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2015 (6) TMI 403 - CESTAT AHMEDABAD

2015 (6) TMI 403 - CESTAT AHMEDABAD - 2016 (335) E.L.T. 697 (Tri. - Ahmd.) - Invocation of extended period of limitation - Revenue neutrality - whether the extended period of limitation under proviso to Section 11A of the Central Excise Act, 1944 is applicable and whether the demand within the period of limitation is demandable from the Appellant in view of the doctrine of revenue neutrality - Held that:- CENVAT Credit by the DTA unit is not required to be reversed/paid when the inputs are clear .....

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the extended period was invokable in these cases. It is further observed from the provisions of Rule 9(1)(b) of CENVAT Credit Rules, 2004 that CENVAT Credit is not admissible on a supplementary invoices where non-levy or short levy takes place on account of reason of fraud, collusion, or any willful mis-statement or suppression of facts. In case, the extended period is held to be invokable, then the recipient of the inputs will not be eligible for CENVAT Credit and in such a situation, it will .....

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in the present proceedings is whether the extended period of limitation under proviso to Section 11A of the Central Excise Act, 1944 is applicable and whether the demand within the period of limitation is demandable from the Appellant in view of the doctrine of revenue neutrality. 2. Shri P.M. Dave, learned Advocate appearing on behalf of the Appellant argued that the Appellant had cleared certain Cenvatable inputs under CT-3 certificates to their 100% EOU without reversal of CENVAT Credit. It .....

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er Rule 3 & 4 of the CENVAT Credit Rules, 2004. That only after the Larger Bench judgment of Chennai Bench in the case of Lakshmi Automatic Loom Works Ltd Vs CCE Trichy [2008 (232) ELT 428 (Tri-LB)], it was held that removal of inputs to 100% EOU require reversal of CENVAT Credit taken on the inputs. The learned Advocate did not argue the admissibility of CENVAT Credit on merit in view of the Larger Bench judgment mentioned above, but argued that the extended period cannot be made applicable .....

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ellant would have been admissible as CENVAT Credit to 100% EOU or refund was admissible to the 100% EOU under Rule 5 of CENVAT Credit Rules, 2004. It was his case that no demand is required to be confirmed within the period of limitation as per the following case laws:- i) Savita Polymers Ltd Vs CCE Raigad [2009 (240) ELT 616 (Tri-Mum)] ii) Motif India Pvt.Ltd. Vs CST Ahmedabad Order No.A/10297/2015, dt.20.03.2015 iii) Jayshree Instruments Pvt.Ltd. & Others Vs CCE Ahmedabad-III Order No.A/92 .....

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proceedings has mentioned in the invoices that the inputs are cleared as such, to their 100% EOU. On the issue of revenue neutrality, the learned Authorised Representative argued that as per Order of CESTAT Mumbai in the case of Automotive Stampings & Assemblies Ltd Vs CCE, Pune-I [2015-TIOL-836-CESTAT-MUM], revenue neutrality is not applicable on the ground that the recipient of the goods is eligible to CENVAT Credit. 4. As a counter to the arguments made by learned Authorised Representativ .....

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inputs under CT-3 certificate with due intimation/approval of the jurisdictional Central Excise officer and that in their case, the revenue neutrality will be applicable as per the order dt.03.07.2012 passed by this Bench in the case of Jayshree Instruments Pvt.Ltd. Vs CCE Ahmedabad-III. 5. Heard both the sides and perused the case records. The issue involved in the present proceedings is whether extended period of five years as per the proviso to Section 11A of Central Excise Act, 1944 is appli .....

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EOU. The Appellant was following the procedure of not reversing the CENVAT Credit under a bonafide belief that such a credit/duty is not required to be reversed/paid. Only after the Larger Bench judgment in the case of Lakshmi Automatic Loom Works Ltd Vs CCE Trichy (supra), delivered on 10.10.2008, it was held that CENVAT Credit taken by a DTA unit will be required to be reversed when the inputs are cleared as such to a 100% EOU. The period involved in the present appeal is from 2005-06 to Dece .....

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ecision of the Supreme Court in the case of Collector of Central Excise v. Solaris Chemtech Ltd. , 2007 (214) E.L.T. 481. The Tribunal however found that the show cause notice had admittedly been issued after the normal period of limitation; that during the relevant period, there was a decision of the Larger Bench of the Tribunal as well as of this High Court in favour of the assessee and was accordingly of the view that as such it cannot be said that there was any suppression or mala fide on th .....

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ficate by DTA unit to a 100% EOU. 6. In view of the above observations and settled proposition of law, the demand beyond the period of one year from the date of clearance is not sustainable and is required to be dismissed as time barred. 7. So far as the non-payment of demand within the period of limitation on revenue neutrality is concerned, the learned Authorised Representative relied upon the case law of Automotive Stampings & Assemblies Ltd Vs CCE, Pune-I (supra) to argue that revenue ne .....

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07.2012 passed by this Bench in the case of Jayshree Instruments Pvt.Ltd. Vs CCE Ahmedabad-III (supra), wherein following observations were made by this Bench in Para 3 of the order:- 3. We have considered the submissions made by both sides. We find that in this case, the appellant did not include the cost of inputs supplied by the principal even though they availed CENVAT Credit on the same and removed the goods manufactured for the principal manufacturer on payment of duty. We find that the fa .....

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e under-valuation was not sustained. Other decisions cited by the learned Counsel also support this view. As regards the decisions in the case of Jay Yuhshin Ltd (supra), in the case of Reliance Industries Ltd, it was cited and was not followed since the appeal filed by Jay Yuhshin Ltd in the Supreme Court was allowed, setting aside the demand and penalty. The issue involved in the case of Baba Asia Ltd, was entirely different as can be seen from the observation of the Tribunal If the duty was r .....

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ot sustainable on account of revenue neutrality by relying upon the judgment in the case of Commissioner, C.Ex. & Cus, Vadodara Vs Narmada Chematur Pharmaceuticals Ltd [2005 (179) ELT 276 (SC)] and Commissioner of C.Ex., Pune Vs Coca Cola India Pvt.Ltd [2007 (213) ELT 490 (SC)]. It is observed from the above case laws decided by the Hon ble Apex Court that it is not clear whether the extended period was invokable in these cases. It is further observed from the provisions of Rule 9(1)(b) of C .....

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