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M/s. Steel Tubes of India Ltd. Versus CCE, Indore

2016 (2) TMI 684 - CESTAT NEW DELHI

Discharge the defaulted duty liability using cenvat credit - Held that:- The payment by credit which accrued after the impugned period was disputed by the Revenue. In this connection, we find that the Board vide Circular dated 15.12.2003 clarified that the amount of duty outstandings shall be treated as recoverable arrears of revenue and all permissible action under the law including action under Section 11 of the Central Excise Act, 1944 should be taken. Considering this amount, which was liabl .....

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AS HIGH COURT] . The Hon’ble High Court observed that right to pay the duty by using cenvat credit that on accrued amount cannot be denied unless it is a case of illegality or irregular credit. - Considering the above position, we find no justification for the Revenue to insist on payment of all the dues for the payment of all the defaulted amount by cash only when the appellants have accrued cenvat credit available in their accounts. As pointed out in the impugned order even in case of paym .....

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.03.2007 of Commissioner of Central Excise, Indore. The appellants are engaged in the manufacture of steel tubes liable to central excise duty. They were to discharge central excise duty on the goods cleared during a month by 5th of the following month. During the period, April 2005 to July, 2005 they have not paid the duty on due dates and defaulted with the payment of a total amount of ₹ 79,10,841/-, out of which, they have deposited ₹ 28,64,774/- through cash deposit in current ac .....

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s amount by cash, the amount already debited in cenvat credit account will be restored to the appellant. 2. Ld. Counsel for the appellant submits that the proceedings against them were not sustainable. Admittedly, they have defaulted in payment of central excise duty on a monthly basis during the period April, 2005 to July, 2005. However, they have full paid the defaulted amount on 26.07.2005, 12.08.2005 and 5.10.2005 by debit entries in their cenvat credit account. The provisions invoked by the .....

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ulted has been correctly paid by them. The payment using cenvat credit is permissible in the present case as the same is not used in the normal course of payment. In other words, the amount of arrears due to the Government is paid using partly the credit amount available in their accounts. The credits have been taken legally and there is no allegation about irregular credit etc. 3. Ld. AR, on the other hand, reiterates the findings of the Original Authority and states that the credit accrued dur .....

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