TMI Blog2021 (12) TMI 581X X X X Extracts X X X X X X X X Extracts X X X X ..... ble on the Coal specified under clauses (i), (ii), (iii), (iv), (v), (vi) and (via) and applied clause (vii) of Rule 3 of Cenvat Credit Rules. Tribunal has considered various decisions given by the different benches and also distinguished the decisions relied upon by the Revenue and concluded that the appellant is entitled for Cenvat credit in respect of 2% CVD paid under Notification No. 12/2012-Cus. Time Limitation - HELD THAT:- The issue involved is purely of interpretation of Cenvat Credit Rules, levy of CVD in terms of Customs Tariff Act. It is also the fact that on identical issue many cases were made out by the department across the country in respect of different assessees which clearly shows that the issue involved is of interpretation of law. In this situation, malafide intention cannot be attributed to the appellant. The appellant have been declaring availment of Cenvat credit in respect of 2% CVD and the same were reflected in monthly ER-1 returns. Therefore, there is absolutely no suppression of facts or mis-declaration etc. on the part of the appellant. Accordingly, the demand for extended period is not sustainable on the ground of time-bar also. The appell ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 12-Cus, appellant are not eligible for Cenvat credit. The Adjudicating Authorities, vide impugned orders confirmed the demand of Cenvat credit availed by the appellant and also imposed equal penalty. Therefore the present appeals filed by the appellants. 2. Shri Hardik Modh, learned Counsel appearing on behalf of the appellants submit that Section 3 of the Customs Tariff Act, 1975 levies duty equal to the excise duty, sales tax, local tax and other charges on the goods imported into India to off-set the levy of the taxes on the goods manufactured/ sold in India so that the imported goods are also at par in respect of the duty levied on such goods. He submits that mere perusal of Section 3(1) of Customs Tariff Act clearly reveals that Customs Tariff Act levies CVD which is only of Central Excise regime. At the relevant time the imported goods were subject to excise duty at the rate of 6% as per first schedule Central Excise Tariff Act, 1975. The exemption which was a concessional exemption with effective rate of 2% by Customs Notification No. 12/2012-Cus dated 17.03.2012. He submits that relevant entry under the Notification No. 12/2012-Cus is amended from time to time is an unco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arred. In support of merits of the case as well as time-bar, he placed reliance on the following judgments:- (a) Hindalco Industries Limited v/s. GST, Bhopal - 2018 (363) ELT 1085 (Tri-Delhi) (b) Lonsenkiri Chemicals Industries vs. C.C.E, Cus ST, Vadodara - 2019 (365) ELT 22 (Guj.) (c) Commissioner vs. Meghmani Dyes Intermediates Limited 2013 (288) ELT 514 (Guj.) (d) Commissioner of CE vs. Pragathi Concrete Products (P) Limited 2015 (322) ELT 819 (SC). (e) Simplex Infrastructures Limited vs. CST, Kolkata 2016-TIOL-779-HC-KOL-ST (f) Delhi International Airport Limited vs. Commissioner of CGST 2019 (24) GSTL 403 (Tri.) (g) Binjrajka Steel Tubes Limited vs. CCE 2016 (342) ELT 302 (Tri.) (h) CCE ST, Surat vs. Aarti Industries Limited - Final Order No. A/10390/2019 dated 22.02.2019 (i) Asahi Songwon Colors Limited vs. Commissioner of Central Excise ST., Vadodara - Final Order No. A/11585/2018 dated 09.07.2018 4. On the other hand, Shri Ghanshyam Soni, learned Joint Commissioner (AR) and Shri Vinod Lukose, learned Superintendent (AR) appeared on behalf of the appellants. They reiterates the findings of the impugned orders and also argued on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... E, dated the 17th March, 2012 is availed; .. .. (vii) the additional duty leviable under section 3 of the Customs Tariff Act, equivalent to the duty of excise specified under clauses (i), (ii), (iii), (iv), (v) [, (vi) and (via)]: (viii) .. 6. We find that in terms of clause (vii) of Rule 3(i) of Cenvat Credit Rules, Cenvat credit is allowed in respect of the additional duty leviable under Section 3 of Customs Tariff Act, 1975 equivalent to the duty of excise specified under clause (i). As per clause (i) of Rule 3(1), the duty of excise specified in the first schedule to the Central Excise Tariff Act, 1985 leviable under the Excise Act. In the present case, there is no dispute that the duty of excise is indeed specified in first schedule of Central Excise Tariff Act, 1985 which is leviable under the Excise Act. It is only by Customs Notification, the concession in rate of duty was provided i.e. @ 2% under Notification No. 12/2012-Cus. Only since the concessional rate is provided under Customs Notification, the nature of excise duty specified in the first schedule to the Central Excise Tariff Act does not get altered. The Adjudicating Authority has ignored the fac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y Notification issued under the Central Excise Act, 1944 is available to the assessee. Further, from the legal provisions as contained in Rule 3(1)(vii) of the Cenvat Credit Rules, 2004, it transpires that the assessee is eligible to take Cenvat Credit of the additional duty leviable under Section 3 of the Customs Tariff Act, 1975 equivalent to the duty of excise specified under clauses (i), (ii), (viii), (iv), (v), (vi), (vii) and (viia) of the Rule 3 ibid. The duty of excise on the coal imported by the assessee as specified in the first schedule to the Central Excise Tariff Act, 1985 is 6% and the effective rate is 1% or 2% vide Notification No. 12/2012-CE dated 17.03.2012, as amended, subject to the condition stated therein. In this case, 2% Additional Duty on imported steam coal/bituminous coal as per Notification No. 12/2012-Cus dated 17.03.2012 as amended by Notification No. 12/2013-Cus dated 01.03.2013 has been paid by the assessee. Further, it is found that the said duty of 2% is not specified under Central Excise Tariff Act, 1985 read with any notification issued under Central Excise Act, 1944 or rules made there under, therefore the credit of said duty of 2% paid as Addit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , (vii) and (via) . Thus, the notices are not legible to avail the credit of CVD equivalent to duty of excise if it is not eligible in clause (i). Any other meaning would be unfair for the local coal producers vis a vis imported coal, as if stand taken by notices is accepted, credit would not be available on indigenously procured coal but would be available on imported coal. This could never be the intention of legislature and therefore I do not find any substance or basis in the contention of the notices. 12. It would be appropriate to reproduce rule 3 of the CENVAT Credit Rules and it is as follows: RULE 3. CENVAT credit - (1) A manufacturer or producer of final products or a provider of output service shall be allowed to take credit (hereinafter referred to as the CENVAT credit) of - (i) The duty of excise specified in the First Schedule to the Excise Tariff Act, leviable under the Excise Act: Provided that CENVAT credit of such duty of excise shall not be allowed to be taken when paid on any goods- (a) in respect of which the benefit of an exemption under Notification No. 1/2011-C.E., dated the 1st March, 2011 is availed; or (b) specified in serial num ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2012 had been availed. In fact, Hindustan Zinc had paid additional duty of customs by availing the benefit under serial number 122A/123 of the Customs Notification dated March 17, 2012. It is because of this misreading of rule 3(1) of the CENVAT Credit Rules that led the Commissioner to commit an error. 15. The Regional Advisory Committee of Hyderabad Zone, in its meeting held on February 9, 2015 considered this very issue at point No. 1 and concluded that CENVAT credit of additional duty of customs paid on imported goods under Customs Notification dated March 17, 2013 (and not under Central Excise Notification) is available for credit. The relevant portion of the minutes is reproduced below: MINUTES OF THE MEETING OF THE REGIONAL ADVISORY COMMITTEE, HYDERABAD ZONE HELD ON FEBRUARY 09, 2015. Point No. 1 Credit on imported coal:- Many manufactures are importing steam coal on payment of duties. As per Customs Notification No. 12/2012-Cus. They are availing concessional CVD @ 2%. Audit is of the view that since CVD has been paid @ 2% on imported coal, the credit under Cenvat Credit Rules, is not available. Audit is taking a view that CVD in lieu of Excise duty and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... law, therefore, the extended period of limitation is not invokable. In that circumstances, the impugned order is set aside. 17. This decision of the Tribunal was subsequently followed by the Tribunal in Jaypee Sidhi Cement Plant and the relevant portion of the decision is reproduced below : 4 . It is submitted on behalf of the appellant that adjudicating authority below has wrongly made applicable the Notification No. 12/2012-C.E., dated 17-3-2012 to the facts and circumstances on a wrong presumption that the levy of CVD in dispute is since equal to the Excise duty leviable on the similar goods and manufactured in India, that the benefit of Customs Notification No. 12/12 has wrongly been denied vide Order. Learned Counsel has relied upon the decision of this Tribunal in the case of M/s. Hindalco Industries Ltd. vs. GST, Bhopal as was pronounced in Appeal No. E/50179/2018-SM vide Final Order No. 50876/2018, dated 8-3-2018 [2018 (363) E.L.T. 1085 (Tri.-Del.)]. Reliance has also been placed on another decision of the Tribunal in the case of Asahi Songwon Colors Ltd. v. CCE ST, Vadodara Appeal No. E/10635/2017-SM vide Final Order No. A/11585/2018 (Ahmd.), dated 9-7-2018. T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... /2012 is applicable only in respect of any digged or manufactured coal and not in respect of imported coal. The import whereof is allowed to have exempted rate of CVD vide Customs Notification No. 12/2012-Cus. 9 . In view of the entire above discussion, we are of the firm opinion that the adjudicating authority has committed a legal error while denying the benefit of reduced CVD on imported coal while placing reliance upon the Excise notification for manufacture of coal. (emphasis supplied) 18. The same view was taken by the Tribunal in Asahi Songwon Colors and the relevant paragraph is reproduced below: From the above Rule, it is observed that even if any duty is paid by availing exemption Notification No. 12.2012-CE dated 17.03.2012, the same will not be available as Cenvat credit for the user of the goods. In the present case, admittedly, the appellant have imported Coal and CVD of 2% is leviable in terms of Customs Notification No. 12/2012-Cus. There is no restriction provided in Rule 3 as regards duty paid under Customs notification. This restriction is applicable only in case of indigenous goods on which the excise duty @ 2% was paid availing Notification No. 12/ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ee however submitted that this proviso refers to CENVAT credit of such duty of excise . In the present case, what the assessee has paid was the countervailing duty. The same may have been computed in terms of excise duty payable on local manufacturers, nevertheless, the same cannot be treated as duty of excise per se. He however candidly a greed that facility for getting CENVAT credit in the case of the present assessee flows from rule 3 of the Rules. As per sub-rule (1) of rule 3, a manufacturer or producer of a final product or a provider of output service would be allowed to take the CENVAT credit on the duty of excise specified in the First Schedule to the Excise Tariff Act, leviable under the Excise Act. Sub rule (1) rule 3 which gives the concession of availment of CENVAT credit of the duty paid, also uses the same expression duty of excise as is used in the proviso which restricts or limits the right of availment of such facility under certain circumstances. The expression duty of excise used in clause (i) of sub-rule (1) of rule 3 and the above noted proviso to the said rule, must receive same interpretation. The term duty of excise cannot have different connotations ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the different benches and also distinguished the decisions relied upon by the Revenue and concluded that the appellant is entitled for Cenvat credit in respect of 2% CVD paid under Notification No. 12/2012-Cus. 8. On the issue of limitation, we find that the issue involved is purely of interpretation of Cenvat Credit Rules, levy of CVD in terms of Customs Tariff Act. It is also the fact that on identical issue many cases were made out by the department across the country in respect of different assessees which clearly shows that the issue involved is of interpretation of law. In this situation, malafide intention cannot be attributed to the appellant. The appellant have been declaring availment of Cenvat credit in respect of 2% CVD and the same were reflected in monthly ER-1 returns. Therefore, there is absolutely no suppression of facts or mis-declaration etc. on the part of the appellant. Accordingly, the demand for extended period is not sustainable on the ground of time-bar also. 9. As per our above discussion and findings, supported by Tribunal s decision in the case of Hindustan Zinc Limited (supra) and various decisions referred therein, the appellants are eligible ..... X X X X Extracts X X X X X X X X Extracts X X X X
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