TMI Blog2021 (11) TMI 830X X X X Extracts X X X X X X X X Extracts X X X X ..... Appellant Shri N.N. Prabhudesai, Supdt., Authorized Representative for the Respondent ORDER Per: Ramesh Nair The brief facts of the case are that the appellants are availing CENVAT Credit of the Central Excise duty paid on inputs, capital goods and Service Tax paid on input services under the provisions of CENVAT Credit Rules, 2004. During the scrutiny of the Cenvat documents, it was observed that there is variance in the inventory of the Cenvat inputs maintained by the appellants. The value of net shortages in the input inventory for the period April, 2010 to October, 2010, worked out to ₹ 1,18,95,547/- and the Cenvat credit in respect of such shortages worked out to ₹ 12,25,242/-. A show-cause notice dated 27.04.2011 was issued and the same was adjudicated by the Additional Commissioner of Central Excise, Pune-I vide Order-in-Original dated 20/27-01-2012, vide which he has confirmed the recovery of inadmissible credit of ₹ 12,25,242/-, recovery of interest and also imposed penalty. Being aggrieved by the said Order-in-Original, the appellants filed an appeal before the Commissioner (Appeals), who has upheld the Order-in-Original dated 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t: - (i) Commissioner of Central Excise, Indore Vs. Kashyap Sweetners Ltd. 2006 (193) ELT 108 (Tri-Del) (ii) Commissioner of Central Excise, Aurangabad Vs. Greaves Cotton Ltd. 2008 (225) ELT 198 (Bom) (iii) Spentex Industries Ltd. Vs. Commissioner of Central Excise, Indore 2010 (253) ELT 225 (Tri- Del) (iv) Philips Carbon Blck Ltd. Vs. Commissioner of Central Excise, Bolpur 2013 (29) STR 217 (Tri- Kol) (v) Micro Tipes Pvt. Ltd. Vs. Commissioner of Customs, Bomaby- 1998 (104) ELT 76 (Tri). 5. We have carefully considered the submissions made by both sides and perused the records. 6. We find that in the facts and circumstances of the present case the shortages and excesses if any found are theoretical due to huge quantity of inputs handling. It is not a case of the Department that the appellant have ever removed any Cenvat inputs without payment of duty from their factory. Therefore, even though there is any shortage or excess, the input was available within the factory premises or consumed in the production. This issue has been considered by this Tribunal in the appellant s own case as follows: - (i) Tata Motors Ltd. Vs. Commissioner o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ngly whereas in the present matter the Cenvat credit was rightly taken on eligible inputs upon their receipt. Learned Authorised Representative on the other hand reiterated the findings recorded in the impugned order and prayed for dismissal of Appeal. According to learned Authorised Representative the appellants are liable to pay an amount equivalent to Cenvat Credit taken on inputs allegedly written off in terms of Rule 3(5B) ibid alongwith interest and penalty, as it categorically states that an amount equivalent to the Cenvat credit taken on input written off is payable by the assessee. He denied the contention of learned counsel that those parts which were not available during physical stock verification at its specified storage rack were subsequently found in another storage rack. 4. Rule 3(5B) ibid specifically provides that If the value of any input or capital goods before being put to use, on which CENVAT credit has been taken is written of fully or where any provision to write off fully has been made in the books of accounts, then the manufacturer or service provider, as the case may be, shall pay an amount equivalent to the CENVAT credit taken in respect of the said i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a Motors Ltd. Vs. CCE, Pune-1; reported in 2016-TIOL-1027- CESTAT-MUM while relying upon the law laid down by the Hon ble Supreme Court in the matter of Maruti Suzuki India Ltd.; 2015(319) ELT 549 (SC) decided the issue in favour of the Appellants. Similarly in another matter of Appellants i.e. Appeal No. E/172/2009 in the matter of M/s. Tata Motors Ltd. Vs. CCE ST, Jamshedpur, a coordinate Bench of the Tribunal vide Order dated 11.1.2019 decided the issue in favour of the appellants therein and held that the demand is not sustainable and there is no evidence on record that the inputs on which the Credit was taken, were not received in the factory or removed as such from the factory. 6. While following the decisions as cited above and in view of the facts of this case and also in view of the discussions made hereinabove, we are inclined to set aside the impugned order and accordingly the appeal filed by the appellants is allowed with consequential relief as per law, if any. (ii) Tata Motors Ltd. Vs. Commissioner of Central Excise 2017 (345) ELT 653 (T) 5. I find that there is discrepancy in the inventory of input on which Cenvat credit being taken by the appellant but di ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... I find that the Order-in-Original clearly records that the appellants have elaborate method of accounting. There is no allegation of any mischief in the shape of clandestine clearance of receipt of raw materials. The Tribunal in case of Maruti Udyog has observed as follows: - 7. The appellants have a huge and complex accounting problem. It is beyond manual tally. The appellants have put in place sophisticated computer based accounting systems to ensure accuracy and efficiency. The evidence on record does not indicate any diversion of inputs in contravention of rules relating to utilisation of inputs. The demand is merely based on the shortages detected during physical tallying, that too without taking into account the excesses noticed. Since there is no evidence, that the excesses are not the result of clandestine receipt of inputs, the same view is required to be taken in regard to shortages also, that the shortages are not the result of any clandestine or unauthorised utilisation of the inputs. The shortages thrown up also do not account for much. The appellants Management as well as its auditor have accepted the differences between the physical stocks and the procurement as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uti Suzuki, value of excess found was greater than the value of shortages, whereas in the instant case the value of shortages is higher than the value of excess. In so far as the value of shortages ranging from 0.01% to 0.21% whereas the excess ranging from 0.01% to 0.08% of the total procurement of parts. I find that the Tribunal in its decision in case of Maruti Udyog Ltd. (supra) has not relied on quantum of shortages are excess, but has relied solely on minuscule percentage of shortages found. The Hon'ble Supreme Court also has relied on the percentage of shortages found. However, as an additional argument, the Hon'ble Supreme Court has observed that the fact that shortages of input was less than the excess of input found demonstrate the bona fide. 5. In view of the above, I find that the issue is squarely covered by the decision of the Hon'ble Supreme Court in case of Maruti Suzuki India Ltd. (supra). The impugned order is set aside and appeal is accordingly allowed. 7. From facts of the three cases cited above, it can be seen that the same facts and circumstances existing in the present case, even though there is some theoretical variation in the inputs was ..... X X X X Extracts X X X X X X X X Extracts X X X X
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