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2016 (6) TMI 826 - CESTAT HYDERABAD

2016 (6) TMI 826 - CESTAT HYDERABAD - TMI - Cenvat Credit availed MS angles, HR Plates, MS channels etc. as capital goods - MS items were used for manufacture of various parts/components/accessories/spares of capital goods within the factory or for repairs and maintenance of capital goods. - Extended period of limitation - Held that:- The appellant has disclosed the availment of credit in the ER-1 returns and also in the Cenvat credit statements. Further, the show cause notice itself relies upon .....

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d cannot be invoked as there is no wilful suppression or collusion with intent to evade payment of duty. - The show cause notice is time barred. The appellant succeeds on the ground of limitation. - Decided in favor of assessee. - Appeal No. E/27183/2013 - A/30377/2016 - Dated:- 5-5-2016 - Ms. Sulekha Beevi, C.S. Member ( Judicial ) Shri R. Muralidhar, Advocate for the Appellant Shri V. Ramakrishna, AR for the Respondent ORDER [ Order per Sulekha Beevi, C. S. ] 1. The appellants are engaged .....

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; 19,24,184/-. The appellants defended the show cause raising the ground of limitation as well as on merits. After due process of law, the original authority confirmed the demand along with interest and imposed equal amount of penalty. In appeal, the Commissioner (Appeal) vide order impugned herein upheld the order of the original authority. Hence this appeal. 2. The learned counsel for the appellant advanced his arguments both on merits as well as on the ground of limitation. With regard to mer .....

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The learned counsel submitted that the demand is hit by limitation as there is no evidence to prove suppression of facts or wilful misstatement. The appellants had disclosed the details of credit availed in their ER-1 returns. There is no column in ER-1 return to indicate the description of item/input on which credit is availed. The department alleges non-mention of the details of input item to be suppression of facts which is not legal or proper. That as there is no suppression of facts the ext .....

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notice has been issued invoking larger period basing upon the decision of Larger Bench of Tribunal in Vandana Global Ltd case 2010(253) ELT 440(Tri-LB). He submitted that the amendment brought w.e.f. 07-07-2009 has prospective application only, and that therefore, credit is admissible. To fortify his arguments, he relied upon the judgment laid in Mundra Ports & SEZ Ltd Vs CCE 2014(39) STR 726(Guj), CCE,Jaipur Vs Rajasthan Spinning and Weaving Mills Ltd. 2010(255) ELT 481(SC), India Cements .....

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capital goods fabricated in their ER-1 returns. Hence the appellant has suppressed facts and the show cause notice issued invoking the extended period is legal and proper. He submitted that credit is not admissible and that the Commissioner (Appeals) has rightly upheld the confirmation of demand, interest and penalty imposed. 5. I have considered the submissions made by both sides. The issue to be answered is whether the credit is admissible on MS items used for fabrication of parts/components/ .....

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f one year is proper. I am not convinced with these submissions. The appellant has disclosed the availment of credit in the ER-1 returns and also in the Cenvat credit statements. Further, the show cause notice itself relies upon ER-1 returns and the information furnished by appellant. The appellant has also produced photographs and certificate issued by chartered engineer as to the use of MS items in fabrication of capital goods, and these in turn are used for manufacturing finished product. In .....

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n Ultratech Cement Ltd Vs CCE, Raipur 2016(332) ELT 356(Tri Del) where the grounds of limitation are akin to the facts of this case, held that extended period is not invokable. The Tribunal in the said case observed as under: 10. The Supreme Court in the case of Continental Foundation Jt. V. Commr. Of C.Ex., Chandigarh-1 reported in 2007(216) ELT 177 (SC) held that the expression suppression has been used in the proviso to Section 11A of the Act accompanied by very strong word as fraud or collus .....

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f suppression is required for invoking larger period of limitation under Section 11A. The Hon ble Supreme Court in the case of Jai Prakash Industries Limited V. Commissioner of C.Ex., Chandigarh 2002(146) ELT 481 (SC) held that in the case of divergent views of the various High Courts there was a bona fide doubt as to whether or not such activity amounted to manufacture. In such situation, the extended period cannot be invoked. In Uniworth Textiles Ltd. V. Commissioner of Central Excise, Raipur .....

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The Tribunal in the case of Accurate Chemicals Industries V. Commr. Of C.Ex., Noida 2014(300) ELT 451 (Tribunal-Delhi) examined the scope of scrutiny of ER-1 returns by the departmental officers. The Tribunal held, after examining the instructions issued by the Board from time to time, that returns filed by the assessee are required to be subject to detailed scrutiny in course of which the concerned officer can call for documents from the assessee wherever necessary for the scrutiny. In the pres .....

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