TMI Blog2014 (6) TMI 720X X X X Extracts X X X X X X X X Extracts X X X X ..... interest subsequent to removal of exempted final products, then the appellant cannot be said to have taken credit of inputs used in or in relation to the manufacture of exempted final products, and they need not pay an amount @ 8% or 10% of the sale price of exempted final products. - matter remanded back to adjudicating officer to verify the facts and reversal of credit - Decided in favor of assessee. Jurisdiction of Tribunal to entertain an appeal - one time opportunity vide sub-sections (2) and (3) of the said Sections 70 to 73 of the Finance Act 2010 - Held that:- Evidently, the applicant has not complied with the provisions sub-section (3) of Sections 70 to 73 of the Finance Act, 2010, as the differential amount of ₹ 60,32,345/- decided by the appropriate authority was not paid within ten days of receipt of the said Order dated 28.12.2010. In these circumstances, the Order No. Section 68 to 72/ F.A./ COMMISSIONER/ 03/ 2010 dated 28.12.2010, passed by the Commissioner of Central Excise Ahmedabad-II, does not exist after the time specified in the relevant sections of Finance Act, 2010. It was a one time scheme. It has to be either accepted or rejected by the concerned ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 00-01 to 2003-04 as per the provisions of Rule 57CC of the Central Excise Rules 1944, Rule 6 of the CENVAT Credit Rules 2001/2002. Another show cause notice dated 01.12.2005 on the same grounds for the period from November, 2000 to March, 2005 for recovery of amount of Rs. 87,96,155/- was issued by the Commissioner, Central Excise, Ahmedabad-II. Both the show cause notices, invoking extended period of limitation, were adjudicated by the Commissioner, Central Excise, Ahmedabad-II vide the impugned Order-in-Original confirming demand of Rs. 88,41,543/-, along with interest, and imposing penalty of equivalent amount. Aggrieved with the impugned Order-in-Appeal, the appellant filed Appeal No. E/260/2007 with the CESTAT. 3.2 Meanwhile, vide Sections 70 to 73 of the Finance Act 2010, provisions of Rule 57AD of Central Excise Rules 1944, Rule 6 of CENVAT Credit Rules 2001/2002/2004 were amended retrospectively to enable manufacturers to pay an amount equivalent to CENVAT Credit attributable to the inputs used in, or in relation to the manufacture of exempted goods before or after the clearance of such goods, where a dispute relating to adjustment of credit of inputs used in or in relat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ; (e) Metal Extruders India Pvt. Ltd. Vs. Union of India - [1994 (69) ELT 477 (Bom.)]; (f) Commissioner of C. Ex., Indore Vs. Sidharth Tubes Ltd. - [2004 (170) ELT 331 (Tri. Del.)]; and (g) Shreeji Colourchem Industries Vs. Commissioner of Central Excise, Vadodara - 2013 (294) ELT 615 (Tri. Ahmd.)]. (ii) That the appellant has already reversed input credit of Rs. 7,85,573/- attributable to inputs used in the manufacture of exempted finished goods during the material period. He submitted that this issue is also the subject matter of Appeal No. E/ 444/ 2011 filed by the Revenue and Appeal No. E/ 449/ 2011 filed by the appellant. (iii) That the appellant has already deposited Rs. 23,19,954/- against their liability to reverse the credit of Rs. 7,85,573/- attributable to inputs used in the manufacture of exempted goods. He argued that subsequent reversal of credit with interest is sufficient to discharge the demand as held in the following case laws: (a) Shree Rama Multi Tech Ltd. Vs. Union of India - [2011 (267) ELT 153 (Guj.)]; (b) Commissioner of Central Excise, Salem-I Vs. Burn Standard Co. Ltd. - [2013 (294) ELT 389 (Mad.)]; (c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e but not adjudicated. (ii) Whether subsequent reversal of credit attributable to inputs used in the manufacture of exempted final products with interest is sufficient to discharge the demand of amount @ 8% or 10% of the sale price of exempted goods if the assessee fails to maintain separate inventory of inputs for manufacture of dutiable and exempted goods. (iii) Whether the Appeal No. E/ 444/ 2011, filed by the Revenue, and Appeal No. E/ 449/ 2011, filed by the assessee, against Order No. Section 68 to 72/ F.A./ COMMISSIONER/ 03/ 2010 dated 28.12.2010, passed by the Commissioner of Central Excise Ahmedabad-II, are maintainable when the appellant had not complied with the same. 7.1. On the issue of invocation of extended period in raising demands, we note that in the case of Nizam Sugar Factory vs. Collector of Central Excise (supra), the Hon ble Supreme Court has held as under: 8. Without going into the question regarding Classification and marketability and leaving the same open, we intend to dispose of the appeals on the point of limitation only. This Court in the case of P B Pharmaceuticals (P) Ltd. v. Collector of Central Excise reported in (2003) 3 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... SCALE 390], the question was whether the extended period of limitation could be invoked where the Department has earlier issued show cause notices in respect of the same subject-matter. It has been held that in such circumstances, it could not be said that there was any wilful suppression or mis-statement and that therefore, the extended period under Section 11A could not be invoked. Similarly, this judgment was again followed in the case of Hyderabad Polymers (P) Ltd. v. Commissioner of Central Excise, Hyderabad reported in 2004 (166) E.L.T. 151 (S.C.). It was observed in para 6 : .......... On the ratio laid down in this judgment it must be held that once the earlier Show Cause Notice, on similar issue has been dropped, it can no longer be said that there is any suppression. The extended period of limitation would thus not be available. We are unable to accept the submission that earlier Show Cause Notice was for a subsequent period and/or it cannot be taken into consideration as it is not known when that Show Cause Notice was dropped. If the Department wanted to take up such contentions it is for them to show that that Show Cause Notice was not relevant and was not applica ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n which reliance was placed has come to the conclusion that the assessee would not be covered by Rule 57AD of the Rules read with sub-rule (3) of Rule 6 of the CENVAT Credit Rules. There is no liability for payment of 8% of the price of the exempted final products as CENVAT credit availed has been reversed and they did not have the benefit of the said credit. 7. Therefore we do not see any infirmity in the order which is passed by the Tribunal which calls for interference. Accordingly we do not see any merit. The substantial questions of law are answered in favour of the assessee and against the revenue. Accordingly the appeal is dismissed. Similarly, in the case of Commissioner of Central Excise, Ahmedabad vs. Maize Products the Hon ble High Court of Gujarat has held as under: 4. After hearing the parties, the Tribunal has issued the following directions. (6) We have carefully considered the submissions. We are convinced that the demand is highly disproportionate to the credit availed on the common inputs which could be attributed to goods which have been cleared without payment of duty. We are not going to the merits of the decision of the Commissio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... show that the direction was to re-determine the credit taken on common inputs and accept the offer to reverse such entire credit on common inputs insofar as they relate to demand proposed in the nine show cause notices. The Tribunal has also recorded the undertaking given by the respondent-assessee that if any further credit is to be reversed, the same shall be reversed within four weeks from the date of receipt of the communication from the Department. Hence, in the facts and circumstances of the case, it is apparent that the entire controversy has been decided by the Tribunal by merely remitting the matter back to the Adjudicating Authority to re-determine the credit in accordance with law. If any reversal has been made by the respondent-assessee, the same is subject to verification and adjustment if ultimately any further amount is found reversible. 7.3 We find that the ratio of the above case laws is squarely applicable to the appellants case. We, therefore, hold that if CENVAT Credit attributable to inputs used in the manufacture of exempted final products is reversed along with interest subsequent to removal of exempted final products, then the appellant cannot be said t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4.2000 to 31.03.2008 was pending on 08.05.2010. For this one time opportunity, the following procedure was prescribed under sub-sections (2) and (3) of the said Sections 70 to 73 of the Finance Act 2010: (2) Where a person opts to pay the amount in accordance with the provisions as amended by sub-section (1), he shall pay the amount along with interest specified thereunder and make an application to the Commissioner of Central Excise along with documentary evidence and a certificate from a Chartered Accountant or a Cost Accountant certifying the amount of input credit attributable to the inputs used in or in relation to the manufacture of the final products, which are exempted from the whole of the duty of excise leviable thereon or chargeable to nil rate of duty, within a period of six months from the date on which the Finance Bill, 2010 receives the assent of the President. (3) The Commissioner of Central Excise shall, on receipt of an application under sub-section (2), verify the correctness of the amount paid within a period of two months from the date of receipt of the application and in case the amount so paid is found to be less than the amount payab ..... X X X X Extracts X X X X X X X X Extracts X X X X
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