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Central Excise - Case Laws
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2015 (10) TMI 2842
Calculation of CENVAT credit to be availed by a DTA unit in respect of inputs procured from 100% EOU - value of Basic Customs Duty (BCD) as leviable or what has exactly been paid by 100% EOU will be leviable.
Revenue's objection is that the formula, as prescribed under the said Rule denotes the BCD actually paid by the 100% EOU and not the BCD leviable on like goods if imported into India.
HELD THAT:- The said issue stands decided by the Tribunal in the appellant's own case M/S. MICRO LABS LTD VERSUS COMMISSIONER OF CENTRAL EXCISE [2015 (10) TMI 1788 - CESTAT BANGALORE] wherein by taking note of a precedent decision in the case of SV. SALES CORPORATION VERSUS COMMISSIONER OF CENTRAL EXCISE, SURAT [2013 (9) TMI 209 - CESTAT, AHMEDABAD] it stands held that the BCD, mentioned in the said formula, refers to the BCD leviable on the like goods if imported into India.
The impugned order set aside - appeal allowed.
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2015 (10) TMI 2836
CENVAT Credit - supplier not paying duty on inputs - Revenue is of the view that as the supplier of these inputs namely SE copper wire is not liable to pay duty as SE Copper wire is not dutiable, therefore, the respondent is not entitled to take Cenvat credit - HELD THAT:- The facts of the case are not in dispute. As the respondent has paid the duty on SE Copper wire purchased from the supplier and taken the Cenvat credit. Although SE Copper wire is not dutiable but the respondent has paid the duty, they have taken Cenvat credit correctly as per Rule 3 of the Cenvat Credit Rules, 2004.
There are no merit in the Revenue’s appeal - appeal of Revenue dismissed.
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2015 (10) TMI 2825
Jurisdiction - power of Commissioner (Appeals) to remand the matter - HELD THAT:- The issue is no more res integra, in view of the decision of the Hon’ble Delhi High Court in the case of Commissioner of Service Tax, Delhi Vs. World Vision [2010 (10) TMI 894 - DELHI HIGH COURT]. The Hon’ble Gujarat High Court in the case of Commissioner of Service Tax Vs. Associated Hotels Ltd. [2014 (4) TMI 406 - GUJARAT HIGH COURT] held that the Commissioner (Appeals) have power to remand the matter.
All the appeals filed by the Revenue are dismissed. Early Hearing application is rejected as infructuous.
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2015 (10) TMI 2802
Valuation of goods - Section 4 - deduction towards Sales Tax, Cash Discount and Volume Discount on excise duty payable - HELD THAT:- The issue decided in the case of M/S. PUROLATOR INDIA LTD. VERSUS COMMISSIONER OF CENTRAL EXCISE, DELHI – III [2015 (8) TMI 1014 - SUPREME COURT] where it was held that It is clear that “cash discount” has therefore to be taken into account in arriving at “price” even under Section 4 as amended in 2000.
Appeal dismissed.
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2015 (10) TMI 2801
Maintainability of appeal - monetary amount involved in the appeal - HELD THAT:- Since the tax effect involved in the instant appeal is negligible, the appeal is dismissed on this ground alone.
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2015 (10) TMI 2776
Constitutional validity of Rule 8(3A) of the Central Excise Rules, 2002 - Violation of Article 14 - HELD THAT:- Issue notice.
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2015 (10) TMI 2754
Demand of duty - distribution of cenvat credit by the ISD - the appellant's submission is that the demand notice has been issued to Roha factory and is without jurisdiction. According to the learned counsel, the show cause notice should have been issued to ISD located at Thane and not to them - HELD THAT:- Credit is finally availed and utilised by the manufacturing unit. What learned counsel is trying to say is that show cause notice should be issued to head as hand has acted as per the direction of head. In our view, as rightly pointed out by learned AR, cause of action stands with availment and utilization of credit at the manufacturing unit. Of course, ISD and manufacturing unit are integrally connected, and both of them unitedly has to resolve the issue with the department. We, therefore, reject the plea regarding jurisdiction.
CENVAT Credit - input service distribution - common input services used in trading as well as manufacturing activity - assessment of distribution of credit made at the ISD - HELD THAT:- It would be seen from the definition that input service distributor is neither a service provider nor a manufacturer, but it is only an office of service provider or manufacturer. Since input service distributor neither manufactures the goods nor provides the service, there is no question of input service distributor liable to pay any excise duty or service tax. (The company will, of course, either be manufacturing the goods or providing the service from either the same location or some other location). There is therefore no question of assessment or self assessment by ISD.
Rule 7 of the Cenvat Credit Rules states that input service distributor is expected to distribute the credit and ensure that the credit distributed does not exceed the amount of service tax paid as per the documents. The other condition is that the credit of service tax attributable to service used in a unit exclusively engaged in the manufacture of exempted goods or providing exempted service shall not be distributed. It will be seen from the above Rule that these are only two guidance for the ISD for distribution of the credit. There is no rule in Service Tax Law which provides assessment or self-assessment by ISD.
Next submission of the learned counsel is that credit cannot be denied unless the assessment of distribution of credit made at ISD is set aside - HELD THAT:- All that input service distributor is to certify in clause (b) that they have distributed cenvat credit correctly. Based upon the heading given in the return which is a common heading for service provider as well as input service distributor, it cannot be claimed that input service distributor is making self-assessment and that self-assessment is required to be challenged. No rule provides for assessment/self-assessment by ISD.
Time Limitation - HELD THAT:- It is an admitted position that the appellant was registered as input service distributor and the fact that the appellant was also undertaking trading activity was suppressed from department and this has been admitted by the Director of the company. Thus, there is a suppression of fact and in our view the extended period of limitation is correctly invoked.
Appeal dismissed - decided against appellant.
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2015 (10) TMI 2724
Maintainability of appeal - parallel remedy sought against same cause of action - Appellant explains that against the appellate order appellant is also before Hon'ble High Court of Madras in CMA - Held that:- Law being well settled that parallel remedy cannot be sought against same cause of action, both the appeals are dismissed.
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2015 (10) TMI 2713
Valuation - annual capacity based production - pinion stand found was 195 mm. and not 157 mm. as declared earlier by the appellant - demand of differential duty - Held that: - It is a fact that the change of parameter was noticed only on surprise check by the officers - It is also a fact that the appellants had declared gearbox of 195 mm. in their earlier declaration on 26.08.97. When the Annual Capacity was fixed by the Commissioner based on the declarations made by the appellant, it is not open to the appellant to change some of the parameters without intimation and later on to claim that it is only a temporary change.
Since there is no evidence of the exact date of the change in the parameter submitted by appellant, we are in agreement that the capacity of production as fixed by the Commissioner based on 195mm. is sustainable.
Appeal dismissed - decided against appellant.
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2015 (10) TMI 2704
Manufactured goods - Marketability - Aluminium Dross and Skimmings or similar Non-ferrous Metal Dross and Skimmings - the decision in the case of Hindalco Industries Limited Versus The Union of India, Customs, Excise And Service Tax Appellate Tribunal, The Commissioner of Central Excise [2014 (12) TMI 657 - BOMBAY HIGH COURT], where it was held that Merely because the goods satisfying the test of being marketed and saleable, it does not mean that the test of being manufactured in India has been satisfied - Held that: - delay condoned - notice issued.
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2015 (10) TMI 2691
Reward Scheme - evasion and theft of taxes by M/s Cairn Energy Private Limited - the decision in the case of Kishor Gordhnsing Raghuwanshi Versus Secy., Ministry of Peteoleum & Natural Gas [2014 (4) TMI 1196 - BOMBAY HIGH COURT] contested, where it was held that the claim of petitioner for reward being highly disputed, it cannot be allowed - Held that: - the decision in the above case upheld - SLP dismissed.
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2015 (10) TMI 2686
Rectification of Mistake - Held that: - It is pertinent to state that Tribunal can rectify any mistake apparent on record in the said order. Appellant claiming to reconsider the citations and also to draw findings on their contention amounts to seeking revisit the facts and findings of the Tribunal’s order dated 20-11-2014 which amounts to review of the order and there is no power vested with Tribunal to review its order.
Hon’ble Supreme Court in the case of CCE v. RDC Concrete (India) Pvt. Ltd. [2011 (8) TMI 25 - SUPREME COURT OF INDIA] clearly held that re-appreciation of evidence done by CESTAT cannot be considered as rectification of mistake and held that the ROM order is bad in law and quashed the order.
The Hon’ble Supreme Court decision in the case of CCE, Calcutta v. A.S.C.U. Ltd. [2002 (12) TMI 87 - SUPREME COURT OF INDIA], wherein the Apex Court held that any decision on debatable point of law cannot be treated as ‘mistake apparent from record’.
There are no apparent and manifest mistake in the Tribunal’s final order so as to exercise the powers to recall or modify the Final Order No. 40828/2014, dated 20-11-2014.
ROM application rejected.
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2015 (10) TMI 2673
CENVAT credit - outdoor catering service - denial on account of nexus - Held that: - reliance placed in the case of CCE Nagpur vs Ultratech Cements Ltd. [2010 (10) TMI 13 - BOMBAY HIGH COURT] wherein it has been held that service tax paid by the employer on the outdoor catering service shall be eligible for cenvat credit - appeal dismissed - decided against Revenue.
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2015 (10) TMI 2671
Delegation of powers - powers delegated to the Collector of Central Excise - offences punishable under Section 9 of the Central Excise Salt Act 1944 - omission of Rule 56A - the allegations against the accused were that in pursuance to the permission granted on 07/07/1983, the credit of ₹ 1,17,35,014/- was permissible, but instead, by making a dishonest and deliberate double entries of credit of the said amount, impermissible credit in the sum of ₹ 1,17,35,014/- was taken and thus an offence under the aforestated provisions were committed - effect of omission of Rule 56A on pending a complaint before the trial Court.
Whether the prosecution can subsist after omission of Rule 56A without a saving clause? - whether Sections and 3 and 38A of the Act or Section 6 of the General Clauses Act would be able to save the situation?
Held that: - While addressing the issue arising under Section 38A of the Act, it was observed that Section 38A operates in respect of amendment, repeal, supersession or rescinding of any rule, notification or order, but not in the eventuality of an omission. It was explained that omission and repeal are different things and omission does not amount to repeal. The Court also referred the dictionary meaning of 'rescind' and 'amend' and observed that the same are not synonymous with the word 'omit'. It was thus held that Section 38A of the Act would not save any obligation, liability etc. acquired, accrued or incurred under any rule, order or notification which has been omitted. Similar fact situation is prevalent in the present case and therefore on omission of the rule in absence of savings, the proceedings under Section 138A of the Act in question would not be saved.
Similar is the fact situation in the present case. As indicated earlier, the relevant notification in this case also does not make any provision akin to Section 6 of the General Clauses Act. It also does not make any provision continuing the liabilities incurred under Rule 56A.
Immediately on omission of Rule56A during the pendency of the complaint, it is deemed to have disappeared from the statute book and therefore it can no more be relied upon. Consequently, no prosecution initiated during the subsistence of Rule 56A can continue after its omission and therefore penal consequences flowing therefrom would cease. It therefore can be said that the act or omission on the part of the petitioner was not punishable on and after the date of ‘omission’ of Rule 56A and in view of above discussion, the introduction of Section 38A with specified savings would not come to the aid of the prosecution as the act which was not punishable on omission cannot be punishable by virtue of explanation to Section 38A.
The trial Court failed to address the legal proposition in its true perspective. It is settled legal position that though at the time of considering the application for discharge, the Court is not obliged to appreciate the evidence, but certainly it is required to see the evidence with an object to find out as to whether the material justifies framing the charge and whether the charge, if framed on the basis of existing material, would be groundless or not? The endavour of the Court would be to examine the material available and find out whether the material is good for trial. The charge would be certainly groundless if it is framed in ignorance of settled proposition of law on a given subject.
This Court has reason to interfere with the impugned order in exercise of powers conferred under Section 397 of the Cr.PC and thus the impugned order deserves to be quashed and set aside and the application for discharge deserves to be accepted - application allowed.
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2015 (10) TMI 2650
Utilisation of CENVAT credit - accumulated money credit by use of unconventional/minor oils - Held that: - the appellant is entitled to utilise the Cenvat credit lying in its balance as on 1/3/2003 and the said credit had not lapsed - reliance placed in the case of M/s Madhusudan Industries Ltd Vs. Union of India [2013 (1) TMI 525 - ALLAHABAD HIGH COURT], where it was held that money credit was a mandatory right earned by manufacturers on purchasing and use of unconventional/minor oils, for which the manufacturer may have changed manufacturing process and plant hoping of getting the money credit. Thus such vested right cannot be taken away due to the rescision of the notification - appeal allowed - decided in favor of appellant.
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2015 (10) TMI 2637
Exemption under Exemption N/N. 6/2002-CE dated 01.3.2002, read with list -6(5), or N/N. 6/2006-CE dated 01.3.2006 - the decision in the case of Commissioner of Central Excise & ST., Surat and others Versus M/s. Bhagyarekha Engineers Pvt. Limited and others [2014 (8) TMI 778 - CESTAT AHMEDABAD] contested - Held that: - we do not see any good ground to interfere with the judgment(s) and order(s) passed by the Customs, Excise and Service Tax Appellate Tribunal - appeal dismissed - decided against appellant.
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2015 (10) TMI 2636
Refund claim - whether the appellant is entitled to refund of the Education Cess and Higher Education Cess in terms of area based exemption N/N. 56/2002 or not? - Held that: - The issue has been examined by this Tribunal in the case of M/s. Jindal Drugs Ltd. [2009 (8) TMI 812 - CESTAT, NEW DELHI] wherein it has been held that Education Cess and Higher Education Cess is not exempted in terms of said notification - appellant is not entitled to claim refund of Education Cess and High Education Cess - appeal dismissed - decided against appellant.
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2015 (10) TMI 2627
Refund claim - claim on the ground that finished goods removed to its Madras Depot on payment of duty were found substandard, and as such, the same were returned to the factory and upon re-packing, the same were cleared on payment of Central Excise Duty - Held that: - no security to the satisfaction of this Tribunal has been furnished by the appellant, entitling it to get the refund from the Original Authority - for the purpose of meeting the ends of justice, the appellant should be given an opportunity to furnish the bond for the refund amount - appeal disposed off - decided partly in favor of appellant.
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2015 (10) TMI 2616
Manufacture - production of PVC insulated winding wires amounts to manufacture or not - Held that: - no manufacture is involved if the wire of higher cross-dimension is drawn into the wire of lesser cross-dimension - in the present case, the final product for which exemption is being claimed is PVC Insulated Winding Wire. The input and the finished products are clearly distinct products and are known in the market as such. It would not require much imagination to show that process of making of PVC Insulated Winding Wire from simple wire is a process resulting in a different product and thus amounting to manufacture.
Whether the PVC winding wire should be made from wire exceeding 6 mm cross-sectional diameter? - does it mean that the wire exceeding 6 mm cross-sectional diameter should be in the hands of the appellant themselves - Held that: - even if the wire of cross-dimensional section exceeding 6 mm was not in their hands, it does not mean that the same was not the source of the material out of which PVC wire were made - The exemption on manufacture of PVC Insulated Winding Wire was available only if the input was wire of maximum cross dimensional area exceeding 6 mm of copper. We do not find under the notification any reference to the fact that PVC Winding wire should be made from cross-dimensional area less than 6 mm. This would be a mere presumption and has not been explained by the learned Counsel. Once the conditions of the notification are laid down, we see no reason to deviate from the same.
Time bar - Held that: - it is impossible for the Central Excise authorities to know that the assessee was using such wire. It was only after audit was conducted that the true facts came to light. Therefore, there is clear suppression of facts in claiming the benefit of notification wrongly. The extended period in such case is invocable.
Whether the plea that the benefit of Modvat credit on the inputs should be given in case the benefit of exemption is denied, is justified? - Held that: - had they not availed the benefit of Nil rate of duty under the exemption, Modvat credit on the inputs would have been available - we allow the benefit of the Modvat credit on the inputs subject to verification by the jurisdictional Assistant Commissioner.
There was mis-statement of facts, the mandatory penalty under Section 11AC is imposable.
Appeal disposed off - decided partly in favor of appellant.
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2015 (10) TMI 2614
Misdeclaration of the export of goods - DEPB Scheme - procedural infirmity - applicability of rule 19 of CER, 2002 - applicant initially exported the goods under ARE-1 No. EX/109/2005-06, dated 31-10-2009 under DEPB scheme, duly sealed and signed by the Inspector of Central Excise. At the port of export, the Customs officials refused to sign the same on the ground that the ARE-1 was not signed by the Superintendent, Central Excise. That being advised by the Customs authorities the applicant prepared another ARE-1 with the same number and date and same details and the same was produced before the Customs authorities as self-sealing in order to export the goods expeditiously. That the Customs authorities after being satisfied allowed the export and signed the duplicate copy of the ARE-1.
Held that: - the applicant has contravened the provisions of Rule 19 of the Rules, ibid inasmuch as the applicant has prepared parallel set of statutory documents which cannot be created. ARE-1 is in the nature of an application made to the proper officer for removal of goods for export under Rule 18. If for any reason such an application is not found fit for use to remove the goods for export it should have been withdrawn or amended with the approval of the proper officer as laid down in Notification No. 43/2001, dated 26-6-2001. There is nothing on record to show that any such effort was made by the applicant. The applicant instead created a parallel set of statutory documents which is not laid down in Notification, therefore is not correct.
Imposition of penalty u/s 11AC - Held that: - the order passed by Commissioner (Appeals) is erroneous and not maintainable, the question of imposition of penalty does not arise.
Application rejected.
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