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TMI Blog2023 (11) TMI 59X X X X Extracts X X X X X X X X Extracts X X X X ..... y. On the basis of CAG Audit, it was alleged that the appellants have manufactured and cleared Hemophilus Vaccine which is duty free and thus were required to reverse 10% of the value of the exempted goods in terms of Rule 6(3) of CCR, 2004; a show-cause notice dated 17.12.2012 was issued to the appellants and was confirmed vide OIO dated 29.11.2013; on an appeal filed by the appellants, CESTAT vide Final Order No. A/52883/2015-EX (DB) dated 14.09.2015 remanded the case back for de novo adjudication with the direction to ascertain whether the appellant is manufacturer of the vaccine, cleared duty free, which is in question. In the de novo proceedings, Commissioner vide Order dated 18.05.2017 has upheld the demand of Rs.1,65,92,802/- against ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rongly, Rule 14 of the Cenvat Credit Rules, 2004 empowered the authorities to recover such credit which had been taken or utilised wrongly along with interest; however, the second respondent did not choose to exercise power under this Rule but relied upon Rule 6(3)(i) and made the choice of the option thereunder for the petitioner, viz., to pay 5%/6% of the value of the exempted services; the statutory scheme did not vest the second respondent with the power of making such a choice on behalf of the petitioner; the Order-in-Original, to the extent that it proceeded on these lines, therefore cannot be countenanced" which was also followed by the Tribunal in the cases of M/s SPAC Taopica Products (India) Ltd.- 2023 (9) TMI 715- CESTAT-Chennai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... further states that the show-cause is based on the entries made in RG-1 and RG-23A registers and therefore, the Department cannot allege that the fact was not in the knowledge of the Department and therefore, extended period cannot be invoked in view of the following cases: * CCE Vs ITC Ltd.- 2013 (291) ELT 377 * Praj Ind. Ltd.- 2014 (36) STR 1273 (Tri. Mumbai). * Cellular Ltd.- 2009 (16) STR 712. 6. Shri Aneesh Dewan, learned Authorized Representative for the Department, on the other hand, submits that it is incorrect to state that this Bench has not considered several alternate submissions advanced by them while passing the previous order. He submits that it is incorrect to say that the entire credit being received from the input ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... orized Representative further submits that learned Counsel has relied upon the case of Tiara Advertising (supra); however, the case is appealed against and is pending before the Hon'ble Supreme Court- 2023 (70) GSTL J59 (SC). He also relies on CCE Vs Nicholas Piramal (India) Ltd.- 2009 (244) ELT 321 (Bom.). 9. Heard both sides and perused the records of the case. The brief point that requires consideration is as to whether the appellants or M/s Panheber are manufacturers of the vaccine in question. The appellants have produced series of evidence to submit that the vaccine in question was not manufactured by the appellants and therefore, it was incorrect to invoke the provisions of Rule 6 of CCR, 2004; on going through the CESTAT Order No.A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... med "Agreement for providing manufacturing facility, utilities and services of employees". Similarly, the books of accounts of M/s Panheber Biotec Pvt. Ltd. indicates that they have taken various assets situated at Lalru, Punjab on operating lease agreements from its associate M/s Panacea Biotec Pvt. Ltd. (the appellant); these are generally non-cancellable and are renewable by mutual consent on mutually agreed terms. The books of accounts do indicate that lease amounts have been paid to the appellant. We also find that Central Drug Standard Control Organization vide their letter dated 6th June, 2007 indicated that they have permitted M/s Panheber Biotec Pvt. Ltd., Lalru, Punjab to manufacture bulk 7518/07. We find that a copy of the same h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ellants. Moreover, the affidavit dated 17.12.2012 submitted by the appellants is also on record indicating that M/s Panheber, was not the appellant, have manufactured the said vaccines. This being so, we are of the considered opinion that the claim of the appellant is not negated on sound legal reasoning. Therefore, the inevitable conclusion that follows from the discussion is that the Department having not negated the claims of the appellant that it was not the appellants who have manufactured impugned exempted product i.e the Hemophilus Flu Vaccine. Therefore, we find that no case has been made by the Department to invoke the provisions of Rule 6(3) of the CCR, 2004. 12. Coming to the alternate submission that Rule 6 provides for the sit ..... X X X X Extracts X X X X X X X X Extracts X X X X
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