigated fraud perpetuated by the appellant while availing cenvat credit on raw material allegedly procured by them from various sources, are not inclined to grant any relief to the appellant - The appellant is a manufacturer in non-alloy steel ingots and availed benefit of cenvat credit on raw material procured by them from various sources. A search of the appellant's premises revealed that inputs were not received by the appellant and the transactions which formed basis for availing cenvat credit, were mere a paper transactions. The appellant's supervisor and melter made statements which clearly prove that the material received could not be used for melting. A finding of fact was also recorded that out of 203 invoices, corresponding goods received are not available with regard to 142 invoices. Out of ten transporters, seven were found to be nonexistent and three have denied having transported material to the appellant. The registration numbers of four trucks were found to be fake - no reason to hold that the CESTAT committed any error in directing the appellant to deposit ₹ 60 lacs of duty determined by the respondents. The second appeal was rightly dismissed for failure to abide by the order of pre-deposit - Decided against assessee.
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2014 (1) TMI 1336
Dismissal of stay application - Non apperance of counsel - whether the CESTAT was justified in dismissing the application for stay for nonappearance of the appellant or his counsel - Held that:- mere absence of an appellant or his counsel on one date, “may” not be sufficient to dismiss an application/appeal for default. Courts/Tribunals are constituted to decide disputes on merits and, therefore, dismissing an application/appeal on the first occasion of non-representation, in our considered opinion, may not be the right course to adopt. A perusal of the facts reveals that counsel for the appellant addressed a letter, Annexure A-7, to the CESTAT, praying for an adjournment as he had been advised rest on account of severe cervical pain. It appears that the letter was not placed before the CESTAT, for otherwise we are sure that the CESTAT would have adjourned hearing of the application - matter restored to CESTAT - Pre deposit demanded - Decided partly in favour of assessee.
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2014 (1) TMI 1335
Demand of duty - Manufacturing activity stopped due to hardship - Inability to pay excise duty - Invocation of Section 11A - Imposition of Compounded levy of tax - Held that:- On a perusal of Rule 96ZP of the Rules, it is evidently clear that it is a procedure of self-assessment where the manufacturers of hot re-rolled products falling under the different sub-headings in the Central Excise Tariff Act, are bound to debit the amount calculated at the rate of ₹ 400/- per metric tonne at the time of clearance from the factory in the account-current maintained under Rule 173G(1) of the Central Excise Rules, 1944, and the duty liability is to be complied as detailed in Clauses I and II under Rule 96ZP of the Rules. In terms of sub-rule (1A) of Rule 96ZP, if a manufacturer removes any of the said products without complying with the requirements of that sub-rule, such goods are liable to confiscation and the manufacturer shall be liable to a penalty not exceeding three times the value of goods or ₹ 5,000/-, whichever is greater. Sub-rule 3 of Rule 96ZP starts with a non-obstante clause and in fact, it is a facility given to the manufacturer, by which, the manufacturer, may, in the beginning of each month from 1st day of September, 1997 to 31st day of March, 1998 or any other financial year, pay a sum equivalent at the rate of ₹ 300/- multiplied by the annual capacity in metric tonnes. We term this as a facility in the light of Clause I(a) to Rule 96ZP, which mandates the amount to be paid at the rate of ₹ 400/- per metric tonne by 31st day of March, 1998.
Imparting the elements of the scheme of tax administration/recovery under Section 11A to a specially compounded levy scheme as provided under Rule 96ZP, would be wholly arbitrary and it would disturb the very functioning of the special scheme and the time limit prescribed under the special scheme, cannot be done away with by the time limit specified under the normal procedure under Section 11A - assessee had come under the compounded levy scheme with effect from 1997 and when they switched over to this, the credit lying unutilised, be in the inputs or in the final products, lapsed in terms of sub-rule (17) of Rule 57F - assessee has availed the benefit of a specially compounded levy scheme - therefore question of adjustment of the modvat credit as against the liability under Rule 96ZP, does not arise. However, it is open to the assessee to seek for reversal of credit, if any, lying to their credit, if so permitted under law - Following decision of COMMISSIONER OF CENTRAL EXCISE, PONDICHERRY V. SHARADHA CASTINGS (P) LTD. [2009 (4) TMI 525 - MADRAS HIGH COURT] - Decided partly in favour of assessee.
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2014 (1) TMI 1334
Waiver of pre deposit - Both the units were running as one single unit and had claimed exemption of small units operating separately - Held that:- goods worth Rs.80,13,000/-, which was seized, were directed to be released on payment of redemption fine of Rs.8,50,000/- in one case and Rs.1 lac in another case for redeeming the goods. The appellants could have redeemed the goods on payment of Rs.9,50,000/- and used the sale proceeds for payment of Rs.50 lacs - The balance sheets as the income tax returns filed today support that the firms and their partners do not have sufficient means, but that considering that proprietor of one of the firm was partner in another firm, which was running the business claiming exemption as separate units, the order passed by the Tribunal for a deposit of Rs.50 lacs only by consolidated order in both the cases, has taken into consideration the submission both with regard to prima facie case and the undue hardships, which may be caused to the appellants - No substantial question of law arises - However time limit for deposit extended - Decided partly in favour of assessee.
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2014 (1) TMI 1333
Restoration of appeal - tribunal dismissed the appeal for non compliance of stay order - Held that:- The appellant is unable to point out any fact or press into service any legal provision that would raise an inference that permission, beyond the permissible limit, was granted. The appellant's plea that it applied for further permission on 09.03.2008, is irrelevant, as the appellant is unable to refer to any order accepting this application. As regards the appeal, the Tribunal rightly dismissed the appeal for want of compliance - appellant's plea that as the unit has since closed down, the appellant has no funds, could have been relevant if the appellant had agreed to deposit some part of the duty claimed. In the absence of any such offer, the financial distress of the appellant cannot be considered - Decided against assessee.
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2014 (1) TMI 1332
Waiver of pre deposit - Duty demand - Imposition of equivalent penalty and interest - Whether in the facts and circumstances of the case, the Appellate Tribunal was justified in directing the Appellant to pre-deposit ₹ 1,00,00,000/- under section 35F of the Act - Held that:- during the hearing before the Tribunal, the appellant have stated that 90% of its turnover is in respect of traded goods whereas 10% of its total turnover is in respect of manufactured goods. Keeping that in view, the pre-deposit of the confirmed demand of ₹ 1.27 Crores was reduced to ₹ 1 Crore. Thus, for all the above reasons, we find no reason to interfere with the order of the Tribunal in the facts of the present case at this stage. The submissions made on behalf of the appellant would require consideration in depth and the same could appropriately only be done at the time of final hearing of its appeal before the Tribunal - However, the time to make the pre-deposit stands extended from 30 November 2013 to 31 January 2014 and on producing evidence of the same before the Tribunal - Following decision of Furniture Products Ltd. v. CCE [2009 (12) TMI 606 - CESTAT, CHENNAI] - Decided partly in favour of assessee.
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2014 (1) TMI 1216
Rejection of the rebate claim - Export of quilt cover - Revenue rejected rebate claim holding that list of the products appended to notification issued under Rule 191A, the entry at serial No.17 was only “Cotton Quilts” and there was no entry of “Quilt Cover” - Held that:- what has been exported is scourd quilt cover as described in Form AR5s on which refund has been claimed. The shipping Bills relevant to the rebate claims in question described the goods as 100% cotton Fabrics Millmade scoured feather proof quilt covers double stitched. In the relevant contract copy produced by the assessee, the description of the goods exported reads as 100% Cotton Made in India Scoured Feather Proof Silicon Finish Piped Seam Quilt Shells”.
At the time of personal hearing I have been shown a sample of Quilt Shell which had a small opening at one side through which the feathers or cotton can be pumped in the said shell. There was no stuffing in the said Quilt Shell/Cover. Thus it is abundantly clear that what has been exported is not the Quilt (Rajais) as it is known in the trade but Quilt Cover/Shell without any stuffing therein. The party themselves have admitted that there is no stuffing inside the said so called shell/cover. The Quilt/Rajais in India or abroad is known as such only with stuffings of feather/cotton/polyester inside two layers of fabrics stitched together from all sides. Quilt shell/cover cannot be called as quilt until it is stuffed with the stuffing materials which can be feather/cotton/polyester fibre. Description Quilt (Rajais) therefore does not cover Quilt Shell/Cover which is a component of Quilt. Since the rebate is allowed only in respect of Quilt (Rajais) only, and not on Quilt Shell/Cover, party is not entitled to rebate in terms of Rule 191A read with Notification/Declaration issued by Central Board of Excise and Customs in this regard. There is no other Notification/Declaration of C.B.E.C. under which the rebate claim under Rule 191A could be allowed to Quilt Shell/Cover - Decided against assessee.
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2014 (1) TMI 1215
Rectification of mistake - Bar of limitation - Service of order on an unauthorised representative - Held that:- it is evident that Vijay Kumar Agarwal was infact an authorised signatory of the appellant-assessee. The submission that it is only a legal practitioner who can be an authorised representative is misconceived. Section 35-Q (1) provides that any person who is entitled or required to appear before a Central Excise Officer or an Appellate Tribunal in connection with any proceedings under the Act, otherwise than when required to appear personally for examination on oath or affirmation, may appear through an authorised representative. Sub-section (2) defines the expression 'authorised representative' for the purpose of sub-section (1) as inter alia being a regular employee. Section 35-Q, which has been relied upon by the appellant would, therefore, not carry its case any further. In the present case, service was effected on an authorised representative and the order of the Tribunal does not suffer from any error - The Commissioner (Appeals) was correct in holding that he could not have condoned a delay beyond the period of thirty days under the proviso to Section 35(1) - Following decision of M/s. Singh Enterprises Vs. Commissioner of Central Excise, Jamshedpur & Ors. [2007 (12) TMI 11 - SUPREME COURT OF INDIA] - Decided against assessee.
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2014 (1) TMI 1214
Rectification of mistake - Held that:- An authorised signatory who has received an adjudication order on behalf of the Company, which is an assessee, may not necessarily be an authorised signatory to receive a copy of the order on behalf of the Director. Since this aspect has not been considered in the order of the Tribunal, we are of the view that the appropriate course of action would be to set aside the impugned order of the Tribunal only in so far as it relates to the appellant. We clarify, by way of abundant caution, that the present order will not affect the order of the Tribunal on the rectification application in relation to the assessee Company against which an appeal has been dismissed by an order passed separately - Application restored.
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2014 (1) TMI 1213
Confiscation and penalty under Rule 173Q - Mens Rea - Clandestine removal of goods - Whether the provisions of Rule 173Q of the Central Excise Rules, 1944 is attracted in the absence of any intention to waive the payment of central excise duty and/or in absence of removal of any excisable goods or any entry of any excisable goods in RG-1 Register - Held that:- show cause notice was issued to the appellant not only for holding of excess stock with the intention to clear the goods clandestinely and evade payment of central excise duty but also for deliberately mis-stating the production figures in RG-1 Register and filing of returns giving false production figures. It cannot, therefore, be contended that the show cause notice was issued only for violation of Rules 53 and 54 - Rule 173Q deals with confiscation and penalty and Rule 209 deals with penalty provision. Rule 173Q – confiscation and penalty – arise under breach of duty provided in the Central Excise Act and Central Excise Rules, which creates strict liability without proof of mens rea. As per Rule 173G(4)(a), every assessee to maintain such accounts, as the Commissioner may from time to time require of the production. Rule 53 deals with daily stock account and Rule 54 deals with monthly returns. Non-maintaining of accounts and non-accounting of the manufactured goods in the statutory records attracts the provision of Rule 173Q.
Unless there is something in the language of the statute indicating the need to establish the element of mens rea, it is generally sufficient to show that a default to comply with the Rules has occurred attracting confiscation and penal provisions. There is nothing in Rule 173Q or Rule 209, which required that mens rea/intention need to be established - The Legislature used the conjunction “or” in Rule 173Q for Rule 173Q(1)(a) and Rule 173Q(1)(d), the Court cannot read into Rule 173Q(1)(b) that there should be the intention to evade payment of excise duty - mens rea of the appellant to remove the manufactured goods with intention to evade payment is not essential - appellant had not accounted for the manufactured goods and had not made entries in RG-1 Register. Non-accounting of manufactured goods in the statutory records falls within the ambit of Rules 173Q(1)(b) attracting provision of confiscation and penalty - Tribunal had taken a lenient view reducing the redemption fine to ₹ 3 lakhs and also penalty to ₹ 3 lakhs - Decided against assessee.
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2014 (1) TMI 1212
Penalty u/s 11AC - Mandatory or directory - Held that:- penalty provision under section 11AC and also Rule 96-ZQ and 96ZO of Central Excise Rules,1944 as to whether the penalty provision is mandatory or discretionary, rejecting the plea that Rules 96ZQ and 96ZO have a concept of discretion inbuilt - reference was made for determination as to whether Section 11AC of the Central Excise Act, 1944 inserted by the Finance Act, 1996 with the intention of imposing mandatory penalty on persons who evaded payment of tax should be read to contain mens rea as an essential ingredient and whether there is scope of levying penalty below the prescribed minimum - Observing that the levy of penalty is a mandatory penalty and there is no scope for any discretion and rejecting the plea that Rules 96ZQ and 96ZO have a concept of discretion in-built - The matter is remitted to CEGAT for reconsidering the matter afresh in the light of the law laid down by the Hon’ble Supreme Court in the case of Dharamendra Textile Processors & Ors. reported in (2007 (7) TMI 307 - SUPREME COURT OF INDIA) and further clarified in the case of Union of India Vs. Rajasthan Spinning & Weaving Mills reported in (2009 (5) TMI 15 - SUPREME COURT OF INDIA) - Decided in favour of Revenue.
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2014 (1) TMI 1211
Period of limitation for filing export proof under Rule 19 - Applicant had cleared the goods for export viz. Chlorinated Paraffin wax vide ARE-1 under letter of undertaking (LUT) under Rule 19 of Central Excise Rules, 2002 – Held that:- There is no time limit provided either in Rule 19 of the Central Excise Rules, 2002 or in the Notification dated 26-6-2001 referred to by the revisional authority in the impugned order. Such Notification, which is issued in exercise of powers under Rule 19 of the Central Excise Rules, 2002 lays down the procedure and condition on which the goods can be so removed. Condition No. (ii) in para-1 of the Notification requires the manufacturer to export such goods within six months from the date of which they were cleared for export from the factory of the production or the warehouse, etc. This condition does not provide for filing of original documents within any time limit. This is not to mean that no time limit is fixed would permit a party to produce such documents at any time howsoever late.
In the present case, such documents were seized by the Customs Authority. Therefore, the petitioners could not produce the same before the adjudicating authority and the higher authority, till the documents were released in June-2012 as noted above. Therefore, no fault can be attached on the petitioners. Before the Appellate as well as Revisional Authorities also the petitioners had taken a stand that such documents are in the custody of the Customs Officer and therefore, could be produced - The proceedings are placed back before the adjudicating authority - Decided in favour of assessee.
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2014 (1) TMI 1210
Denial of refund claim - Invocation of extended period of limitation - Whether the extended period of time can be invoked – Held that:- Since the finding of CESTAT that the respondent was adding DEP in duty paid procured ENA which was within the knowledge of the Excise is a finding of fact, leave was sought by the appellant to amend the said Excise appeals. Despite several adjournments being given the said amendment could not be carried out since the relevant files could not be traced - Since the relevant material could not be produced on record, it is now not open for the appellant to challenge the finding of fact recorded by the CESTAT and as such, in our view, therefore, there is no substantial question of law involved in both the appeals - Decided against Revenue.
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2014 (1) TMI 1209
Availment of MODVAT Credit - Whether Rule 57G, sub-rule (5) of Central Excise Rules can be applied to deny the balance amount of Modvat credit when portion of the credit has already been availed by the appellant against the invoices - Held that:- The present case is not a case of taking credit beyond six months, but of taking balance credit amount, which the appellant wrongly availed only 50%. Since the input (furnace oil) was entered in Part I and since the appellant has already availed 50% of the Modvat credit, for availing of the balance 50% Modvat, six months time cannot be computed as contemplated by Rule 57G, sub-rule (5). The authorities did not keep in view that availing of balance 50% was only rectification of the earlier inadvertent mistake committed by the appellant and the order of the Tribunal cannot be sustained - Decided against assessee.
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2014 (1) TMI 1165
Waiver of Pre-deposit – Held that:- Assessee contended that the default was made good by making payment through PLA along with interest by 5th July 2011 – Relying upon Solar Chemferts Pvt. Ltd. vs. CCE, Thane-I [2011 (6) TMI 640 - CESTAT, MUMBAI] - in case the default in payment of duty is made good through PLA along with interest and during the period of default cleared the goods by utilising the credit is not contrary to the provisions of Rule 8 of the Central Excise Rules hence the demand is not sustainable – Prima facie the appellant is able to made out a case in their favour – Pre-deposits waived till the disposal – stay granted.
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