TMI Blog2015 (9) TMI 1267X X X X Extracts X X X X X X X X Extracts X X X X ..... under the first schedule or the second schedule to the Excise Tariff Act. In other words, the restriction introduced by the explanation was only in the utilization of the accumulated credit of AED towards payment of duty under the schedules of Excise Tariff Act. This means that this restriction applied only in the payment of BED and SED, which alone is payable under the Excise Tariff Act and not to AED payable under Section 3 of Act 58 of 1957 - Decided against Revenue. - C. E. Appeal. No. 2 of 2013 - - - Dated:- 20-7-2015 - Antony Dominic And Shaji P. Chaly, JJ. For the Petitioner : Sri John Varghese, SC Cen Board of Excise For the Respondent : Sri Joseph Kodianthara (SR) Adv, Sri V Abraham Markos, Sri Binu Mathew, Sri Abraham Joseph Markos, Sri Tom Thomas (Kakkuzhiyil), Sri Isaac Thomas, Advs JUDGMENT Antony Dominic, J. 1. These appeals are filed by the Commissioner of Central Excise, Customs and Service Tax, Kozhikode and Kochi. They are aggrieved by the orders passed by the Customs, Excise and Service Tax Appellate Tribunal, South Zonal Bench, Bangalore in Appeal Nos.E/298/2010 E/1080/2010. 2. We heard the Standing Counsel for the appellants and t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to June 2008. Upon payment of each installment, equivalent credit of AED was restored by them to their CENVAT account and this was reflected in the relevant returns. 7. Thereafter, the respondent in C.E. Appeal No.2 of 2013 utilised the accumulated credit of AED for payment of AED on DNTCF manufactured from NTCF prior to 01.04.2000. In so far as the appellant in C.E. Appeal No.3 of 2013 is concerned, out of the accumulated credit of AED, an amount of ₹ 16,76,148/- was utilized by them. Further as DNTCF was used captively in the manufacture of tyres, the credit of AED paid on DNTCF was also taken by them and utlised for payment of BED and SED on tyres. 8. In this factual back ground, show cause notices were issued to the respondents alleging wrong restoration of AED credit in the CENVAT Credit Account and also its wrong utilization for payment of AED on DNTCF. Replies were filed by them disputing the allegations and also relying on order dated 28.02.2007 passed by the Commissioner of Central Excise, Mumbai III in the case of M/s. CEAT Ltd., and also on the Tribunal's decision in Good Year (India) Ltd. v. CCE, Faridabad [2006 (199) E.L.T 842 (Tri.Del.]. 9. The adju ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 73/- every month from July, 2005 to June, 2006. On payment of BED from PLA the appellant took suo motu credit of equal amount in the AED (GSI) account. Through the impugned proceedings, the department sought to disallow credit taken by the assessee under AED (GSI) account on the ground that the same was taken against TR.6 Challans and not against valid documents prescribed under the Rules. The proper procedure to take re-credit of Cenvat credit wrongly used was to file refund claim under Section 11B of the Central Excise Act. Vide the impugned order, the Commissioner held that the appellants were entitled to restoration of the AED (GSI) equal to the amount it paid towards BED on tyres, which had been initially discharged using accumulated credit under AED (GSI) available as on 1-3-2003. 6. Under Sec. 88 of the Finance Act, 2004, the following Explanation was introduced in Rule 3(6) (b) of Cenvat Credit Rules, 2004 effective from 1-3-03 : Explanation - For the removal of doubts, it is hereby declared that the credit of the additional duty of excise leviable under section 3 of the Additional Duties of Excise (Goods of Special Importance) Act, 1957 (58 of 1957) and paid o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it, the Tribunal held that duty was to be paid from PLA or in cash. When the duty was so paid, the Modvat credit which was utilized wrongly had to be restored. Its utilization for payment of duty for an eligible product could not be objected to. (ii) In the Mahindra Mahindra Ltd. case, dealing with a similar case of utilization of Modvat credit towards payment of duty on I.C. engines and M.V. parts, which had not been declared as final product by the assessee, the Tribunal held that while duty involved on I.C. engines and M.V. parts could be ordered to be paid through PLA that had to be simultaneous with restoration of an equivalent amount in RG-23A Part II for utilization towards the duty on the declared final product viz. motor vehicles. (iii) In Punjab Maize Products case supra, the Tribunal granted the relief of restoration of the credit which had been held by the authorities to have been wrongly utilized for payment of duty on glucose for which the particular raw material in question had not been declared as the input. The Tribunal held that the application made for restoration of the credit which had been admittedly utilized wrongly should be allowed once the re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to be followed for getting back such excess duty paid. Ratio of that case does not apply to the subject case. 9. The impugned credit had been legitimately earned by the assessee on procurement of inputs on payment of duty and used for payment of duty following the amendment of Cenvat Credit Rules under Budget 2003. Vide Circular No. 7/16/2003-C.X., dated 6-3-03, the CBEC had also clarified that it was considered appropriate not to put any cap on the use of the AED (GSI) credit accruing prior to 1-3-2003. In terms of the provisions enacted in Finance Act, 2004, the debits were held not amounting to payment of duty and the assessee was required to meet the same obligation by payment from PLA. In the instant case, the debits were held to be of no consequence when the assessee was required to pay duty initially discharged using AED (GSI) credit. Therefore, the credit needed to be restored and was correctly ordered so by the Commissioner. We find considerable merit in the finding of the Commissioner that but for the statutory changes introduced with effect from 1-3-03 following which the assessee had discharged the duty liability on tyres using AED (GSI), it would have continued ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ore, this contention raised by the counsel for the appellants cannot be accepted. 15. Learned counsel for the appellants contended that the order passed by the Delhi Tribunal which was confirmed by the High Court of Punjab and Haryana, was challenged before the Supreme Court and that while dismissing the SLP on the ground of delay, the question of law raised was kept open. He had also produced before us the order passed by the Apex Court to substantiate this contention. According to him, therefore, the order of the Tribunal and the judgment of the Punjab and Haryana High Court has lost its efficacy. We are unable to agree. When dismissing the SLP, if the question of law raised is kept open by the Apex Court, that does not mean that the conclusion of the Tribunal or the principles laid down by the High Court, are set at naught. Instead, it only means that it is open to the appellant to raise the same issue before the Apex Court, without being constrained by the earlier order dismissing the SLP. Therefore, we cannot accept the contention that the Order of the High Court of Punjab and Haryana or the order of the Tribunal which was confirmed by the High Court, could not have been of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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