Contact us   Feedback   Annual Subscription   New User   Login      
Tax Management India .com
TMI - Tax Management India. Com
Extracts
Home List
← Previous Next →

2016 (10) TMI 820 - CESTAT HYDERABAD

2016 (10) TMI 820 - CESTAT HYDERABAD - TMI - Input credit - LSHF-HSD - whether the appellants are eligible to avail CENVAT Credit on Low Sulphur High Flash - High Speed Diesel Oil keeping on view that LSHF HSD is nothing but HSD with a different flash point and specific content of sulphur and hence the same is nothing but HSD, which is excluded from the definition of “input”? - classification of goods - interpretation of law - Held that: - the definition of input in 2 (k) of CENVAT Credit Rules, .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

he word High Speed Diesel in the definition of input will therefore necessarily have to harmonize with the tariff entry and heading of the same item in the said Central Excise Tariff Act. This being so, HSD and all its variations including LSHF-HSD, will be in the same footing, for the purposes of Rule 2(k) of CENVAT Credit Rules 2004. Consequently, HSD and all its variations including LSHF-HSD, will be excluded from the ambit of input defined in the said Rule 2(k). - Extended period of limi .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

f the considered opinion that for the periods during which the appellant had indicated the description of the product/input as LSHF-HSD or LS/HF HSD, the department cannot allege suppression and hence any demand of duty for the said irregular availment of credit will be barred by limitation. Whereas, during the period in which the appellant had merely described the product/input as ST 6733, in our view would amount to suppression/and mis-declaration of vital facts and the department is well with .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

icable - decided in favor of Revenue. - E/362/2008 - Final Order No. A/30764/2016 - Dated:- 26-8-2016 - Ms. Sulekha Beevi, C.S., Member (Judicial) and Sh. Madhu Mohan Damodhar, Member(Technical) Sh. Mihir Mehta, Consultant for the Appellant. Sh. Arun Kumar, Deputy Commissioner (AR) for the Respondent. ORDER The issue involved is whether appellant is eligible for input credit on LSHF-HSD. 2. The Appellant is engaged in manufacture of Lubricants falling under Chapter sub heading 2710 1930 of the C .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

59/- with interest thereof and imposition of penalties. 4. The grounds for issue of notice can be summarized as under: High Speed Diesel (HSD) was specifically excluded from the definition of input under CENVAT Credit Rules, 2004 and that LSHF HSD is nothing but HSD with a different flash point and specific content of sulphur and hence the same is nothing but HSD, which is excluded from the definition of input . Appellant wilfully did not mention the correct description of the input and delibera .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

e used the prefix Low Sulphur High Flash Diesel . The input received is a special grade diesel oil referred to as LSHF, which is different from HSD used in automobiles and hence does not fall in the excluded category of inputs. Reliance was placed on: Comparative chart submitted - laying down the key differentiators between LSHF -HSD and HSD BIS Specification Batch wise Test Reports of IOCL Report issued by Geo - Chem Laboratory Screen shot from the web-site of Bharat Petroleum Company Ltd. Fini .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

, that the product LSHF-HSD is used as an additive in the process of manufacturing lubricants under their brand name Eco 2T oil; that LSHF-HSD works as a dilutive and reduces the viscocity of the polyisobutme, which is another additive present in the Eco 2T oil. Ld. Counsel further submitted that in case of classification disputes, the department cannot rely solely on an audit observation for issuing a demand notice, without carrying out further investigation, as per the ratio of Swastik Tin Wor .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

Tribunal held as follows: We cannot even agree with the reasoning of ADC that LSHF HSD is a variant of HSD oil. The various GOs issued under the Act itself reveal this. Under GOMs No.308 Revenue (CT-II) Department dated 3.05.2001 both High Speed Diesel (HSD) Oil and Light Diesel Oil are separately enumerated. If all variants of HSD Oils are covered under the expression HSD Oil there is no need to separately mention the super light diesel oil even under item 16 of G.O.Ms 367 Revenue (CT-II) Depa .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ly substitutable commercially on sustainable basis. They have different names, characters and used. The sellers and users of these commodities are also different. Hence they are not the same commercial commodities. The issue involved is that of interpretation of law. Based on the aforesaid technical submissions and the judgement of the Honourable Sales Tax Appellate Tribunal, the Appellant were under the bonafide belief that CENVAT Credit was admissible on the Excise duty paid on LSHF-HSD. It is .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ecimen copies of the returns are attached in the appeal compilation. Ld. Counsel finally submitted that penalty under Rule 26 of the Central Excise Rules is applicable only when the concerned person knows or has reasons to believe that the goods are liable for confiscation. In the present case, there is no proposal for holding the goods liable for confiscation and hence the penalty under Rule 26 of the Central Excise Rules, 2000 is not applicable in the present case. 7. On behalf of department M .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

alia, High Speed Diesel Oil (HSD) from the meaning of input. It is further seen that in the Central Excise Tariff Act, 1985 the classification of HSD is 2710 19 30. There is no separate sub-classification for LSHF-HSD. This implies that HSD and all its variations will necessarily be classified under the said heading only. The input invoices of LSHF-HSD from Indian Oil Corporation Ltd., also clearly classify the said items under CTH classification 2710 19 30 only. The use of the word High Speed D .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

n merits the appellants do not have a case and the authorities below have been correct in holding that input credit cannot be availed on LSHF-HSD. The case laws produced by the appellant are on totally different issues and therefore not applicable. 11. However, on the issue of limitation, the appellants contentions do have merit. It is not the case that the appellant had not submitted statutory returns disclosing the necessary details. In fact, on going through copies of RT-12 submitted by the a .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

 

 

 

 

 



|| Home || Acts and Rules || Notifications || Circulars || Schedules || Tariff || Forms || Case Laws || Manuals ||

|| About us || Contact us || Disclaimer || Terms of Use || Privacy Policy || TMI Database || Members || Site Map ||

© Taxmanagementindia.com [A unit of MS Knowledge Processing Pvt. Ltd.] All rights reserved.

Go to Mobile Version