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2019 (8) TMI 672

..... ds in question) to the production floor prior to the proceedings before this Tribunal. I agree with the submissions made by the Ld. DR that factual submissions being made for the first time before the Tribunal cannot be entertained. The Tribunal being an Appellate Authority cannot be presented with different or additional set of facts as compared to the facts presented before the lower authorities. Therefore, it is not possible to test the veracity of the additional factual submissions of the Appellant at this stage. The Chartered Engineer’s report and SAP records do not aid the case of the Appellant in view of the above reasons - the duty amount of which credit was availed before the fire incident in August 2011, has already been reversed in May 2015 which has been duly recorded in the impugned order on Page no 6. Therefore, the duty amount already stands paid by way of reversal of credit which is not in dispute. Demand of Interest and penalty - HELD THAT:- The Ld. Commissioner has recorded that the Appellant had sufficient credit balance in its account. Based on the applicable provisions under Rule 14 of the CENVAT Credit Rules, as was in force during the period April 2012 .....

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..... t on 10/08/2011 due to which certain packing material required for finished goods were damaged. The Appellant had taken CENVAT Credit on such packing material considering them to be inputs. The Appellant received certain amount from the insurance company towards the said loss, which was accounted for by the Appellant in its Books of Accounts for the FY 2012-13. 4. During audit of the Appellant s records for the relevant period, the Departmental officers observed that the Appellant had taken irregular credit of ₹ 2,76,514/-, as the Appellant was liable to reverse the said amount of duty on the packing material destroyed in the fire. Accordingly, the Appellant was issued Show Cause Notice dated 28/07/2015, which was confirmed by Order-in-Original dated 26.08.2016. The Appellant preferred an appeal before the Commissioner (Appeals), which was rejected. Hence, the present appeal before the Tribunal. 5. The Ld. C.A. appearing for the appellant submitted that the packing material, which were damaged in the fire, were kept at the Production Floor, as such material had already been issued from the Appellant s stores. It was contended that on a conjoint reading of Rule 3 and Rule 2(k) .....

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..... , submitted that the Tribunal should not take into cognizance the submissions being made on the factual aspect which was never before the lower authorities. Further, he reiterated the observations of the lower authorities. 8. Heard both sides and perused the appeal records. 9. The short issue that arises for consideration in the instant appeal is with respect to availment of CENVAT Credit of excise duty paid on the packing material destroyed in the fire at the Appellant s factory on 10/08/2011. On perusal of the appeal records, it is seen that the Appellant had never stated the fact of having issued the packing material (goods in question) to the production floor prior to the proceedings before this Tribunal. I agree with the submissions made by the Ld. DR that factual submissions being made for the first time before the Tribunal cannot be entertained. The Tribunal being an Appellate Authority cannot be presented with different or additional set of facts as compared to the facts presented before the lower authorities. Therefore, it is not possible to test the veracity of the additional factual submissions of the Appellant at this stage. The Chartered Engineer s report and SAP recor .....

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..... rules taken during the month has been utilised next; (iii) credit inadmissible in terms of these rules taken during the month has been utilised thereafter. . The aforesaid provision contained in sub-rule (2) of Rule 14 got omitted from the statute, w.e.f. 01.04.2016, vide Notification no. 13/2016-C.E (NT) dated 01.03.2016. 13. On perusal of the above provisions, I find that the Ld. Commissioner has committed a fundamental error in applying the said amended provisions since the same would apply in those cases where it is to be ascertained whether the credit is deemed to be utilized in March 2015 in respect of the credit amount availed in March 2015, i.e. both availment and utilization of credit during the period after the amendment took place. The aforesaid provisions brought into effect on 14th March, 2015 cannot be applied (retrospectively) for the credit amount already shown in the returns prior to March 2015 (i.e. August 2011 when the fire incident occurred). 14. Be that so as it may, the concept as to when can it be said that credit has been taken , has been lucidly explained by the Hon ble Karnataka High Court in the case of CCE vs. Bill Forge Pvt Ltd. 2012 (26) STR 204 (Kar) .....

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..... y amended, wherein it has been clearly stated as taken and utilised . Therefore, it is quite clear that mere taking itself would not compel the assessee to pay interest as well as penalty. Further, as pointed out earlier, the subsequent amendment has given befitting answer to all doubts existed earlier. Since, the subsequent amendment has cleared all doubts existed earlier in respect of Rule 14 of the said Rules, it is needless to say that the argument advanced by the learned counsel appearing for the appellant/Department is erroneous, whereas the argument advanced on the side of the respondent is really having merit and the substantial questions of law settled in the present Civil Miscellaneous Appeal are not having substance and altogether the present Civil Miscellaneous Appeal deserves to be dismissed. 17. Further in CCE, Delhi vs. Maruti Udyog Limited [2007 (214) E.L.T. 173 (P & H)], the Hon ble High Court upheld the findings of the Tribunal that the assessee was not liable to pay interest as the credit was only taken as an entry in the Modvat record and was not infact utilised. The Tribunal held that in absence of utilisation of credit, the assessee was not liable to pay i .....

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..... mp; Haryana High Court, Special Leave to Appeal (Civil) No. CC3915/2007 filed by Commissioner of Central Excise, Delhi-III has been rejected by the Apex Court on 14-5-2007 [2007 (214) E.L.T. A50 (S.C.)]. The decisions cited by the learned Additional Chief Standing Counsel are distinguishable and do not apply to the facts of the present case. In the case of Commissioner of Central Excise, Pune v. M/s. SKF India Ltd. (supra) it has been held that on revision of prices retrospectively invoices were issued and differential duty was paid. It has also been held by the Apex Court that payment of differential duty clearly falls under Section 11A(2B) of the Act and hence interest is chargeable under Section 11AB of the Act. Similar view has been taken in the case of Commissioner of Central Excise v. M/s. International Auto Limited (supra). 10. For the reasons stated above, we are of the view that there is no error in the order of the Tribunal. The appeal is accordingly dismissed summarily... 20. In view of the above factual perspective and the precedent decisions of various High Courts, I am of the view that since the appellant had sufficient credit balances as noted above, in any case, the .....

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