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2016 (9) TMI 141 - CESTAT MUMBAI

2016 (9) TMI 141 - CESTAT MUMBAI - 2016 (45) S.T.R. 389 (Tri. - Mumbai) - Rectification of mistake – maintainability – CENVAT credit – business auxiliary services – towers – BTS cabins – inputs – Passive Telecom Infrastructure – Held that: - once at the end of the ‘Supplier’ the Towers / BTS Cabins are assessed to Central Excise Duty by considering them as ‘excisable goods’ and the assessed Central Excise Duty has been collected, it is not open for the Central Excise authority at the end of the .....

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d jurisdiction to sit in appeal over the Final Order – rectification of mistake allowed – decided in favor of appellant. - ST/89464/13 - M/88911/16/STB - Dated:- 2-8-2016 - Mr. M.V. Ravindran, Member (Judicial) and Mr. C.J. Mathew, Member (Technical) Shri Atul Nanda, Sr. Advocate with Shri Sanjay Agarwal, Advocate for appellant Shri D. Nagvenkar, Addl. Commr (AR) for respondent ORDER The instant application is for seeking rectification of mistake in Final Order dated 22.08.2014 passed by the Tri .....

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, the Appellant Company is neither raising any issue on being aggrieved by any submission or finding recorded in the Final Order, nor is it seeking review of the said Final Order. The limited contention of the applicant as recorded in this rectification of mistake application is as follows- 3. However, consideration of the following submissions specifically argued and also contained in the Written Submissions dated 17.07.2014 filed on behalf of the Appellant in support of their case, do not refl .....

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as non-excisable, so as to deny Cenvat credit of duty paid on the same, without there being revision of assessment and refund of the duty paid at the end of supplier. 1. CCE VS MDS Switchgear LTD, 2008 (229) ELT 485 (SC); 2. MDS S Switchgear Ltd vs CCE, 2001 (132) ELT 405 (T-Mum.); 3. Owens Bilt Ltd vs CCE, 1098 (101) ELT 642 (T); 4. CCE vs UP State Sugar Corporation Ltd, 2013 (291) ELT 402 (T); 5. CCE vsHylite Cables, 2007 (212) ELT 284 (T); 6. Treadsdirectvs CCE, 2012 (286) ELT 583 (T); 7. CC .....

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is submitted that the above submissions may have been ignored, as the Appeal is allowed on other submissions. However, it would be desirable if findings, on these submissions which are backed by precedents, are inserted in the Final Order. The same would not amount to review and is only rectification of a mistake. P R A Y E R 6. The Applicant, therefore, respectfully prays - (i) that the consideration of the submissions on behalf the Appellant as set out in para 3 of the instant Application, ma .....

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ndered on behalf of the appellant before commencing arguments in support of the appeal. The issue was argued and during the course of hearing the compilation of aforesaid precedents was tendered in support of the arguments. It is submitted that therefore, non-consideration / not recording any finding on the above issue though permitted to be raised and argued before the Tribunal, was an error apparent from records. The Ld. Senior Counsel appearing for the Appellant has taken us through the findi .....

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tten submissions dated 11.07.2014 tendered by the applicant. He submitted that since this issue was neither contained in the appeal nor raised before the adjudicating authority, there was no error in not giving any finding on the issue. He submitted that only an error which is readily evident needs correction and it was not the case here. He submitted that a Departmental appeal is now pending against the Final Order before the Hon ble Bombay High Court, and the law point can be taken before the .....

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s. Commissioner of Central Excise, 2014 (303) ELT 336 (Bom.) 4.1 The Ld. DR further submitted that the Final Order is already in favour of the applicant and hence the precious judicial time may not be wasted on trivialities. From the written submissions tendered by the departmental representative in response to this ROM Application, it appears that the predecessor Bench, in which the Member (Technical) had been part of the Bench which delivered the Final Order dated 22.08.2014, was inclined to c .....

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the definition of input i.e. goods used for providing output service. Thus, the nexus of the goods with the output service should exist for considering it as input . Rule 3(1) of the Cenvat Credit Rules provides that credit can be taken on the strength of the invoice only after the goods have entered into the premises. This rule can only affect the time of taking the credit, provided the goods falls within the definition of input . He submitted that Duty is paid under a deeming fiction on Tow .....

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te of Andhra Pradesh Vs Bharat Sanchar Nigam Ltd - 2012 (25) STR 321 (AP). He also relied upon Mundra Port and Special Economic Zone Ltd Vs CCE - 2009 (13) STR 178 (Tri Ahd) and Gujarat State Petronet Ltd Vs CCE - 2013 (32) STR 510 (Tri Ahd). He tried to justify that the Final Order passed by the Tribunal was erroneous. He further submitted that the case laws cited in the Compilation II are on the point that credit cannot be reduced to the recipient of goods with reassessment of the duty paid by .....

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by both sides. 6. It is seen that the written submissions tendered on 11.07.2014 show amongst the issues to be determined, the following specific issue raised by the appellant- 2. Whether the appellants are entitled to Cenvat Credit of duty paid on the goods in question, in respect of which at the end of the supplier neither the assessment has been revised nor duty paid refunded to supplier? Para A(iii)(d) of the said written submissions dated 11.07.2014 also recorded the following submission o .....

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issue in hand as to whether for providing Business Auxiliary Service to a client Telecom Operator by operating, maintaining and providing Passive Telecom Infrastructure , the subject goods are inputs , which undisputedly were- (i) assessed to Central Excise Duty at the end of the supplier, and neither that assessment has been revised nor duty paid refunded to supplier, (ii) transported to the concerned place of the Appellants, and (iii) used for providing the said Output Service. And consequentl .....

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ime of personal hearing before the Tribunal. The Hon ble High Court also referred to a judgment of a Division Bench of the Hon ble Bombay High Court in Abhay Industries vs. Union of India, 2011 (269) ELT 330 (Bom.), wherein it was noted that most of the contentions which have been urged in the written submissions that were filed in respect of the arguments advanced before the Tribunal had not been considered and in that view of the matter the case was remanded. A judgment of the Hon ble Karnatak .....

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l Order, clearly show beyond any doubt that the above legal issue though raised and argued on behalf of the Appellant, was not considered and no findings were recorded thereon. Such error apparent from record needs to be rectified. 6.2 Although the Ld. DR suggests that this issue, on which findings have not been recorded in the Final Order, can also be raised by the appellant before the Hon ble High Court, however, we deem it just and expedient to allow the application for rectification of mista .....

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and Pre-fabricated Shelter/ Building i.e. under CETH 73082019 and 9406009 respectively. The Central Excise Tariff considers these items dutiable and excisable goods . (ii) Before removal of the same from its factory, the supplier had charged the Central Excise Duty by issuing a Central Excise Invoice and had discharged the duty liability. The Towers as well as Prefabricated Buildings are accordingly undisputedly assessed to Central Excise Duty at the end of the supplier . Thus, for the purpose .....

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elecom Service Provider / Telecom Operator . The Appellant is registered as Business Auxiliary Service Provider and provides services to its client Telecom Operators by operating, maintaining and providing Passive Telecom Infrastructure . (v) The Appellant on receipt of these goods takes credit of the Central Excise duty paid on the marketable and movable goods, purchased from the supplier and received for providing the said taxable output service . (vi) Only for providing the taxable output ser .....

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e with the submission of the Learned Senior Counsel for the Appellant that once at the end of the Supplier the Towers / BTS Cabins are assessed to Central Excise Duty by considering them as excisable goods and the assessed Central Excise Duty has been collected, it is not open for the Central Excise authority at the end of the recipient to question whether the goods are dutiable and excisable, for the purpose of denying cenvat credit of such duty collected by the department.Any subsequent determ .....

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tchgear LTD., 2008 (229) E.L.T. 485 (S.C.), the Hon ble Supreme Court was pleased to find no fault in inter alia the following findings recorded by the Tribunal- ….. If the department was of the opinion that the value of the final product was depressed, then they could have charged the Jalgaon unit with under-invoicing of their product. That has also not been done. The valuation as given by the Sinnar unit was duly approved by the department and the payment of duty was also duly accepted. .....

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ilts Ltd v CCE, Pune, 1998 (101) ELT 642, the Tribunal held that- 9. The decision of the Tribunal in Kerala State Electronic Corpn. v. CCE, Kochi - 1996 (84) E.L.T. 44 cited by the appellant is of significance. The bench in that case held that the recipient of the input was entitled to take Modvat credit of the duty paid on the inputs received by it, and the credit could not be restricted by the authority having jurisdiction over the recipient of the inputs on the ground that the duty paid was i .....

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e ought to have advised the Commissioner of Central Excise, having jurisdiction over Shamvik to initiate action under law to ensure that the appropriate authority pronounced that duty was not payable, take action to refund such duty, and thereafter resort to sub-rule (4) of Rule 57R, for ordering appropriate adjustment to vary the credit. None of these steps has been taken. 9. For the reasons as indicated above, we are of the view that credit was rightly taken. 6.8 In CCE v. U.P. State Sugar Cor .....

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he payment of duty is evidenced by the invoice issued by M/s. Jyoti Ltd., its Cenvat credit cannot be denied to the respondent. The only way to deny the Cenvat credit in this case would be to revise the assessment at the end of M/s. Jyoti Ltd., refund the duty paid by them and only in that case the Cenvat credit could have been denied to the respondent, but this has not been done. Without revising the assessment at the end of manufacture of some inputs, the Cenvat credit cannot be denied at the .....

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iew of this, I do not find any infirmity in the impugned order. Revenue s appeal is dismissed. 6.9 In CCE v. Hylite Cables - 2007 (212) ELT 284, the Tribunal held that- 3. I find that the Revenue is not disputing the fact that duty stand paid by the supplier. The same has not been refunded to him. The respondents have taken credit of the duty paid by the supplier. As such there is no revenue loss and the entire situation is revenue neutral. It is further noticed that the Revenue is not agitating .....

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Switchgear Ltd. - 2008 (229) E.L.T. 485 (S.C.), Commissioner v. Hylite Cables - 2007 (212) E.L.T. 284 (Tri.-Ahmed.), etc. The ratio of these decisions is that any duty actually paid (whether or not payable) on input which has been received in the factory of the manufacturer of final product and used in or in relation to manufacture of the final product must be allowed as MODVAT/CENVAT credit to be utilized for payment of duty on the final product. It also emerges from the cited decisions that qu .....

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e duty is levied on an assessee at place A and Modvat credit is sought to be availed of at place B , it is open to the Authorities at place B to deny credit on the ground that no duty was payable at place A . 3. We have accordingly re-framed question no. 4 at the time of admission of the appeals as above in all these cases. The common facts are that job works were undertaken at one place outside Goa and excise duty was paid on the goods before removing them from that place. These goods were brou .....

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view that the point is covered by a decision of the CEGAT judgment in the case of Owens Bilt Ltd. v. Commissioner of Central Excise, Pune reported in 1998 (101) E.L.T. 642 and therefore, dismissed the appeal filed by the Revenue. 5. Mr. Ferreira, learned Assistant Solicitor General for the appellant, submitted that the scheme of law is that if, excise duty is collected, a person at subsequent place is entitled to claim Modvat credit. According to Mr. Ferreira, learned Assistant Solicitor General .....

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