TMI Blog2024 (4) TMI 1008X X X X Extracts X X X X X X X X Extracts X X X X ..... ulating the amount of CENVAT credit to be reversed under rule 6(3A) of CCR. The alternative submission of the appellant is that it can now re-assess the duty, forego the exemption notification 12/2012-CE, and claim CENVAT credit of the duty paid on its inputs - HELD THAT:- It is true, that if more than one options are available, the assessee can choose what is most beneficial to it. If it chooses wisely, it will gain and if it does not choose wisely, it will lose. In this case the appellant had made the choice while self-assessing the duty. Assessment including self-assessment is appealable before the Commissioner (Appeals) and there is nothing on record to indicate that the appellant had appealed against its assessment - the contention of the appellant cannot be accepted. In ITC LIMITED VERSUS COMMISSIONER OF CENTRAL EXCISE, KOLKATA -IV [ 2019 (9) TMI 802 - SUPREME COURT] the Constitution Bench of the Supreme Court held that all assessments, including self assessment, can be assailed before the Commissioner (Appeals). There are no provision under which the assessee can retrospectively revise its own self-assessment. Revenue neutrality - HELD THAT:- The concept of revenue neutralit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ules, 2004 read with Section 174 of CGST Act, 2017. (ii) The amount of Rs. 2,11,45,023/- (Rupees Two Crores Eleven Lacs Forty Five Thousand and Twenty Three only) reversed by the Noticee on 10.05.2017 for the period 2015-16 is ordered to be appropriated towards above amount by discharging their protest and subject to verification by the jurisdictional authority. (iii) The demand of interest at applicable rate(s) on the above short reversed amount is confirmed and ordered to be recovered from them under the provisions of Rule 6 read with Rule 14 of the Cenvat Credit Rules, 2004 read with Section 174 of CGST Act, 2017. (iv) Penalty of Rs.5,00,45,353/- (Rupees Five Crores Forty Five Thousand Three Hundred and Fifty Three only) is imposed upon them under Section 11AC of Central Excise Act, 1944 read with Rule 15 of the Cenvat Credit Rules, 2004 read with Section 174 of CGST Act, 2017. 2. The appellant is engaged in manufacturing and selling footwear and their accessories. Its corporate office in Kolkata is registered as an input service distributor [ISC]. It avails CENVAT credit on input service and distributes it to its manufacturers at Kolkata and Delhi on the basis of the aggregate ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e period from 2012-13 to 2015-16 which proposals were confirmed by the impugned order. 5. We have heard the learned counsel for the appellant and the learned authorized representative appearing for the department and perused the records. 6. Learned counsel for the appellant made the following submissions: (i) Goods cleared by availing the benefit under Sr. No. 179 of Notification No. 12/2012-CE dated 17.03.2012 do not merit to be considered as exempted goods as duty on RSP basis already stood discharged by its supplier and there was no change in the RSP. Therefore, there was no error in reversal of CENVAT credit and the appellant had procured branded footwear from registered suppliers, repacked and relabelled, but it had not increased the RSP of the footwear. Therefore, in terms of section 4A of the Act the excise duty which the appellant was liable to pay was equal to the amount which its supplier had already paid. It is a well settled proposition of law the duty cannot be charged twice on the same goods; (ii) The benefit provided under Sr. No. 179 of Notification 12/2012-CE is not really an exemption, but only a simplification of procedure, and the appellant had not gained by ado ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he benefit of notification which it had already availed by now re-assessing the goods is maintainable in the eyes of law; and (c) whether or not, extended period of limitation is invocable; (v) As far as the expression exempted goods is concerned, Rule 2(d) of CCR reads as follows: Rule 2(d) (d) exempted goods means excisable goods which are exempt from the whole of the duty of excise leviable thereon, and includes goods which are chargeable to Nil rate of duty; (vi) Evidently, any goods which are exempted from payment of the whole duty are to be considered as exempted goods under CCR. Therefore, the goods cleared under Notification No. 12/2012-CE clearly exempted goods; (vii) The test to determine whether some goods are exempted or not is to see if in the absence of the exemption notification or any other provision, the goods will be chargeable to excise duty. Undisputedly, but for the Exemption Notification No. 12/2012-CE, the branded footwear which the appellant had procured, labelled and re-labelled and packed/ re-packed were chargeable to excise duty as per section 2(f)(iii). Therefore, the appellant would have been liable to excise duty but for the exemption notification; (vi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s exempted by virtue of the notification. 9. The submissions of the learned authorized representative deserve to be accepted. Goods cannot be both dutiable and exempted at the same time depending on the convenience of the assessee. If they are chargeable to duty they are dutiable. If they exempted fully they are exempted. It also does not matter if the exemption notification was conditional or unconditional. If the notification is conditional and the appellant fulfils the conditions, it can claim the benefit of exemption notification. If it does not fulfil the conditions, it will not be entitled the benefit of the notification. Clearly, the goods cleared by the appellant were chargeable to duty but were exempted by the Notification No. 12/2012-CE (Sr. No. 179). Under these circumstances, it cannot be said that they should be treated as dutiable although the exemption notification was claimed and no duty was paid. 10. The submission of the appellant is that the RSP was the same on the footwear which it had purchased and the footwear which it had sold and, therefore, if it had paid duty it could have claimed an equal amount as CENVAT credit and, therefore, the goods should be treated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ention of the appellant cannot be accepted. 14. It has been submitted by the learned counsel for the appellant that the entire exercise is Revenue neutral and, therefore, the demand cannot be sustained. 15. Learned authorized representative, on the other hand, submits that Revenue neutrality should not make any difference to the application of law. 16. We find that revenue neutrality, per se, does not extinguish the liabilities of the assessee. The entire exercise could be revenue neutral or even revenue negative. For instance, if the assessee is entitled to CENVAT credit at the rate of 12% on the inputs and was only liable to pay excise duty at the rate of 6% of the final products, the assessee will accumulate more CENVAT credit and will pay less duty but the appellant has to pay the duty, regardless of the CENVAT credit etc., as per the provisions of the law. If there are various options to the assessee, it can be choose any option. The concept of revenue neutrality was only brought in through a series of judicial pronouncements for the limited purpose of determining if the assessee could have had an intention to evade to justify invoking extended period of limitation while raisi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r Rule 14 of the Cenvat Credit Rules 2004 along with interest at the applicable rate mentioned under Rule 6(3A)(i) of the Cenvat Credit Rule 2004. 20. The appellants contested the invocation of extended period of limitation on the ground that all facts were within the knowledge of the department and it had filing the ER-1 as required and there is no finding of any suppression of facts on its part. 21. The impugned order record the following reasons for invocation of extended period of limitation: 7.24. The Noticee willfully suppressed the material facts from the Department by not disclosing the said facts in their periodical Excise Returns in as much as that from the returns filed by the Noticee, it could not be gathered that Cenvat Credit has been availed by them in contravention of the provisions of Rule 6(3A) of the Cenvat Credit Rules, 2004. Had the Noticee not been audited, the short-payment of duty (short reversal of Cenvat Credit) would not have been revealed. Thus, it is evident that the Noticee did not disclose correct value of exempted services and goods, in the final calculations in contravention of the provisions of Rule 6(3A) of the Cenvat Credit Rules, 2004. Thus, the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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