CESTAT RULING (CENTRAL EXCISE)
2015-TIOL-1823-CESTAT-BANG
Sreepathi Pharmaceuticals Ltd Vs CC, CE & ST (Dated: May 26, 2015)
Central Excise - Reversal of Cenvat credit - Inputs supplied for manufacture destroyed
in fire at Job worker's premises before reaching final stage of goods - Rule 3(5c) is not
applicable since inputs and not the final product got destroyed - Nor remission of duty
is involved - Appellant held is entitled to Cenvat credit of duty on said inputs
destroyed in fire accident - Impugned order denying credit is set aside. (Para 4, 5, 6)
2015-TIOL-1822-CESTAT-HYD
Singhania Offset Printers Pvt Ltd Vs CC, CE & ST (Dated: February 04, 2015)
Central Excise - Waiver of Pre -deposit - Manufacture of self adhesive labels - Whether
products of printing industry attracting nil rate of duty - Held on facts that prima facie,
the stickers produced are covered by HSN chapter notes - However, since the original
adjudicating authority had taken a view in favor of the appellant and further issue
relates to classification and requires detailed consideration of Tariff description, HSN
notes etc, appellant is directed to deposit Rs.50,000 to hear the appeal - Pre -deposit
of balance due is waived. (Para 4)
2015-TIOL-1821-CESTAT-MUM
Shraddha Ispat Pvt Ltd Vs CE (Dated: June 08, 2015)
CX - CENVAT - Availment of credit of service tax paid by appellant under GTA services
during the period 24.03.2005 to 15.06.2005 under TR-6 challan - credit denied on the
ground that during the material time TR -6 challan was not prescribed as a valid
document for taking credit under rule 9 of CCR, 2004. Held - Punjab & Haryana High
Court in the case of Ralson India Ltd. and Bombay High Court vide order dated
18.02.2015 has decided the same issue in favour of assessee inasmuch as credit
availed on such TR-6 challans has been held as admissible - Therefore, order of
adjudicating authority is not sustainable and hence set aside - Appeal allowed:
CESTAT [para 5, 6]
2015-TIOL-1818-CESTAT-AHM
Dhariwal Industries Ltd Vs CCE & ST (Dated: August 13, 2015)
CE - Pan Masala (Packing Machine, Capacity Determination & Collection of Duty)
Rules, 2008 - Ban on usage of plastic pouches in packing of gutkha - appellant paying
duty for the month as per rule 9 & later closing down their factory but coming to know
that the ban is effective from 01.03.2011, hence appellant reopening factory - refund
of duty claimed in respect of the six days when factory was closed - It is Rule 16 that
applies and not rule 10 - Refund permissible on pro-rata basis - appeal allowed:
CESTAT [para 9, 10, 13, 14]
Also see analysis of the order
2015-TIOL-1815-CESTAT-MUM
M/s Sunil Industries Ltd Vs CCE (Dated: February 05, 2015)
CX - HASITPACD Rules, 1998 - Compounded levy scheme - Processed fabrics Inclusion of length of gallery and cooling zone while determining capacity of stenters
as 17 chambers - against order of Commissioner fixing capacity, appellant making
representation but no reply received - in the meanwhile demand notices issued for
recovery of differential duty - demand confirmed, hence appeal before CESTAT. Held:
Tribunal in the case of Samarth Knitters P Ltd. - 2013-TIOL-1862-CESTAT -MUM has
dealt with exactly similar issue and held that length of galleries are not be taken into
consideration while fixing capacity of stenter - assessee can challenge the demand
raised although they have not challenged the order fixing annual capacity by the
Commissioner - Order set aside and appeal allowed: CESTAT [para 3, 4]
2015-TIOL-1814-CESTAT-MUM
Smruti Organics Ltd Vs CCE (Dated: June 18, 2015)
CX - When it is not disputed that the appellant is not required to discharge any CE
duty on the goods exported by them and the revenue authorities have held that the
amount debited is without any authority of law, the natural corollary would be that the
amount is returned as Revenue can collect tax/duty only by authority of law - Order
set aside and appellant directed to take the credit back in their CENVAT account Appeal allowed: CESTAT [para 6, 8]
Also see analysis of the order
2015-TIOL-1813-CESTAT-DEL
M/s Space Telelink Ltd Vs CCE (Dated: June 29, 2015)
CX - Assessee has defaulted in making payment of Excise duty within 30 days and
thereafter they utilized Cenvat Credit account for payment of duty - Later on, the
appellant paid the duty through PLA along with interest and sought Cenvat Credit on
duty paid - Revenue views that assessee have contravened provisions of Rule 8 (3A)
of CER, 2002 - As per Indsur Global Ltd. 2014-TIOL-2115-HC -AHM-CX , as Rule 8(3A)
has been declared unconstitutional, consequently proceedings against assessee are
not sustainable - Assessee has contravened provisions of CER, 2002, therefore,
general penalty of Rs.5,000/ - under Rule 27 is imposed - Managing Director has not
contravened, penalty on Managing Director are set aside: CESTAT
2015-TIOL-1812-CESTAT-AHM
M/s Sujata Chemicals Vs CCE & ST (Dated: June 10, 2015)
CX - Assessee is sending Caustic Potash Flakes for purification to two job workers M/s.
Vinayak Chemicals and M/s. Atlas Pallet Industries - In case of job worker M/s. Atlas
Pallet Industries, 100% yield of Potash Pallets is the result whereas in case of M/s.
Vinayak Chemicals, a processing loss of 10% is claimed in yield - No Scientific
Literature or certificate from a Chartered Engineer was produced to support the ir
claim that in process of conversion of Caustic Potash Flakes into Potash Pallets there is
a loss of 10% as claimed by them - In absence of any such documentary evidence, no
reason to interfere with order passed by first appellate authority and same is required
to be upheld in so far as denial of CENVAT credit and interest is concerned: CESTAT
Penalty - As assessee was sending inputs through challans under Rule 4 (5)(a) of
CCR, 2004, it can not be said that there was any suppression/ mis -statement on part
of assessee with intent to evade payment of duty - Penalty under Rule 15 (2) of CCR,
2004, read with Section 11AC of CEA, 1944 is set-aside: CESTAT
2015-TIOL-1809-CESTAT-BANG
West Coast Paper Mills Pvt Ltd Vs CCE & ST (Dated: May 29, 2015)
Central Excise - Inputs used in the construction of chimney, a part of pollution control
system, are capital goods - Cenvat credit is admissible - Since credit availed reflected
in statutory documents and more so the issue was also a contentious and debatable
one, malafides cannot be attributed - Penalty hence set aside. (Para 3, 4)
2015-TIOL-1808-CESTAT-DEL
Young Steels Pvt Ltd Vs CCE (Dated: March 17, 2015)
CX - Appellant manufactures M.S. Ingots - One of the buyers of M.S.ingots is
M/s.Kamdhenu Ispat Ltd., (KIL) - During search of premises of M/s. KIL, certain pen
drives, CPUs and Lap Tops, ingot purchase file recovered - Out of total duty demand
of Rs. 74,06,356/-, Rs. 12.93 lakh is based on entries in purchase file recovered from
premises of M/s.KIL - There is no dispute that Shri Devender Arora, MD of appellant
company in his statement, when shown the above mentioned purchase file, admitted
that entries in purchase file pertaining to his company are true, and that the goods
had been supplied to KIL without payment of duty - Out of duty demand of Rs.12.93
lakh, appellant have already paid Rs.10 lakh - Remaining duty demand of Rs.61 lakh
is based on data retrieved from pen drives and CPU - Duty demand of Rs.44 crores
had been raised against M/s. KIL based on CPU data and Commissioner expressing
doubt about genuineness of that data has dropped the demand - Commissioner while
confirming duty demand based on data retrieved from pen drives has not gone into
question as to whether the data is genuine or is tampered with, same can be
examined in detail only at the time of final hearing - Appellant company is directed to
deposit Rs.5 lakh within four weeks: CESTAT [Para 7, 8, 9, 10]
2015-TIOL-1807-CESTAT-MUM
CCE Vs M/s Garware Wall Ropes Ltd (Dated: April 30, 2015)
CX - Refund, Interest - s.11B, 11BB of CEA, 1944 - Order of Tribunal was passed on
25.06.2007 holding that the credit of refund amount to Consumer Welfare fund is
wrong and appeal was allowed with consequential relief - Revenue contention is that
interest on refund is payable w.e.f 25.09.2007, that is after 3 months from the date of
the CESTAT order. Held: Interest is payable from the date of expiry of 3 months from
the date of receipt of application under s.11B(1) of the CEA, 1944 - Order passed by
Commissioner(A) based on the ruling of the Bombay High Court in Ballarpur
Industries - 2009-TIOL-34-HC -MUM-C X affirmed by apex court in Ranbaxy
Laboratories - 2011-TIOL-105-SC-C X does not suffer from any illegality or impropriety
- Revenue appeal dismissed: CESTAT [para 5, 6]
2015-TIOL-1806-CESTAT-MUM
Ruby Mills Ltd Vs CCE (Dated: June 18, 2015)
CX - s.35C(2A) of CEA, 1944 - Applicant seeking extension of stay on the ground that
their appeal has not come up for disposal for no fault of theirs. Held: In the case of
Venketeshwara Filaments Pvt. Ltd. - 2014-TIOL-2388-CESTAT -AHM it is held that
consequent upon omission of 1 st , 2 nd and 3 rd proviso to section 35C(2A) of the
CEA, 1944 by the FA, 2014 it is to be held that there is no provision for making
further application for extension of stay and that the stay order passed by the
Tribunal, if it is in force beyond 07.08.2014, it would continue till the disposal of the
appeals and there is no need for filing any further applications for extension of orders
granting stay either fully or partially – since the stay in the present case was in force
beyond 07.08.2014, same would continue till the disposal of the appeal - Application
disposed of: CESTAT [para 2, 3 ]
2015-TIOL-1805-CESTAT-KOL
CCE Vs M/s Texmaco Rail And Engg Ltd (Dated: November 13, 2014)
CX - Assesse are manufacturer of excisable goods and cleared without payment of
duty under 'Served from India Scheme' i.e. "SFIS" after availing benefit of exemption
Notfn 34/2006-CE - Assessee contends that benefit of said Notfn cannot be equated to
"exempted goods", and they not required to pay an amount equal to 10% of value of
goods cleared by availing benefit of said notfn - Revenue has assailed impugned order
of Commissioner on ground that he has allowed credit on duty free materials used in
manufacture of impugned goods, which were exempt from payment of duty - At the
time of passing order, case laws cited by assessee were not available to Commissioner
and therefore, he had no occasion to examine facts in light of said case laws - Both
sides agreed that these issues to be addressed afresh by adjudicating authority - Case
remanded: CESTAT
2015-TIOL-1803-CESTAT-BANG
Bharat Heavy Electricals Ltd Vs CCE, C & ST (Dated: May 29, 2015)
Central Excise - Refund claim - Limitation - Payment of duty pending disposal of the
appeal - Eligibility to claim exemption under Notification No. 108/95-CE - Lodging of
explicit claim of protest must precede payment of such duty - Neither the duty paid by
manufacturer during the pendency of appeal for the disputed period was under protest
- Nor was the CESTAT order relied on covers the entire period in question - Refund
claim filed beyond prescribed period of limitation unde r section 11-B is hit by
limitation as such was rightly rejected - Contention of appellant that as the issue was
before the Tribunal by way of an appeal, the duty paid during the subsequent period
must be deemed to be having been paid under protest held cannot be appreciated
because statute provided a specific procedure to be followed which was not complied Question of deemed fiction thus does not arise - No infirmity in the impugned orders Assessee appeal has no merit hence is rejected. (Para 7)
2015-TIOL-1802-CESTAT-MAD
CCE Vs M/s Dharani Sugars And Chemicals Ltd (Dated: April 16, 2015)
Central Excise - CENVAT credit - precise question raised by Revenue is whether the
duty paid on the molasses generated by sugar plant of appellant and such molasses
utilised for the purpose of manufacture of de -natured spirit, rectified spirit and extra
neutral alcohol, shall allow the appellant to transfer the credit of the duty so paid on
molasses for set off against the duty liability against the sugar cleared from the
factory.
Held: The Chennai High Court in the Rajshree Sugars and Chemicals case, on similar
facts, ruled that the transfer of credit between distillery and sugar units was
permissible; same applicable to the instant case. [Para 2]
2015-TIOL-1801-CESTAT-MUM
Videocon Industries Ltd Vs CCE (Dated: July 31, 2015)
CX - S.4A of CEA, 1944 - Valuation - While arriving at the assessable value for the
retail sale price, an amount of abatement specified by notification can only be
deducted - there is no provision under the law to exclude warranty charges from the
RSP - statutory provision under Section 4A cannot be altered or influenced merely
because the appellant has chosen to discharge service tax on portion of the retail sale
price - Demand upheld and appeal dismissed: CESTAT [para 6]
Also see analysis of the order
2015-TIOL-1800-CESTAT-MUM
M/s Balkrishna Industries Ltd Vs CCE (Dated: June 17, 2015)
CX - Appellant selling six year old used forklift on discharge of CE duty at depreciated
value - after department raised objection that appellant should have paid an amount
equal to credit taken, appellant paying differential duty along with interest under
protest - later refund claimed of amount paid which was rejected. Held: Machine (fork
lift) cleared after putting into use cannot be treated as cleared 'as such' - insertion of
proviso in rule 3(5) of CCR, 2004 w.e.f 13.11.2007 makes it clear that there is a
difference between machine cleared without putting into use and cleared after use - in
view of authoritative judicial pronouncement in case of Raghav Alloys Ltd. - 2010TIOL-881-HC-P&H-CX , order rejecting refund set aside and appeal allowed with
consequential relief: CESTAT [para 4, 5]
2015-TIOL-1799-CESTAT-MUM
M/s Asiatic Gases Ltd Vs CCE (Dated: May 8, 2015)
CX - Interest - Whether appellant is required to pay interest in a case where duty
along with part interest was paid voluntarily - appellant submitted that inte rest on
delayed payment of duty cannot be demanded unless duty is determined under
s.11A(2) of CEA, 1944. Held: It is an admitted fact that there is substantial delay in
payment of duty even though appellant has paid interest voluntarily - even though the
duty was not determined u/s 11A(2) of CEA, 1944 but when there is admitted delay in
payment of duty, interest is chargeable even prior to 11.05.2001 - in view of apex
court decision in International Auto Ltd. 2010-TIOL-05-SC -CX interest is levied for
loss of Revenue on any count - no infirmity in the order, hence sustained - appeal
dismissed: CESTAT [para 5]
2015-TIOL-1798-CESTAT-DEL
M/s Ambassador Coolers Pvt Ltd Vs CCE (Dated: February 3, 2015)
CX - Assessee has placed purchase order to supply all goods to M/s. Nowrangroy
Rameshwar with directions that goods are required to be delivered at job worker's
place - Invoices were raised in name of assessee and goods were delivered to job
worker, which were received by assessee after processing - Rates quoted are of job
work charges only, although the job worker has paid VAT thereon - It cannot be
concluded that goods have been sold by job worker to assessee - When assessee has
filed reply to SCN, facts were required to be verified which Revenue has failed to do so
- Under notfn 214/86, job worker is required to intimate the department that they are
undertaking activity of job worker and not required to pay duty but that fact has also
been not verified by department - Assessee is entitled to take Cenvat credit - Appeal
allowed: CESTAT
2015-TIOL-1797-CESTAT-DEL
M/s Pepsico India Holdings (P) Ltd Vs CCE (Dated: April 16, 2015)
CX - Assessee are manufacturers of Aerated Water, one of the inputs is glass bottles
in respect of which input duty CENVAT Credit has been taken - Some glass bottles,
during use get broken and same are cleared as glass scrap - During period of dispute
there was no provision in CCR, 2001/2002 providing that when CENVAT Credit availed
inputs are cleared as waste, some amount in respect of same is required to be paid Impugned order set aside and appeal allowed: CESTAT
2015-TIOL-1796-CESTAT-BANG
M/s Hetero Labs Ltd Vs CCE (Dated: May 1, 2015)
Central Excise - Bulk drug manufacture - Procurement of duty free imported and
indigenous raw material - Cenvat credit utilization -Whether or not credit availed on
duty paid inputs can be used for discharge of duty at the time clearance of the duty
free imported inputs - Held in matters of CENVAT credit, there is no one-to-one
correlation and where appellants have used such credit for payment of duty for
clearance of imported raw materials, they would not be in a position to use the same
at the time of clearance of the final product-Treating reversal as proper, pre -deposit
dispensed with - Matter remanded to the Commissioner (A) for a decision on merits.
(Para 4)
2015-TIOL-1792-CESTAT-AHM
M/s Shah Paper Mills Ltd Vs CCE & ST (Dated: June 22, 2015)
CX - Assessee is manufacturer of kraft paper from waste paper - Whether main
assessee was eligible to take credit on basis of cenvatable documents showing
payment of duty - Assessee taking cenvat credit is not required to go beyond
cenvatable document to know as to how it has arisen - What input recipient is
required to verify is that supplier of raw material is genuine and proper duty is paid Both the conditions are fulfilled - Duty paid on waste kraft paper was accepted by
officer Incharge of supplier unit M/s SPPML - On merit assessee was eligible to take
CENVAT credit - No evidence brought on record that main assessee and its Director
were aware that inputs received was as a result of an activity not amounting to
manufacture - Demand issued is clearly time barred as extended period is not
imposable and no penalties can be imposed upon assessee: CESTAT
2015-TIOL-1791-CESTAT-DEL
M/s Surya Roshni Ltd Vs CCE (Dated: July 6, 2015)
CX - Refund - Assessee is manufacturer of electric bulbs and are procuring inputs and
capital goods and also availing Cenvat Credit thereon - They opted to avail exemption
under notfn 50/2003-CE i.e. area based exemption - At the time when assessee took
Cenvat Credit on inputs/capital goods, their final product was dutiable and later on
they opted for availing exemption under said notfn - As per Apco Pharma Ltd. 2011TIOL-913-HC-UKHAND-CX , they are not required to reverse Cenvat Credit on input /
inputs contained in work-in-progress / finished goods lying in their facto ry: CESTAT
2015-TIOL-1790-CESTAT-MUM
Gimatex Indst Pvt Ltd Vs CCE (Dated: June 18, 2015)
C X- Utilisation of CENVAT credit during April 2005 to March 2007 for discharge of ST
liability on outward transportation by engaging goods transport operators - lower
authorities denying such utilisation. Held: Both the lower authorities have misread the
provisions inasmuch as rule 2(r) of CCR, 2004 specifically provides that a person liable
for paying Service Tax is to be construed as a provider of taxable service - when the
provisions of rule 2(r) and rule 3(4) are read holistically, it would seem that CENVAT
credit can be utilized for discharge of ST liability during the material period and the
same need not be paid only in cash - this view is fortified by decision in Nahar
Industrial Enterprises Ltd - 2007-TIOL-555-CESTAT -DEL - Revenue, aggrieved by this
decision, had preferred an appeal and the same was dismissed by the Punjab &
Haryana High Court - order set aside and appeal allowed with consequential relief:
CESTAT [para 5, 6, 8]
2015-TIOL-1789-CESTAT-MUM
Murli Industries Ltd Vs CCE (Dated: June 12, 2015)
CX - Appellant manufacturing kraft paper and clearing the same on payment of duty case of Revenue is that goods are exempt by notification 4/2006-CE as amended and
hence appellant cannot pay duty and claim credit on inputs - Demand issued for
recovery of cred it availed and to consider duty paid/collected as u/s 11D of CEA, 1944
. Held: Issue involved is already decided by Tribunal in case of Balkrishna Paper Mills
Ltd. & Others - 2015-TIOL-1100-CESTAT-MUM by holding that appellant cannot be
forced to avail Nil rate of duty as they have option to pay duty under sr. no. 91 & 93
of the notification - appeals are allowed: CESTAT [para 3, 4]
2015-TIOL-1784-CESTAT-MUM
Value Industries Ltd Vs CCE (Dated: February 18, 2015)
C X- Whether the activity of repair carried out on returned defective compressors falls
under "repair" as provided u/r 173H of CER, 1944 or ‘manufacture' u/s 2(f) of the
CEA, 1944 - Activity is repair as no new commodity emerges - CE duty demands set
aside and appeal allowed: CESTAT [para 5]
2015-TIOL-1783-CESTAT-MUM
M/s Varroc Engineering Pvt Ltd Vs CCE (Dated: September 14, 2014)
CX - Appellant availing CENVAT credit of tax in respect of services provided by
Prakash Air Freight Pvt. Ltd. – department of the view that appellant had wrongly paid
ST on service which were exempted from payment of ST vide notification 29/2005-ST
in relation to transport of goods by aircraft operator and subsequently availed credit –
appellant submitting that bills issued by service providers shows the same as 'courier
service' - credit denied and in de novo proceedings Assistant Commissioner concluding
that 'courier service' provided by service provider was not covered under definition of
'input service' – Commissioner(A) holding that services are post clearance export
activities not connected with manufacture of goods, hence credit not admissible. Held:
As delivery charges are included in selling price, in view of Karnataka HC decision in
ABB Ltd. - 2011-TIOL-395-HC-KAR-ST , the expression 'activities relating to business'
admittedly covers transportation up to the customers place and, therefore, credit
cannot be denied – as it is an integral part of business of manufacturer to transport
and deliver the goods manufactured, appellant entitled to take credit – Appeal allowed
with consequential benefits: C ESTAT [para 7]
2015-TIOL-1782-CESTAT-DEL
M/s Timex Watches Ltd Vs CCE (Dated: May 27, 2015)
CX - Whether inputs on which assessee have taken modvat credit have been put to
use for manufacture of watches - As per Report of Defective Work, assessee initially
availed modvat credit on inputs/parts of watches, at time of receipt of same before
putting to use, assessee has conducted certain tests to find out whether inputs to be
usable or not - Inputs which did not find fit to be used, assessee has reversed credit
thereon, rest of inputs were issued by assessee for processing or assembling of
watches - Defective goods were found only after inputs were issued for processing or
assembling of watches, assessee is entitled to credit as per Rule 57D of erstwhile
Central Excise Rules, 1944: CESTAT
CX - Shortage of inputs - Assessee have explained general ledger of stock adjustment
account reflected inputs have been short accounted in some cases and in some other
cases inputs are in excess, therefore, there is no actual shortage of inputs - Shortages
and excesses are due to the fact that stock accounting used to be done on weighment
basis since minute inputs ran into millions and physical counting is not possible There is no shortage of inputs as explained by assessee - All shortages/rejections
have been supported by chartered accountant certifying the same which has not been
controverted by Revenue with cogent evidence - Assessee are not required to reverse
modvat credit taken by them - Penalty is not imposable on assessee: CESTAT
2015-TIOL-1781-CESTAT-BANG
VST Industries Ltd Vs CCE, C & ST (Dated: March 27, 2015)
Central Excise - Capital goods - Scope - Inputs (insect controlling traps) used for
managing/controlling the tobacco beetle infestation - Held, have to be considered as
eligible cenvattable inputs having been used in relation to manufacture of final
products - Credit availed clearly reflected in the records - Question of m alafide
intention does not arise - Stereotype reasoning given in all the cases of adjudication
orders by Revenue to invoke extended period of limitation, deprecated- Impugned
order of duty demand, penalty and confiscation of goods, set aside.(Para 4, 5, 6)
2015-TIOL-1780-CESTAT-MUM
M/s Rajuri Steels Pvt Ltd Vs CCE & C (Dated: May 13, 2015)
CX - Appellant was working under the compounded levy scheme u/s 3A of CEA, 1944
- since appellant did not discharge CE duty liability as fixed u/r 96ZP(3) of CER,
therefore, SCN issued and duty confirmed which appellant paid without contesting the
order-in-original - subsequently, another SCN was issued demanding interest and
equal amount of penalty u/r 96ZP(3) and which was confirmed - appellant before
CESTAT. Held: No discretion is provided to any authority to either reduce or waive
penalty and interest in any circumstances - when there is admitted delay in payment
of duty under compounded levy scheme, interest and penalty provided under the
proviso to the rule shall unavoidably be imposed - Penalty and interest rightly
imposed by adjudicating authority and upheld by Commissioner(A) which do not
require any interfe rence - Order upheld and appeal dismissed: CESTAT [para 5]
2015-TIOL-1777-CESTAT-MUM
M/s Castrol India Ltd Vs CCE (Dated: June 15, 2015)
C X- CENVAT - Rule 2(l) of CCR, 2004 - Outdoor Catering Service - Eligibility - in view
of LB decision in GTC Industries Ltd. - 2008-TIOL-1634-CESTAT-MUM-LB & appellants
own case - 2010-TIOL-733-CESTAT -AHM , credit is admissible - howe ver, since
appellant have collected 3% of the total catering charges from their employees,
CENVAT credit is not permissible on the attributable amount - as copies of input
services invoices have been submitted by appellant from time to time along with
monthly returns, extended period of limitation is not applicable - demand hit by time
bar, demand beyond one year of SCN is dropped - interest payable on the quantified
amount - penalty waived: CESTAT [para 5]
2015-TIOL-1776-CESTAT-MUM
M/s Ismt Ltd Vs CCE (Dated: May 7, 2015)
CX - During the course of manufacture of Alloys and Non -alloy cast and rolls, slag
arises which is waste material and which is cleared without payment of duty Revenue demanding amount of 10% of value of slag by invoking rule 6(3)(i) and (ii)
of the CCR, 2004. Held: In terms of para 3.7 of Chapter 5 of the CBEC's Excise Manual
of Supplementary Instructions, 2005, CENVAT credit is admissible even in respect of
input contained in any waste, refuse or by-product, therefore, demand under rule 6(3)
is not maintainable - Supreme Court in case of Hindustan Zinc Ltd. - 2014-TIOL-55SC-CX has held that demand under rule 6(3)(i) is not sustainable in respect of any
waste, by product, refuse cleared without payment of duty - in view of settled legal
position, Order se t aside and appeal allowed: CESTAT [para 5]
2015-TIOL-1775-CESTAT-MUM
CCE Vs Ispat Industries Ltd (Dated: June 29, 2015)
CX - Valuation - s.4 of C EA, 1944 - Whether cost of transportation from factory to
depot will be includible in the value of goods during the period April 2002 to March
2003 - Commissioner (A) allowed appeal keeping in view Tribunal's order dated
01.12.2003 wherein it was held that respondent is not responsible to pay the cost of
transport from the place of removal to the place of delivery i.e. from the factory gate
to the depot separately & in terms of Rule 5 of the Valuation Rules, 2000, such a cost
of transport which is also sepa rately shown is not includable in the valuation for the
purpose of excise duty - Revenue in appeal. Held: Tribunal's order has been upheld by
the Supreme Court vide order dated 25.03.2015 - 2015-TIOL-40-SC-CX - in view of
the said decision, Revenue appeal dismissed: CESTAT [para 3]
2015-TIOL-1774-CESTAT-MUM
SEW Infrastructure Ltd Vs CCE & C (Dated: June 8, 2015)
CX - Penalty imposed of Rs.2.94 crores on appellant under rule 25 of CER, 2002 Appellant submits that Tribunal has vide Final order dated 06.03.2014 allowed the
appeal of the main noticee against whom a demand of Rs.2.94 crores was made and
equal amount of penalty was imposed; that since the demand itself has not been
sustained, no penalty can be imposed on co -noticee. Held: Since duty demand on
main appellant has been set aside, penalty on the present appellant cannot survive penalty set aside - appeal as well as stay petition are allowed: CESTAT [para 6]
2015-TIOL-1773-CESTAT-ALL
CCE Vs M/s Railway Equipment And Engg Works (Dated: June 10, 2015)
CX - Classification - Whether Cast Iron Plates for Emery machinery manufactured by
assessee will be classified under CH 7325.10 of CETA, 1985 or under heading 8437.00
- Commissioner (A), while holding classification of goods under 8437.00, has relied
upon one report from Superintendent of Central Excise, Range Mathura - From report
reproduced in order of First Appellate Authority, it is correctly held that goods were
classifiable under heading 8437 - If manufacturing unit is lying closed at moment then
case of Revenue cannot be decided in their favour because it is responsibility of
Department to establish, with documentary evidence, that claim made by
manufacturing unit is not acceptable or that other finishing activities were required to
be done on cast iron plates for emery machinery - Appeal dismissed: CESTAT
2015-TIOL-1772-CESTAT-DEL
Bhushan Steel Ltd Vs CCE (Dated: May 7, 2015)
CENVAT - Since pipes are sold on basis of length, end cuttings which are not saleable
are sent under cover of duty paid invoices by registered depots to Sahibabad unit for
manufacture of ingots - credit is availed on the duty suffered on value varying from
Rs.36/- to Rs.42/- per kg - Contention of department is that as invoices issued of end
cuttings mention value as Rs.15/ - per kg, credit is to be restricted only to the duty
payable on said value - Demand of Rs.1.20 crores confirmed. Held: Stand of the
Department is not correct in view of the Apex court's judgment in the case of
Commissioner of Central Excise & Customs vs. MDS Switchgear Ltd. - 2008-TIOL-245SC-CX , wherein it has been held that the receiver manufacturer who had received the
duty paid inputs from a supplier-manufacturer is entitled to Cenvat credit of the duty
paid by the supplier manufacturer and the CEx Authorities having jurisdiction over the
recipient manufacturer cannot review the assessment of the duty at the end of the
supplier manufacturer - Demand of Credit is without any basis - CENVAT Credit of
duty paid on Welding Electrodes as well as CI Slog Pot is also admissible - Appeal
allowed: CESTAT [para 9, 10, 11]
Also see analysis of the order
2015-TIOL-1768-CESTAT-MUM
Purab Printers Vs CCE (Dated: May 18, 2015)
CX - Clause 4(e) of Notfn. 8/2003 -CE - Appellant manufacturing and supplying self
adhesive labels - Benefit of SSI sought to be denied on the ground that they are
branded goods and not covered by clause 4(e). Held: Intention of government is to
grant the benefit of SSI exemption to goods, namely, packing material, containers,
metal labels etc. which may carry brand name of customers - stated policy is clearly
not to consider these labels manufactured by one person themselves as having any
connection in the course of trade with the goods manufactured by customer for whom
labels are made - Oxford dictionary describes a sticker as "an adhesive label or notice"
- no reason not to consider a label as sticker especially in view of the fact that metal
labels are also mentioned in clause 4(e) - an interpretation to the effect that stickers
would mean only gummed labels is not borne by sound reasoning - labels are eligible
for exemption in terms of notification 8/2003-CE as amended by 47/2007 -CE - order
set aside and appeal allowed: CESTAT [para 5.1, 5.2]
2015-TIOL-1764-CESTAT-MUM
M/s Aplab Ltd Vs CCE (Dated: May 15, 2015)
CX - CENVAT credit denied on the ground that name of appellant appears as
consignee but in the column of buyer, name of dealers are mentioned. Held: Revenue
contention is absurd - For taking CENVAT credit on input it is not mandatory that
payment towards purchase of the input has to be made - so long as input is duty paid,
received in the factory and used in the manufacture, credit is not deniable - appeals
allowed: CESTAT [para 5]
2015-TIOL-1763-CESTAT-DEL
AMD Metplast Pvt Ltd Vs CCE & ST (Dated: March 18, 2015)
CX - Assessee supplied printed sheet to their sister unit charging excise duty at the
rate of 16% ad valorem instead of 8% ad valorem - Credit note was issued to sister
unit reverse the credit taken by them and also filed refund claim of excess duty paid
by them - Assessee submits that sister unit to whom goods were transferred have
reversed excess duty, therefore, bar of unjust enrichment has been passed by
assessee - As per Ispat Industries Ltd. - 2014-TIOL-2053-CESTAT -MUM, assessee is
entitled for refund claim - Appeal allowed: CESTAT
2015-TIOL-1761-CESTAT-MAD
M/s Acer India Pvt Ltd Vs CCE & ST (Dated: June 3, 2015)
Central Excise - Condonation of delay - Appellant cleared excise duty paid goods to
SEZ and claimed refund under Rule 5 of Cenvat Credit Rules 2004, which was granted
in adjudication and agitated by Revenue before Commissioner (Appeals), who held the
claim time barred, allowed the departmental appeal, and permitted re -credit of the
amount debited in CENVAT Account upon which, theAppellant repaid the amount
refunded - Meanwhile, proceedings were initiated for recovery of interest on the
erroneous refund, culminating in the instant appeal contesting the merit of the original
refund itself, with COD application for delay of 433 days, taken up for disposal herein.
Held: The OIA was passed on 04.10.14 and in the said order while allowing the
Revenue appeal Commissioner (Appeals) allowed re-credit - The department again
issued show cause notice for demand of interest on the refund sanctioned, which was
already paid by the appellant in pursuant to the OIA - the reasons of delay is fully
justified and beyond their control due to initiation of another round of proceedings
against the appellants - following theSupreme Court decision in the case of Collector,
Land Acquisition Anantnag and Another Vs. MST. Katiji and Others; and the Tribunal
ruling in the case of ARR Enterprise Vs. CCE, Trichy, the delay in filing the appeal is
condoned [Para 3]
2015-TIOL-1760-CESTAT-MAD
CCE Vs Dynavista Industries Pvt Ltd (Dated: March 17, 2015)
Central Excise - CENVAT credit - respondents are manufacturer of Kite Detergent
Powder, and discharged duty under Section 4A of the Central Excise Act 1944 - While
clearing the goods, they also cleared in combi-pack containing free offer of detergent
soap along with washing powder - credit attributable to the detergent soa p which was
supplied free along with detergent powder denied in adjudication; and demand for its
recovery with interest and penalty confirmed - demands set aside by Commissioner
(Appeals) and agitated by Revenue herein.
Held: Revenue's only ground is that free supply of detergent soap which was packed
inside the detergent powder and therefore respondents are not eligible to avail cenvat
credit on the duty paid on the detergent soap as it is not an input - Revenue has not
disputed the fact that respondent has discharged central excise duty on the detergent
powder under Section 4A - respondents had packed free supply of one detergent soap
inside the washing powder of 500 gms. and correctly declared the net weight of the
combi-pack of 575 gms. and discharged duty on the detergent powder - respondents
are rightly covered under Section 2(f) (3) of Central Excise Act - The lower authority
has rightly relied on decision of the Tribunal in the case of Lotte India Corporation
which was considered by the Gujarat High Court in its ruling pronounced in the case of
Prime Healthcare Products - Revenue's reliance on Perfetti Van Melle ruling misplaced
since it pertained to the period prior to amendment of Sec 2(f) while the material
period in the instant case is after the amendment and the Gujarat HC ruling applies no infirmity in the impugned order which is upheld[Para 5]
2015-TIOL-1759-CESTAT-DEL
M/s Triveni Engineering And Industries Ltd Vs CCE & ST (Dated: June 25,
2015)
CX - Assessee is manufacturer of sugar and availed Cenvat Credit of ST paid on
transit insurance in respect of insurance of goods during transit from factory to
customers premises - Sale of sugar by assessee was on FOR destination basis - As per
sale contract sugar was required to be delivered at customers destination - Insurance
expenses have been paid by assessee for transportation of goods upto the place of
buyer and same has been reimbursed by buyer of goods - As per Suzuki Motorcycle
(I) Pvt. Ltd. 2013-TIOL-1974-CESTAT-DEL assessee is e ntitled to take cenvat
credit of insurance premium charges paid by them when there is no dispute that
goods were delivered at customers place - Appeal is allowed: CESTAT
2015-TIOL-1758-CESTAT-MAD
M/s Ttk Prestige Ltd Vs CCE (Dated: May 27, 2015)
Central Excise - CENVAT credit - The issue involved is whether the service tax credit
of one unit of the ISD distributed by it to the appellant makes the appellant eligible to
it.
Held: Tribunal, in Final Order No.404412/2015, dated 08.04.2015 in the India
Cements case held that it is not necessary that the credit earned by one Unit need be
consumed by that Unit only, but can be transferred to the other Unit by ISD for
consumption - In absence of any dispute as to the earning of the credit distribution
thereof is not deniable [Para 4, 5]
2015-TIOL-1757-CESTAT-MUM
M/s Ultra Tech Cement Ltd Vs CCE (Dated: June 10, 2015)
CX - CENVAT - Rule 2(l) of CCR, 2004 - Services received and used in residential
colony of appellants employees, whether Input Service - Issue no longer res integra Bombay High Court in case of - 2010-TIOL-720-HC -MUM-ST has held that services
which are rendered at the residential colony of the employees cannot be availed as
CENVAT credit - Credit correctly held to be inadmissible - as for penalty, in appellants
own case, Tribunal on an identical issue relying on the Andhra Pradesh High Court
decision in ITC Ltd. - 2012-TIOL-199-HC-AP -ST has vide its order dated 15.04.2013
set aside the penalties - no reason to deviate from such view already taken - appeal
partly allowed: CESTAT [para 4, 4.1]
2015-TIOL-1756-CESTAT-MUM
Indian Petrochemicals Corporation Ltd Vs CCE (Dated: June 22, 2015)
CX - Applicant seeking extension of stay on the ground that their appeal has not come
up for disposal for no fault of theirs. Held: In the case of Venketeshwara Filaments
Pvt. Ltd. - 2014-TIOL-2388-CESTAT-AHM it is held that consequent upon omission of
1 st , 2 nd and 3 rd proviso to section 35C(2A) of the CEA, 1944 by the FA, 2014 it is
to be held that there is no provision for making further application for extension of
stay and that the stay order passed by the Tribunal, if it is in force beyond
07.08.2014, it would continue till the disposal of the appeals and there is no need for
filing any further applications for extension of orders granting stay either fully or
partially – since the stay in the present case was in force beyond 07.08.2014, same
would continue till the disposal of the appeal - Applications disposed of: CESTAT [para
2, 3]
2015-TIOL-1755-CESTAT-AHM
CCE & ST Vs M/s Rajesh Malleables Ltd (Dated: January 8, 2015)
Central Excise - Default in payment of duty - Bar of utilization of CENVAT Credit under
Rule 8(3A) - No error in the order of Commissioner (Appeals) allowing the appeal in
the light of decision by the High Court of Ahmedabad holding Rule 8(3A)
unconstitutional - Revenue appeal has no merit. (Para 3&4)
2015-TIOL-1748-CESTAT-DEL
M/s Onida Saka Ltd Vs CCE (Dated: June 3, 2015)
CX - s.4 of CEA, 1944 - Valuation - Period of dispute is June, 1994 to August, 1996 A manufacturer can always decide to sell his entire production to another person
instead of marketing the same himself and incurring expenses on marketing and
advertisement himself and for this reason, the manufacturer and his customer cannot
be treated as related person - Allegation of undervalution not sustainable - demand
set aside - appeals allowed: CESTAT [para 11, 13]
Also see analysis of the order
2015-TIOL-1747-CESTAT-AHM
M/s Gujarat State Fertilizers And Chemicals Ltd Vs CCE & ST (Dated: June 12,
2015)
CENVAT - Activities undertaken by the distributors/ consignment stockists of the
appellant are purely distribution/ sales and have no element of sales promotion and,
therefore, CENVAT credit taken with respect to commission paid to such distributors/
consignment stockists is not admissible - Credit taken to be reversed along with
interest, however penalty set aside as the issue was disputable at the material time:
CESTAT [para 6, 7, 8]
Also see analysis of the order
2015-TIOL-1746-CESTAT-AHM
M/s Aditya Laminators Pvt Ltd Vs CCE, C & ST (Dated: April 17, 2015)
CENVAT - Allegation that the appellant had availed cenvat credit on the basis of
invoices issued by the non -existent allegedly registered manufacturers/dealers Range Superintendent of the appellant company had defaced some of the invoices and
allowed Modvat Credit at the initial stage as required under the law - it is evident that
the appellant had no knowledge that the input suppliers were not registered with the
Central Excise Authorities - appellant during the investigation, categorically stated
that they received the goods accompanied with Central Excise invoice and duty
recorded in Cenvat Register - It is further evident from record that inputs were
utilized in the finished goods, cleared on payment of duty - There is no material
available that the appellant was party to the fraud - demand hit by limitation appeals allowed: CESTAT [para 8, 9, 12]
2015-TIOL-1744-CESTAT-AHM
Sarla Performance Fibers Ltd Vs CCE, C & ST (Dated: February 24, 2015)
CX - Assessee, 100% EOU received duty free imported and indigenous raw materials
for use in manufacture of exported goods - Assessee discharged CE duty on goods
cleared to the local market, an amount equal to customs duty and therefore, separate
demand of custom duty on raw materials would not sustain - Tribunal consistently,
viewed in a series of decisions that in case of 100% EOU, CE duty paid on finished
goods, demand of custom duty on raw material and pe nalty under Custom Act cannot
be sustained - Central Excise Officers detained seized goods, which was attempted to
divert in local market - Confiscation of goods is justified and accordingly imposition of
redemption fine is warranted - Impugned order is modified in so far as demand of CE
duty of Rs. 1,65,007/ - and customs duties of Rs. 10,05,353,59/- on raw materials are
set aside: CESTAT
2015-TIOL-1743-CESTAT-DEL
Decora Tubes Ltd Vs CCE & ST (Dated: May 5, 2015)
CX -Penalty -Rule 26 of CER -Even if the Commissioner could not adjudicate the
question of duty demand against the company in view of the liquidation order of the
High Court, in our view, the Commissioner could always adjudicate the question of
imposition of penalty on the co -noticees: CESTAT [para 7]
Also see analysis of the order
2015-TIOL-1739-CESTAT-MUM
M/s Zydus Atlanta Healthcare Pvt Ltd Vs CCE (Dated: June 10, 2015)
C X- Rule 5 of CCR - Refund - Catering services, travel and car services are entitled for
CENVAT credit as input service, therefore, refund admissible - there is no reason for
deviating from such view already taken in respect of the very same assessee and
reported as - 2013-TIOL-537-CESTAT-MUM - Assessee appeal allowed: CESTAT [para
5, 6]
C X- Rule 5 of CCR - Refund - Appeal by Revenue on the ground that service tax paid
on clearing and forwarding agent services are utilised post clearance of the final
products from factory and that the ownership of the goods still vested in the
assessees hand and that the place of removal cannot be the port where services are
received - this argument will not carry the case of the revenue further as the LB of
Tribunal in the case of Honest Biobet Pvt. Ltd. - 2014-TIOL-2286-CESTAT -AHM-LB has
held that load port is to be considered as place of removal u/s 4(3)(c)(iii) of CEA,
1944 - services received by assessee at the port of export of goods has to be held as
eligible for CENVAT credit under the CCR, 2004 - Revenue appeal is devoid of merits:
CESTAT [para 7, 8]
2015-TIOL-1738-CESTAT-MUM
M/s Tata Motors Ltd Vs CCE (Dated: October 24, 2014)
CX - CENVAT - Appellant painted body shells received from Fiat India Automobiles P
Ltd. on job work basis under rule 4(5)(a) of CCR, 2004 - after painting, body shells
were returned to the principal manufacturer under job work challans without payment
of CE duty - finished goods were cleared by FIAT on payment of duty - appellant had
availed CENVAT credit of duty paid on inputs such as paints, thinners etc. used in job
work - Credit in excess of Rs.38 lakhs denied on ground that appellant is not entitled
for credit on inputs used for job worked goods which were cleared without payment of
duty; penalties and interest imposed. Held : Issue is no longer res integra as the
same has been decided in favour of assessee by LB of Tribunal in case of Sterlite
Industries - 2005-TIOL-305-CESTAT -MUM-LB - appellant is entitled to avail credit Orders set aside and appeal allowed with consequential relief: CESTAT [para 5]
2015-TIOL-1737-CESTAT-MAD
Tvs Electronics Vs CCE (Dated: March 18, 2015)
Central Excise - CENVAT credit - appellants are manufacturers of Retail Computer
Systems, DOT Matrix Printers - they availed credit on inputs used in the manufacture
of Retail Computer system when the same were chargeable to excise duty Subsequently, the computers were exempted from excise duty vide Notification
No.23/2004-CE dt. 9.7.2004 - However, on the date of exemption, appellant had
certain inputs lying in stock on which the credit was taken much before the date of
exemption - Demand for recovery of corresponding credit adjudicated with interest
and penalty; relief from penalty granted by first appellate authority; and primary
demands agitated herein.
Held: During the material period there is no specific provision in CCR for recovery of
cenvat credit on the inputs lying in stock when the final product became exempted
subsequently - from 1.3.2007 sub-rule (3) of Rule 11 of CCR was inserted making
specific provision where a manufacture is required to pay amount equal to the cenvat
credit taken on inputs lying in stock if the final product became fully exempted - High
Court of Madras in the case of Tractor and Farm Equipment Ltd. Vs CCE on identical
issue examined the case in detail and distinguished the decisions of both M/s.Albert
David Ltd. and M/s.Super Cassettes Industries Ltd. and held in favour of the appellant
- Cited TAFE ruling is binding on the Tribunal in terms of the Larger Bench decisions in
the case of CCE Vs Kashmir Conductors and in the case of Madura Coats Vs CCE impugned order set aside. [Para 8, 9, 10]
2015-TIOL-1736-CESTAT-DEL
Prakash Cable Industries Vs CCE (Dated: February 5, 2015)
CX - In facory premises of assessee there was some shortage of finished goods and
some goods were found in excess - Assessee has admitted their duty liability and
same has been paid alongwith interest and also paid 25% duty as penalty under
section 11AC of CEA, 1944 within 30 days of issue of SCN - Impugned order was not
required to be passed and proceedings against assessee would be concluded Confiscation of goods and consequently imposition of redemption fine, penalties are
not warranted - Appeals allowed: CESTAT
2015-TIOL-1735-CESTAT-DEL
CCE & ST Vs M/s Park Nonwoven Pvt Ltd (Dated: April 8, 2015)
CX - Fire broke out in factory of assessee wherein the inputs which were used in
manufacture were destroyed - It is admitted fact that inputs were in process of
manufacture of final goods - Therefore, the provisions of Rule 3(5B) of CCR, 2004 are
not applicable - Assessee are not required to reverse Cenvat credit - As such no
infirmity in impugned order, same is upheld - Appeal filed by Revenue is dismissed:
CESTAT [Para 9, 10, 12]
2015-TIOL-1732-CESTAT-MAD
M/s Celebrity Fashions Ltd Vs CCE (Dated: May 29, 2015)
Central Excise - Refund - Claim for Rs.42 lakh under Rule 5 of Cenvat Credit Rules
2004 rejected by original authority - Commissioner (Appeals) held Rs.33 lakh
admissible subject to verification by original authority and Rs.9 lakh inadmissible Tribunal remanded the disputed 9 lakh to original authority - Meanwhile original
authority passed de novo order in respect of Rs.33 lakh, granting refund to the extent
of Rs.28 lakh and denying to the extent of Rs.5 lakh; same agitated by Revenue
before Commissioner (Appeals) who allowed the departmental appeal, now agitated
herein.
Held: It is ordered that the matter shall go back to Commissioner (Appeals) who shall
within a month of making the application by assessee fix the time of hearing and
expose the range report to assessee for rebuttal; consider entire facts evidence and
law, and pass appropriate order [Para 5]
2015-TIOL-1731-CESTAT-MUM
Salsar Ispat Ltd Vs CCE (Dated: May 30, 2015)
CX - Penalty - Rule 26 of CER, 2002 - Penalty imposed of Rs.50,000/ - each in the
three appeals - Allegation is that the appellant had purchased clandestinely cleared
MS Ingots and MS bars from various manufacturers and which fact appellant has
admitted - in two of the cases, the suppliers have paid the duty, interest and 25%
penalty within 30 days as per section 11A(1A) of CEA, 1944 and in third case part
payment was made - appellant seeking setting aside of penalty. Held: Matter is
covered by Tribunal's decision in the case of Jay Prakash Agarwal wherein it is held
that once the manufacturers have paid duty, interest and 25% penalty, there would
be no sense in continuing the proceedings for imposition of penalty under Rule 26
against other persons like traders who had purchased the goods, transporters who
had transported the goods cleare d by manufacturer/assessee, the
Directors/employees of the manufacturer/assessee company - in respect of two
appeals where the matter was settled, penalty not imposable on appellant - however,
where the matter was not settled as entire duty was not paid, penalty imposed is in
order, also it is not on the higher side - two appeals allowed, and one appeal
dismissed: CESTAT [para 4.2, 5]
2015-TIOL-1730-CESTAT-DEL
M/s Ricela Health Foods Ltd Vs CCE (Dated: May 14, 2015)
CX - Whether fatty acids, wax and gum emerging as by-products during the refining
of crude vegetable oil are “waste” & entitled for the benefit of Nil rate of duty in terms
of notification 89/95-CE - conflicting judgments, hence matter referred to Larger
Bench: CESTAT [para 6, 7, 8]
Also see analysis of the order
2015-TIOL-1729-CESTAT-DEL
M/s Nova Industries Pvt Ltd Vs CCE (Dated: March 30, 2015)
Central Excise - Small scale exemption - C lubbing of clearance and demand of duty
on account of clandestine removals - Appellant challenge the Order in Original
confirming duty demand with penalties.
Held: Clubbing of clearances - Both the units are private limited and registered
with the Registrar of companies and both the units are having their units separately
located with a distance in some industrial area but there is no common gate for both
the companies. Further, both the companies are registered with Income-tax
Department, Sales-tax Department, Central Excise Department, Director of industries,
etc. as separate units. - Both the companies are having different brand names of their
product such as NOVA /DSA. The units are having their own separate machinery
having manufacturing the goods and same have been cleared on payment of duty by
availing SSI exemption of both the units separately. The only allegation is that
sometimes, salary of one of the employees was paid by the other firm or they are
managed by one person. Moreover, the dealers get the commission on the combined
sales of both the companies. These things cannot constitute that there was a
mutuality of interest and therefore, clearances of one unit cannot be clubbed with the
clearance of other unit. ( para 16)
The activity of the appellants were in the knowledge of the department as they were
registered with the Central Excise Department and units are located in the same
range, therefore, extended period of limitation is also not invokable for clubbing the
clearance of the two units. (para 23)
Clandestine clearances - No incriminating documents recovered from the custody of
the appellant or Managing Director thereof. On the basis of the investigation
conducted, the matter was referred to the Income-tax department also and the
Income-tax Department after further investigating the case found that the some
parties are manufacturing the duplicate goods and some employees of the appellant
were in league with the parties who are manufacturing duplicate goods. On the basis
of that investigation, the case booked by the Income-tax Department has been
dropped. Further, the case does not meet the test laid down by this Tribunal in the
case of Arya Fibres Pvt. Ltd. Vs. CC Ahmedabad-II r 2014-TIOL-15-CESTAT-AHM to
sustain the demand of clandestine removals - Demand set aside. (para 27)
2015-TIOL-1728-CESTAT-DEL
M/s National Engineering Industries Ltd Vs CCE (Dated: July 6, 2015)
CX - Appellant cannot be denied Cenvat Credit on the ground that Head Office is not
registered as Input Service distributor – Tribunal decisions in Demosha Chemicals
2014-TIOL-534-CESTAT -AHM & Doshion Ltd. 2013-TIOL-395-CESTAT -AHM followed appellant has correctly taken Cenvat Credit on the services namely Selling
Commission, Royalty, Consultancy & Professional, Banking Charges, Audit Fee, AMC
Charges, etc. - Appeal allowed with consequential relief: CESTAT [para 9]
2015-TIOL-1727-CESTAT-MUM
CCE & ST Vs M/s Reliance Industries Ltd (Dated: April 13, 2015)
CX - Commissioner(A) granting interest from the date being 3 months from the date
of application made for refund - Revenue in appeal contending that interest is payable
u/s 11B r/w 11BB of CEA, 1944, 3 months after the date of the appellate order. Held:
Issue is no longer res integra - Apex Court in the case of Ranbaxy Laboratories has
held that the assessee is entitled to interest on refund from the date on which the
three months end from the da te of application - Revenue appeals dismissed: CESTAT
[para 4, 5]
2015-TIOL-1726-CESTAT-MAD
Kyungshin Industrial Motherson Ltd Vs CCE (Dated: March 13, 2015)
Central Excise - CENVAT credit - admissibility of service tax paid on outward freight
(GTA) on FOR sale as input service credit is under dispute - denied by Commissioner
(Appeals) on the ground that appellants have failed to produce any documentary
evidence to the effect that terms of sale is on F.O.R Destination; agitated herein.
Held: The terms of supply is inclusive of freight, loading, unloading etc. and upto the
point of destination and terms of the delivery is F.O.R. destination and the unit price is
inclusive of freight and other charges - Tribunal in the case of Ultra Tech Cement
decided the very same issue and held that credit is entitled on GTA outward transport
service where the goods are sold on FOR basis - following the ratio of the same, held
that the appellants are eligible for credit on GTA outward transport service as it is
evident from the above that the sale is on FOR Destination basis - impugned order is
set aside [Para 5]
2015-TIOL-1725-CESTAT-MAD
M/s Supreme Automech (India) Pvt Ltd Vs CCE (Dated: May 27, 2015)
Central Excise - Refund of unutilized credit - Rule 5 of CCR 2004 - Denied in
adjudication - same upheld by Commissioner (Appeals) and agitated herein.
Held: When there was plea that accumulated credits were not possible to be utilised,
it should have been examined by the Commissioner (Appeals) - He has failed to do so
inasmuch as there is no enquiry to ascertain whether the finished goods of the
appellant was input of the EOU and such input consumed to manufacture final goods There was also no enquiry to suggest that the finished goods of the appellant were
unsuitable for use in manufacture by the EOU, nor to satisfy that the user EOU has
not earned foreign exchange - Gujarat High Court in the NBM Industries case held
that the input used in the manufacture of goods cleared by DTA unit to 100% EOU
entitles the DTA to the refund of the CENVAT credit accumulated but not possible to
be utilized. [Para 1, 2]
2015-TIOL-1723-CESTAT-AHM
M/s Nirma Ltd Vs CC & CE (Dated: March 18, 2015)
CX - MODAVAT/CENVAT - Claim of assessee was rejected on the ground that Rule 57E
of erstwhile CER, 1944 has put a bar for availing MODVAT Credit on account of fraud,
collusion, or any willful mis -statement or contravention of any rules - Settlement
Commission has given a categorical finding on bonafide of assessee - No material
available on malafide or mis -statement of fraud, on the part of assessee - Hence,
claim of assessee cannot be barred under Rule 57E of erstwhile Rules - Assessee
contends that they paid the amount of CVD as detailed in Annexure - Said annexures
were rejected on ground that said documents were unsigned - Matter remanded to
examine the claim of payment of CVD by assessee: CESTAT
2015-TIOL-1722-CESTAT-MAD
CCE Vs Kothari Sugars And Chemicals Ltd (Dated: June 8, 2015)
Central Excise - CENVAT credit - input credit on furnace oil used in generation of
steam whichis in turn used in the manufacture of electricity, denied in adjudication;
demand for its recovery confirmed with penalty - Commissioner (Appeals) set aside
the demands in terms of the Sudarshanam Spinning Mills decision, and is agitated by
Revenue herein.
Held: Tribunal's decision in the case of CCE Vs Sudarshanam Spinning Mills was
challenged by Revenue before the Madras High Court, in C.M.A.No.1636/2005 - The
High Court by its order dt. 4.8.2011 dismissed the CMA filed by Revenue upholding
Tribunal's decision on the issue and the issue has attained finality - the judgment of
jurisdictional High Court is binding; respondents are eligible for cenvat credit on
furnace oil; and there is no infirmity in the order of the lower authority which is
upheld. [Para 4]
2015-TIOL-1721-CESTAT-MAD
Coromandel Fertilizers Ltd Vs CCE (Dated: June 10, 2015)
Central Excise - CENVAT credit - appellants are manufacturers of fertilizers which are
fully exempted - During the course of manufacture of fertilizer, a bye -product viz.
Phospho Gypsum emerged and it was cleared on payment of duty - ‘Amounts' of 8%
& 10% of the value of exempted goods demanded under Rule 6(3)(b) of Cenvat Credit
Rules 2004 with equal penalty imposed under Rule 15 (2)ibidem; agitated herein.
Held: The adjudicating authority held that input services availed by the appellants
were used exclusively in the manufacture of exempted goods i.e. fertilizer - They
submitted application before Commissioner of Central Excise immediately after
retrospective amendment under Section 73(2) of Finance Act 2010 - Sub-Section (3)
stipulates that Commissioner of Central Excise shall examine the application and
verify the correctness of the amount paid within a period of 2 months from the date of
receipt of application or demand the differential amount, if the amount paid is less
than payable - evident from the records that same adjudicating authority recorded
that appellant had not obtained an order from the Commissioner in terms of Section
73(3) - the adjudicating authority and the authority to decide the application being
the same person, ought to have considered their application before deciding the SCN appellants have complied with entire reversal of cenvat credit along with interest - the
impugned order is set aside and the appeal is remanded to the Commissioner of
Central Excise with a direction to consider the application filed under Sec 73(2) of the
Finance Act 2010 and the records already submitted and decide the issue on merits
[Para 5]
2015-TIOL-1720-CESTAT-MAD
Godrej Saralee Ltd Vs CCE (Dated: March 17, 2015)
Central Excise - CENVAT credit - The issue in this appeal relates to denial of cenvat
credit availed by the appellant as a recipient on the Goods Transport Agency Services
against the input credit distributed by their registered office as ISD - demand for
recovery of credit with interest and penalty adjudicated and agitated herein.
Held: The adjudicating authority has denied the credit solely on the ground that their
registered office is not authorized to pay service tax on GTA after taking centralized
registration at Mumbai - he has discussed only on the provisions of centralized
registration and held that service tax paid by the corporate office is not eligible as
cenvat credit availed by the appellant - no dispute on the fact that appellant's
registered office at Mumbai obtained centralized registration for discharge of service
tax on various services including GTA services; and that the registered office is also
registered as ISD - Tribunal in the case of Rohit Surfactants, has discussed the
identical issue and held that the availment of cenvat credit by the respondent was
allowed where even the centralized registration was rejected by the department Number of decisions pronounced by judicial forums holding that admissibility of credit
cannot be questioned at recipient end - impugned order set aside [Para 5]
2015-TIOL-1715-CESTAT-MUM
MGM Industries Vs CCE (Dated: March 19, 2015)
CX - Classification - Appellant is manufacturer of control panes which are exclusively
manufactured for General Electric and can be put ot use for X-ray machines and the
application is exclusive - Both, Revenue and appellant agree that the goods are
covered under heading 9022.10 but the dispute is relating to rate of duty, whether
the goods can be considered as ‘parts and accessories' entitled for nil rate of duty
under notification 26/2002-CE. Held: Typically in a medical X -ray machine, there are a
number of independent apparatus which are put together and work as a system - it is
somewhat similar to a case of computer, which may have a monitor, CPU, keyboard
and printer, all of which are independent apparatus and work together - Parts and
accessories are separately listed in the HSN Explanatory Notes and x-ray control
panels and desks are not considered as parts and accessories - Keeping in view the
details given in the Explanatory Notes as also the scheme of X-ray system it is held
that the control panels are "apparatus" in themselves and cannot be considered as
"parts or accessories" - Undoubtedly, these apparatus are based on the use of X-ray
and are for medical purpose - These would be classified under Heading 9022.10, but
since these are not ‘parts or accessories', the same will not be entitled to the benefit
of nil rate of duty - Appeals dismissed: CESTAT [para 6, 6.2, 7]
2015-TIOL-1714-CESTAT-MAD
CCE Vs M/s Pleasant Foods (P) Ltd (Dated: May 19, 2015)
Central Excise - Assessment - The short issue is whether duty on the sugar
confectionery Nestle Eclairs and Nestle Milk Bar Eclairs manufactured and cleared in
pet jars and poly packs are to be assessed under Section 4 or under Section 4A Revenue agitates the impugned order assessing the goods under Section 4 of the
Central Excise Act 1944.
Held : Supreme Court in the case of Central Excise, Rajkot, Gujarat Vs Makson
Confectionery Pvt. Ltd. dismissed all the civil appeals filed by the Revenue, holding
that the impugned goods identical to those in the instant case would qualify for
exemption under Rule 34 of the Standards of Weights and Measures (Packaged
Commodities) Rules, 1977 and will not attract assessment under Section 4A of the
Central Excise Act, 1944 - Apex Court ruling was relied upon by the Bangalore bench
of the Tribunal in Sampre Nutrition Ltd. Vs Commissioner of Customs & Central Excise
(Appeals), Hyderabad - Commissioner in his impugned order has rightly dropped the
proceedings by relying on the Tribunal's order dated 25.01.2006 which now stands
upheld by the Apex Court - no infirmity in the impugned order which is upheld [Para
6, 7]
2015-TIOL-1712-CESTAT-MAD
CCE Vs Hindustan Petroleum Corporation Ltd (Dated: May 08, 2015)
Central Excise –CENVAT credit - short question in this appeal is whether CENVAT
credit not reversed by the principal manufacturer in respect of the inputs sent to the
job worker and the latter not taken credit thereof shall entitle the principal
manufacturer to the refund of any amount paid at a subsequent date without
reversing the CENVAT credit on the date of dispatch of the input to the job worker.
Held: Law prescribed reversal of CENVAT credit by principal manufacturer when the
goods are sent to job wo rker – Having failing to do so, the appellant is required to
reverse the same (already done) and deposit the penalty of Rs.5,000/ - imposed by
adjudicating authority – same stands confirmed [Para 2, 3]
Without reversal when the appellant has enjoyed the CENVAT credit it is liable to
interest thereon till payment by challan - due to confusion of the position of law, there
was no reversal and subsequent payment was made; therefore, neither appellant will
ask any interest nor the respondent shall ask any interest from Revenue - Respondent
is entitled to the refund of the amount of Rs.10,79,018/ - deposited by it without
interest in the peculiar facts and circumstances of the case – impugned order modified
accordingly - this order shall not be a precedent since this has been passed on the
given facts and circumstances of the case. [Para 4, 5, 6]
2015-TIOL-1707-CESTAT-DEL
Rajesh Gupta Vs CCE (Dated: June 08, 2015)
CX - Whether bricks manufactured by assessee are fly ash bricks, as contended by
Department or are sand lime bricks, as claimed by assessee - In invoices issued by
assessee, bricks are described as "sand lime, fly ash bricks" and assessee, for
manufacture of said bricks use 50% of wets pond ash and remaining quantity is of
lime and sand the lime being about 20% and sand being about 30% - No test has
been carried out to ascertain as to whether the bricks conform to ISI standards for fly
ash bricks or whether the same conform to ISI Standard for sand lime bricks - In
absence of such test, it would not be correct to say that bricks in question, are fly ash
bricks covered by heading 6815 - In terms of Ministry of Environment notfn, assessee
were required to use at least 25% fly ash - Though, admittedly weight of fly ash used
in form of pond ash is 50% and admittedly, pond ash contains moisture and, total
weight of ash being used in manufacture of bricks would be much less than 50% and
as such, it cannot be said that fly ash is pre -dominant constituent - Even if bricks are
treated as sand lime bricks, w.e.f, 1/3/11, same were no longer fully exempt from
duty and attracted 1% duty and admittedly the total duty liability is Rs. 3.10 lakhs Assessee is directed to deposit an amount of Rs. 3,10,000/ -: CESTAT
2015-TIOL-1706-CESTAT-AHM
Padmavati Tubes Vs CCE (Dated: June 25, 2015)
CX - ROM application has been filed by assessee on ground that issue of admissibility
of credit on raw materials and also eligibility of exemption under Notfn 7/97-CE has
not been deliberated by Tribunal - So far as admissibility of cenvat credit on raw
materials used in manufacture of finished goods is concerned, same is required to be
examined with respect to duty paying documents and private/statutary records
maintained by assessee to the effect that such inputs are received in factory premises
and used - Issue of eligibility under Notfn 7/97 -CE has also not been raised by
assessee before lower authorities and has to be examined by Adjudicating Authority
based on satisfaction of conditions specified in exemption Notfn - So far as benefit of
cum -duty benefit is concerned, this aspect is also required to be examined by
Adjudicating Authority after deciding extent of admissibility of Credit on raw materials
and exemption under said notfn - Option of granting 25% of reduced penalty under
Section 11AC of CEA, 1944 will also depend upon amount of short levy, if any,
quantified by Adjudicating Authority: CESTAT
2015-TIOL-1704-CESTAT-DEL
M/s New Allenberry Works V s CCE (Dated: February 04, 2015)
CX - M/s. NAW sent goods for job work to M/s. Sadhu Forgings Ltd and received back
after completion of job work - Defective goods were returned to M/s. Sadhu Forgings
Ltd. through invoice on which duty has been paid - O n receipt of said goods M/s.
Sadhu Forgings Ltd. took Cenvat Credit on duty paid by M/s. NAW - All the details
required under Rule 11(2) of CER, 2002 has been fulfilled - M/s. NAW has shown
purchase returns - Said information was not required to be shown in invoice as per
Rule 11(2) - M/s. Sadhu Forgings Ltd. has correctly availed Cenvat Credit as there is
no dispute regarding payment of duty by M/s. NAW on these goods and M/s. Sadhu
Forgings Ltd. has cleared goods on payment of duty after removing defects - As
appellants have not contravened the provisions of Rule 11(2) therefore, penalty on all
appellants are not imposable - Order set aside and appeal allowed: CESTAT [Para 8,
9]
2015-TIOL-1703-CESTAT-DEL
M/s Mittal Pigments Pvt Ltd Vs CCE (Dated: March 02, 2015)
CX - CENVAT Credit on inputs which has lost during process of manufa cturing at the
end of job worker - As per process of manufacturing, whatever input have sent to job
worker for manufacturing, definitely the assessee will not receive full quantity of
inputs converted into final goods - If whole of inputs have been used fo r
manufacturing and there is a process loss, same is required to be allowed - Revenue
has not contraverted, this contention with any supporting evidence that in process of
manufacturing of goods, there is no manufacturing loss and also have not obtained
any expert opinion - Assessee is entitled to take CENVAT Credit on inputs which has
gone for manufacturing at end of job worker: CESTAT
2015-TIOL-1702-CESTAT-MUM
Meegora Steels Pvt Ltd Vs CCE (Dated: June 02, 2015)
CX - Maintainability - s.35F of the CEA, 1944 - Pre -deposit - appellant filed appeals
without depositing 7.5% of the duty or penalty amount - appellant submitting that
they have no money to deposit the said amount and that the appeals should be heard
without any pre -deposit. Held: Tribunal is a creature of Customs, Excise & Service Tax
Acts and cannot go beyond the provisions of the same - s.35F clearly provides for
deposit of 7.5% and does not give any discretionary powers to waive the same Appeals not maintainable: CESTAT [para 4.2]
2015-TIOL-1699-CESTAT-DEL
M/s Amba Poly Crome (P) Ltd Vs CCE (Dated: May 22, 2015)
CX - Limitation - If assessee has taken cenvat credit wrongly, it means that he have
taken cenvat credit by mistake not with intention to take inadmissible cenvat credit SCN itself is alleging that assessee has taken cenvat credit wrongly and same has
been supported by earlier audit - When facts of wrong availment of credit was pointed
out to assessee, they reversed excess cenvat credit availed by them - Extended
period of limitation is not invokable - Penalty under Rule 15 of CCR, 2004 read with
Section 11 AC of CEA, 1944 is not imposable: CESTAT
2015-TIOL-1696-CESTAT-BANG
M/s G S Alloy Castings Ltd Vs CCE (Dated: July 28, 2015)
Central Excise - Allegation of CENVAT Credit taken without receipt of inputs - in the
case of clandestine allegation, the onus to establish the same is on the Revenue,
which is required to be satisfied by production of sufficient, tangible and positive
evidence . The uncorroborated statements of third party cannot be adopted as an
evidence, without corroboration from an independent source though such statements
can be of some value but cannot be solely relied upon for the purpose of holding
against the assessee.
Revenue has not bothered to make any investigation from the transporters even
though their names were available in the respective invoices. They have not found out
whether the vehicles number mentioned in the invoice, have been actually used for
the transportation of the goods or not.
Revenue is silent on the issue that if the appellant has not received the materials in
question, how have they manufactured the corresponding final products. It is not the
Revenue's case that they have procured the raw material from any other alternative
source. It is not only impractical but impossible to manufacture the final product
without raw material in question. The appellants having reflected the raw material in
their Cenvat credit account and having shown the u tilization of the same, heavy duty
stands cast on the Revenue to establish that such raw material was not the one which
was covered by invoice in question and stands procured by the assessee from any
other source. There is neither any allegation much less any evidence to reflect upon
the procurement of raw material from any outside source.
Also see analysis of the order
2015-TIOL-1695-CESTAT-MUM
M/s Finolex Cables Ltd Vs CCE (Dated: July 14, 2015)
CX - CENVAT - Rule 2(l) of CCR, 2004 - Whether appellant is entitled to take CENVAT
on Rent-a-cab services for transportation of workers from residence to factory - issue
is no longer res integra - in the case of Innovasynth Technologies (I) Ltd. - 2014TIOL-2440-CESTAT-MUM it is held that Rent-a-cab service is an input service - credit
admissible -appeal allowed with consequential benefits: CESTAT [para 2]
2015-TIOL-1694-CESTAT-MUM
Jsw Steel (Salav) Ltd Vs CCE (Dated: June 08, 2015)
CX - Applicant seeking extension of stay on the ground that their appeal has not come
up for disposal for no fault of theirs. Held: In the case of Venketeshwara Filaments
Pvt. Ltd. - 2014-TIOL-2388-CESTAT-AHM it is held that consequent upon omission of
1 st , 2 nd and 3 rd proviso to section 35C(2A) of the CEA, 1944 by the FA, 2014 it is
to be held that there is no provision for making further application for extension of
stay and that the stay order passed by the Tribunal, if it is in force beyond
07.08.2014, it would continue till the disposal of the appeals and there is no need for
filing any further applications for extension of orders granting stay either fully or
partially - since the stay in the present case was in force beyond 07.08.2014, same
would continue till the disposal of the appeal - Application disposed of: CESTAT [para
2, 3]
2015-TIOL-1693-CESTAT-MUM
M/s Mukand Ltd Vs CCE (Dated: October 29, 2014)
CX - CENVAT - Rule 2(l) of CCR, 2004 - Within factory premises, appellant
maintaining canteen as per statutory requirement u/s 46 of the Factories Act since
there are about 1000 employees - appellant is availing services of an agency to supply
required manpower/labour to enable them to run the canteen - ST paid on Manpower
supply is availed as credit by them - as there is no Outdoor Catering service availed,
there is no requirement of proportionate disallowance of credit - moreover, there is no
recovery of any element of ST from the employees - Credit admissible: CESTAT [para
4]
Gardening expenses - ST paid on the same is fully allowable as credit since the said
service is required for maintaining the good atmosphere in the manufacturing area
and is also a condition precedent laid down by the State Pollution Control Board
without which the appellant cannot resort to manufacturing activity: CESTAT [para
4.1]
Cleaning expenses - Expenses incurred for maintenance of res idential colony which
forms part of the factory premises as per the ground plan approved by the CE
authorities - there is no municipality in the area where the factory is located for
providing the services of township maintenance - colony is a small industrial township
and is required to be maintained by the Industry itself - disallowance of ST paid on
cleaning expenses set aside: CESTAT [para 4.2]
Vehicle hiring charges - no allegation in SCN to disallow any proportionate amount
towards the amount recovered in part from employees - disallowance held
unsustainable & hence order set aside to that extent: CESTAT [para 4.3]
Repair and maintenance of residential colony and maintenance of sports club/grounds
- ST disallowed - as appellant has not pressed for th e same, order upheld to the said
extent: CESTAT [para 5]
2015-TIOL-1692-CESTAT-DEL
M/s Ginni Non Woven Pvt Ltd Vs CCE & ST (Dated: June 04, 2015)
CX - Assessee company is a person registered under Rule 12 B of CER, 2002 - During
the period of dispute, fabrics got processed on job work basis and were exported by
assessee directly from job worker's premises without payment of duty under Rule 19
of Rules - Whether in terms of sub-rule (2) of Rule 12 B, assessee company was liable
to pay duty in respect of these goods - Since, there is no dispute that necessary
conditions for export under bond without payment of duty under Rule 19 have been
satisfied and prescribed procedure had been followed, Department's stand that duty
would be chargeable on clearance made by assessee for export from job worker's
premises is not correct - At the time of officers' visit to factory, RG-I register was sent
to Head Office for computerization and when it was produced, same had been updated
- Imposition of fine of Rs.50,000/- is reduced to Rs.10,000/- - Duty demand against
assessee company along with interest and equal amount of penalty and also penalty
of Rs.50,000/- imposed on Director under Rule 26 of Rules is set aside: CESTAT
2015-TIOL-1687-CESTAT-DEL
SPL Ltd Vs CCE (Dated: May 28, 2015)
CX - Once the Tribunal's judgment was affirmed by the Apex Court by dismissal of
Civil Appeal, the Tribunal's order merges with the Apex Court order and the same
becomes a binding precedent, whose non-consideration would be a mistake apparent
from record – ROM allowed: CESTAT [para 8, 9, 10]
Also see analysis of the order
2015-TIOL-1686-CESTAT-MUM
Annu Industries Vs CCE & C (Dated: May 5, 2015)
CX - CENVAT - Appellant availed inadmissible credit of Rs.2.55 lakhs of Basic Customs
duty and Education cesses on imported machinery although such duties are not
specified for availing credit under the CCR - also credit availed of Rs.25,192/ - on Steel
Purlins, Profile sheets, which are not capital goods within the meaning of rule 2(a) of
CCR, 2004 - Incorrectly availed CENVAT credit of Rs.2,80,525/- was immediately paid
by appellant on being pointed out by department and before issuance of SCN - Credit
disallowed & interest demanded of Rs.65,707/- and equivalent penalty imposed appeal to CESTAT against interest/penalty. Held: As per apex court decision in IndSwift Laboratories - 2011-TIOL-21-SC -CX , interest is chargeable right from the date
of availing inadmissible CENVAT credit in the account and not from the date of
utilisation - interest correctly demanded and confirmed - as regards penalty, appellant
has taken credit inadvertently and paid this amount without any contest and,
therefore, malafides cannot be attributed - fit ca se for waiver of penalty imposed u/s
11AC of CEA, 1944 - Appeal partly allowed: CESTAT [para 4]
2015-TIOL-1683-CESTAT-MUM
Mahindra & Mahindra Ltd Vs CCE (Dated: July 16, 2015)
CX - There is nothing in the CCR that before switching over to rule 6(2) a
manufacturer is required to reverse the credit of inputs available in its stores, work in
progress and in the finished goods on that date - in the absence of such prohibition,
demand of amount u/r 6(3)(b) till 24.9.2004 i.e. the date when assessee reversed the
credit attributable does not sustain - Appeal allowed: CESTAT
Also see analysis of the order
2015-TIOL-1679-CESTAT-MUM
Kulkarni Engineering Industries Vs CCE (Dated: June 09, 2015)
CX - Applicant seeking extension of stay on the ground that their appeal has not come
up for disposal for no fault of theirs. Held: In the case of Venketeshwara Filaments
Pvt. Ltd. 2014-TIOL-2388-CESTAT-AHM it is held that consequent upon omission of 1
st , 2 nd and 3 rd proviso to section 35C(2A) of the CEA, 1944 by the FA, 2014 it is to
be held that there is no provision for making further application for extension of stay
and that the stay order passed by the Tribunal, if it is in force beyond 07.08.2014, it
would continue till the disposal of the appeals and there is no need for filing any
further applications for extension of orders granting stay either fully or partially –
since the stay in the present case was in force beyond 07.08.2014, same would
continue till the disposal of the appeal - Application disposed of: CESTAT [para 2, 3]
2015-TIOL-1678-CESTAT-DEL
M/s India Glycols Ltd Vs CCE (Dated: May 18, 2015)
CX - De -natured rectified spirit manufactured and cleared by Gorakhpur Unit to
Kashipur Unit of same assessee company for its captive consumption - No dispute that
assessable value of de -natured rectified spirit was to be determined on basis of 110%
of cost of production under Rule 8 of Central Excise Valuation Rules, 2000 - Dispute is
only about application of CAS Format and its guidelines for calculation of cost - There
are considerable expenses each year on utilities which in terms of para 5.9 of CS
Format guidelines are to be treated as variable over heads and cost of variable over
heads is to be absorbed in costing based on actual captive utilization while this is cost
of utilities have been absorbed by assessee on the basis of normal capacity utilization
which prima facie is not correct and on this point, department has a case - Duty
demand based on absorption of cost of utilities in costing may be upheld - Assessee,
therefore, are directed to deposit an amount of Rs. 50 lakh: CESTAT
2015-TIOL-1677-CESTAT-MAD
Fenner (India) Ltd Vs CCE & ST (Dated: May 25, 2015)
Central Excise - Refund - while finalizing the provisional assessment for the period
1.4.2006 to 31.3.2009, original authority partly sanctioned the refund and partly
rejected the refund being excess duty paid in respect of discount passed through
invoices or by way of credit notes - portion of refund rejected upheld by Commissioner
(Appeals) and agitated herein.
Held: Appellants requested for finalization of provisional assessment and for valuation
on various discounts on stock transfer of goods from their factory/dealers - The
adjudicating authority while finalizing the provisional assessmen t for each year
ranging from 2006 to March 2009 partly sanctioned refund being excess duty paid at
factory on account of discount passed through depot/branch invoices and also
rejected the amount as it failed the test of unjust enrichment clause - The
Commissioner (Appeals) also held that said refund claims were hit by bar of unjust
enrichment in terms of the Tribunal ruling in the appellant's own case -impugned
claims are hit by bar of unjust enrichment; rejection of refund is valid and the
impugned order is upheld. [Para 6]
2015-TIOL-1676-CESTAT-MAD
CCE Vs M/s Kent Ceramic Tiles And Co Pvt Ltd (Dated: April 27, 2015)
Central Excise - Classification - Dispute in the instant case pertains to whether the
smaller pieces of the particular goods manufactured and affixed to a sheet is ceramic
tile, classifiable under CH 6905.10 as claimed by Revenue; or 6807.10 as claimed by
the assessee.
Held:Tribunal has rightly interpreted the meaning of the term 'ceramic' used in
Chapter 68 and 69 on the context of HSN Note in para 7 & 8 of its decision in the
Shon Ceramics case - That is exactly the goods cleared by Respondent and
Respondent's products are same as that of Shon Ceramics - Careful reading of para 8
of the decision throws light on characteristics of the goods - The use of the word
'ceramic' itself is not decisive in view of intention of the chapter; hence Tribunal
examined the rationale behind classification under Chapter 68 in its decision - It has
recorded that the products were made of 80% of the various stones such as quarts,
silica and feldspar chips and 20% or less of clay material for binding purposes
whereas Chapter 69 and Note 2 thereof applies only to ceramic products - Tribunal
found that in absence of evidence to show that the goods were not ceramic goods, the
goods shall fall under Chapter 68 instead of 69. [Para 5, 6, 7, 8]
No material from Revenue to show as to whether the goods of respondent were
technically tested by any recognized laboratory or national institute to hold that the
goods were ceramic - safe to rely on the finding of the Tribunal made in the aforesaid
decision for application thereof to the case of the assessee since its goods are similar
to that of M/s. Shon Ceramics not opposed by Revenue; Tribunal having examined
very carefully the composition of the cubes which are ultimately pasted on kraft paper
to give raise to the goods in question - Revenue's appeal fails on merit. [Para 9, 10]
2015-TIOL-1675-CESTAT-MAD
M/s Lotte India Corporation Ltd Vs CCE (Dated: March 13, 2015)
Central Excise - Stay / dispensation of pre deposit - CENVAT credit - short issue
involved in this appeal relates to reversal of cenvat credit which is equivalent to
proportional credit availed on trading of goods - demand with penalty adjudicated and
agitated herein.
Held: appellant is a manufacturing unit; availed the credit distributed by their ISD Tribunal in Eveready Industries case held that the Commissioner having jurisdiction of
the recipient unit has a power to examine the availment of cenvat credit - In view of
the Eveready decision and also considering the fact that the lower appellate authority
has confirmed only the proportionate credit and not the entire demand under Rule
6(5) on the value, prima facie, appellant do not satisfy the requirement for total
waiver of pre -deposit - appellant directed to deposit an amount of Rs. 5,00,000/ (Rupees five lakhs only) within four weeks. [Para 4]
2015-TIOL-1669-CESTAT-DEL
M/s Virgo Aluminium Ltd Vs CCE (Dated: June 24, 2015)
CX - Exemption notification 50/2003-CE - It is only on the date on which the
commissioning process has been completed that the plant is in a position to produce
the goods o f the desired quality and as per its installed capacity and when some
production has been made, that plant can be said to have commenced commercial
production, as it is at that stage only that the plant is in a position to start commercial
production - Adjudicating Authority must examine the Member Secretary, Single
Window Clearance Agency, Kala Amb, H.P., who had issued the certificate certifying
that the unit had commenced production on 31/03/2010 - Matter remanded: CESTAT
Also see analysis of the order
2015-TIO L-1668-CESTAT-MUM
Hindustan National Glass And Industries Ltd Vs CCE (Dated: May 15, 2015)
CX - CENVAT credit - Rule 2(l) of CCR, 2004 - Vehicle Maintenance service, Group
Health Insurance Service, Garden Maintenance service and Entertainment service are
services clearly covered under the definition of Input Service as they have nexus with
the production activity of the appellant's factory - Credit admissible - Appeal allowed:
CESTAT [para 4, 5]
2015-TIOL-1667-CESTAT-MUM
Hindustan Antibiotics Ltd Vs CCE (Dated: July 15, 2015)
CX - Valuation - s.11D of CEA, 1944 - Appellant is getting medicines manufactured on
loan licence basis from manufacturers which are located in areas where no Excise duty
is payable - such medicaments are sold to various government hospitals/dispensaries
etc. a t price fixed by NPPA under DPCO - case of Revenue is that NPPA while arriving
at the prices takes into account normal excise duty payable on such medicaments
and, therefore, appellant is deemed to have collected excise duty from customers and
which is recoverable u/s 11D of CEA, 1944. Held: Appellant is only trading in the
goods under dispute - they are selling goods at price fixed by NPPA - further they are
purchasing the same goods from the manufacturers at price fixed by NPPA with a
discount of 12 to 26.5% - Prices are composite ones and there is no separate
indication of excise duty on the invoices either of appellant or loan licencee - position
similar to that decided by Tribunal in case of HPCL - Appellant is not the manufacturer
of the goods and has not paid any excise duty - they are only trading and working
with the profit on the discount extended by the manufacturer on the price fixed by
NPPA - there is merit in the submission that if at all there has to be any liability to pay
any amount u/s 11D o f CEA, 1944, it will be with the manufacturer of the goods and
not with appellant - Appeal allowed: CESTAT [para 4, 5]
2015-TIOL-1666-CESTAT-AHM
M/s Filatex India Ltd Vs CCE, C & ST (Dated: March 20, 2015)
CX - Assessee cleared goods under cover of ARE-3 on strength of CT-3 certificates
without payment of duty issued by M/s. Enkay Texofood Industries Ltd - Assessee
submits that said Company issued CT-3 certificates to assessee following the
procedure under Rule 20 of CER, 2002 - Said Company in their letter dated
07.10.2004 had mentioned detail the references of 13 nos. ARE-3 out of which 3 nos.
ARE-3 were mentioned in DGCEI letter dated 23.07.2008 - As per Rule, 20 (3) of
Rules, said company, 100% EOU admitted the receipt of goods and therefore,
responsibility for payment of duty casts upon them - It is clearly evident that said
Company had received goods and it was not entered in inbond register - As per
Skyron Overseas 2009-TIOL-2414-CESTAT -AHM , duty liability cannot be raised on
assessee: CESTAT
2015-TIOL-1665-CESTAT-DEL
CCE Vs M/s A B Sugar Ltd (Dated: January 21, 2015)
CX - Assessees engaged in manufacture of Sugar, Ethyl Alcohol and Fusel Oil - By
letter dt.25.09.2003, they informed Superintendent of CE that they would like to set
up a distillery unit and final product will be incorporated in registration certificate as
soon as the machinery is installed in plant of distillery unit - By letter dt. 15.07.2004,
assessee requested for amendment of CE Registration certificate - Adjudicating
Authority observed that distillery unit is forward integration for captive use of one of
the major by-products of sugar industry i.e . Molasses and both these units belongs to
same company and are under same management, unit has same sales tax registration
and common Income Tax No. - Assessee is entitled to avail credit from 20.07.2004
when the registration certificate was issued to dis tilliery unit - Assessee would be
liable to pay interest for availing 50% of credit prior to registration - It is not clear as
to whether assessee had utilized credit prior to registration which is required to be
examined by Adjudicating Authority - Case remanded: CESTAT
2015-TIOL-1664-CESTAT-DEL
M/s DSCL Sugar Ajbapur Vs CCE (Dated: May 20, 2015)
CX - During course of manufacture of final products, 'Bagasse' emerged as a byproduct, which is used by assessee captively for generation of electricity within factory
- Electricity so generated is used in factory for manufacture of final product and part
of generated electricity is sold to outside parties for a consideration - No separate
accounts maintained - No rate of duty has been prescribed for "electrical energy"
classified under Chapter sub-heading 27160000 in CETA, 1985 - No specific notfn has
been issued by Central Government in exempting electrical energy from payment of
CE duty - Once cenvat credit has been reversed along with interest, there was no
requirement for CE department to proceed further for imposition of penalty, especially
by invoking pro visions of Rule 15(2) of Rules - Non-reversal of cenvat credit is not
attributable to any fraud, collusion and mis -statement and accordingly, provisions of
Rule 15(2) of CCR, 2004 read with Section 11AC of CEA, 1944 cannot be invoked for
imposition of pena lty on assessee: CESTAT
2015-TIOL-1659-CESTAT-AHM
M/s Zircon Plastics Pvt Ltd Vs CCE (Dated: June 30, 2015)
CX - There has to be an illicit manufacture of goods to indulge in clandestine removals
for which extra raw material, extra manpower, transportation of finished goods, cash
payments etc. are required to be established with a reasonable degree - In the
absence of any corroboration, case of clandestine removal cannot be held as
established on the basis of few parallel invoices recovered from a third party: CESTAT
[para 5.2, 5.3, 5.4, 6.1]
Also see analysis of the order
2015-TIOL-1658-CESTAT-AHM
M/s Indian Oil Corporation Ltd Vs CCE & ST (Dated: June 30, 2015)
CX - Admissibility of CENVAT credit of service tax paid on Study and Designing of
Storm Water drainage development - Assessee was under bonafide belief that such
CENVAT credit was admissible - Mere failure to pay duty or taking license is not
enough to invoke extended period - When CENVAT credit is reflected in periodical
returns then extended period can not be invoked - As per Pushp Enterprises - 2011TIOL-297-CESTAT -DEL , appeal filed by assessee is allowed on time-bar: CESTAT
2015-TIOL-1657-CESTAT-AHM
M/s Rajputana Steel Casting Pvt Ltd Vs CCE & ST (Dated: June 23, 2015)
CX - Assessee is manufacturing Stainless Steel Ingots - It is the case of Revenue that
S.S. Articles mentioned in diary maintained by Shri B.D. Patel a re clandestinely
manufactured and cleared by main assessee in addition to quantity of S.S. Articles
mentioned in statutory records - As per CA's certificate dt.10.10.2007, assessee has
been certified to have a monthly production capacity of 225 MT. Approximately, same
quantities of S.S. articles have been reflected in monthly returns filed by assessee
during relevant period - Without any contrary expert opinion, it is not justified on part
of lower authorities to brush aside such a certificate given by Chartered Engineer
which is quantitatively comparable to quantities manufactured by assessee and shown
in monthly returns - No indication of excess raw materials procured and extra power
used - No seizure of clandestinely removed finished goods or seizure of a ny cash from
clandestine transactions involved in such suspected clandestine removals - On the
basis of few confessional statements, diluted by cross-examination of those witness,
cannot be made the basis of clandestine manufacture and clearances of excisa ble
goods and accordingly duty demanded by Revenue is not sustainable - Appeals filed
by main assessee to that extent and appeals filed against penalties imposed upon
other assessees, with respect to such duty demanded, are allowed - Grounds taken
before t his Bench, that such shortage of inputs is negligible and should be ignored, is
rejected as not entertainable as the same was not agitated before lower authorities:
CESTAT
2015-TIOL-1656-CESTAT-MAD
M/s Veena Processing Mills Ltd Vs CCE (Dated: May 01, 2015)
Central Excise - ACP based duty - short issue involved in this appeal relates to duty
demand under compounded levy scheme for the period 1996 -97 on the ‘Hot air
Stenter' installed by the appellant under Independent Textile Processors with Annual
Capacity of Production Determination Rules, 1998 - Duty demand under Rule
96ZQ(5)(i) along with interest and penalty under Rule 96ZQ(5)(ii) of CER, 1944
adjudicated; penalty reduced by Commissioner (Appeals); agitated hereunder.
Held: Issue has been decided in the case of Sanoo Fashion, where the Tribunal relied
upon the ruling pronounced by High Court of Madras and allowed the appeal - the
lower appellate authority has not considered the Madras High court order and relied
upon the Gujarat High Court decision in the case of Ambuja Cements - Both the lower
appellate authority and the Tribunal joined by the decision of High Court of Madras
order in the case of Beauty Dyers holding that the impugned order was set aside as
ultra vires - Following the same, impugned order in the instant case is set aside. [Para
4]
2015-TIOL-1655-CESTAT-MAD
M/s Habasit Lakoka Pvt Ltd Vs CCE (Dated: March 17, 2015)
Central Excise - CENVAT credit - Appellants are manufacturers of ‘Transmission &
Conveyor Belts', having Unit-I and Unit-II located in the same town and availing
cenvat credit on inputs and on capital goods - interest demand on the credit amount
availed an d reversed on the inputs cleared as such to Unit-I during the material period
was raised on Unit-II - recovery of interest with penalty under Rules 14 & 15 of CCR
2004 adjudicated, upheld by Commissioner (Appeals), and agitated herein.
Held: The impugned clearance of inputs amounts to inter-unit transfer of inputs and it
is not the case of the department that appellant's Unit-II has utilized the credit - The
Principal Bench rulings in the case of Kesarwani Zarda Bhandar and Sona Koyo
Steering Systems are squarely applicable to the facts of the present case - High Court
of Delhi in the case of Kwality Ice Cream Company also held that demand of interest
raised after three years is hit by limitation - appellants are not liable for demand of
interest and penalty; impugned order set aside. [Para 6]
2015-TIOL-1654-CESTAT-AHM
Larsen And Toubro Ltd Vs CCE & ST (Dated: May 06, 2015)
CX - Assessee had undertaken job work of installation, erection and construction of
various plants and machineries of M/s Reliance Petrochemicals Ltd (RPL) at their site,
for which raw materials have been provided by M/s RPL - It is found from Adjudication
order that assessee had undertaken construction of jetty and to meet with emergent
requirement during construction work, they have fabricated temporary structures for
said construction activities - That temporary structure for construction of jetty, was
made cut of material supplied by M/s RPL, which was dismantled after work is over
and material given back to M/s RPL - According to Revenue, it is like pontoons - Onus
lies with Revenue in respect of marketability of product - Marketability cannot be
established on basis of mere sale of goods - No material found that structures
constructed by assessee for purpose of construction of jetty is commercially known as
similar to Pontoons in any manner: CESTAT
2015-TIOL-1653-CESTAT-MAD
Hcl Infosystems Ltd Vs CCE & ST (Dated: May 21, 2015)
Central Excise - Stay / dispensation of pre deposit - Exemption - appellant is
manufacturer of computers including "Thin Client" - The issue is whether the said
"Thin Client" is computer and entitled for concessional rate of duty of excise under
notification No.6/2006-CE as applicable for computers - Revenue viewed that the
appellant had cleared "thin client" and "software" under the same invoices; duty on
software is discharged @8% whereas duty on thin client is discharged @12% differential duty on the whole value of such thin client including the value of software
@16% adv was confirmed by the original authority, upheld by Commissioner
(Appeals) and agitated herein.
He ld: Prima facie, the appellant has not made out a case for full waiver of pre -deposit
- He is directed to make pre-deposit of an amount of Rs. 4,00,000/- (Rupees four
lakhs only) within a period of eight weeks [Para 2]
2015-TIOL-1649-CESTAT-MAD
Hindustan Petroleum Corporation Ltd Vs CCE (Dated: June 04, 2015)
Central Excise - Valuation - appellants are having warehouse at Coimbatore for
storage of petroleum products and discharging central excise duty on the non -duty
paid products received from the refinery - duty demand with interest and penalty
confirmed on the delivery charges and road freight subsidy charges collected f rom the
customers but not included in the assessable value; same agitated herein.
Held: The Bangalore Bench of the Tribunal, in the case of CCE, VishakapattinamVs.
BPCL, IOCL, HPCL dismissed the Revenue appeals and held in favour of the assessee
vide Final Order No.387 to 390/2012 dated 7.6.2012 - Further, in the appellant's own
case related to Mangalore CE jurisdiction, appeal was allowed by the Tribunal (and
upheld by Apex Court) wherein identical circumstances were considered under the
material period when administered price mechanism was in vogue and depot was
place of removal - Following the same, impugned order in the present case set aside.
[Para 3-6]
2015-TIOL-1648-CESTAT-AHM
M/s Sarin Chevli Vs CCE, C & ST (Dated: June 25, 2015)
CX - Assessee has supplied grey fabric to M/s Deepak Processors under CENVAT paid
documents - No diversion of fabrics or raw materials dealt by assessee has been
seized - Penalty against assessee is not solely based upon his statement because
proprietor of M/s Deepak Processors in his statement has also admitted that CENVAT
credit was availed on fraudulent documents without receipt of goods - Adjudicating
Authority after going through all relying upon documents and statements concluded
that M/s Sai Textiles, Surat has issued invoices without physically transacting in goods
and passed on only CENVAT credit to M/s Deepak Processors - No reason to interfere
with the same - Appeal rejected:
2015-TIOL-1647-CESTAT-DEL
M/s Suraj Vanaspati Ltd Vs CCE (Dated: February 25, 2015)
CX - MODVAT / CENVAT - Issue is whether the Cenvat Credit lying unutilized as on
22.07.1996 when the Vanaspati Oil was exempted from duty can be utilized for the
payment of duty on Vanaspati Oil in the month of May 2004 when the duty was
introduced - Calcutta H igh Court has in Rasoi Ltd. while allowing the petition has held
that the petitioner is entitled to invoke such vested right and SLP filed by Revenue
was dismissed by apex court - also in the case of Agarwal Industries the Tribunal has
held that the accumulated credit would not lapse - appellant has correctly utilized
CENVAT credit lying unutilized as on 22.07.1996 - appeal allowed with consequential
relief: CESTAT [ para 6, 8, 9]
2015-TIOL-1646-CESTAT-AHM
M/s Shreeji Concast Ltd Vs CCE & ST (Dated: January 05, 2015)
CX - Refund - Assessee engaged in manufacture of MS Ingots and discharged duty
liability on basis of Annual Capacity of Production (ACP) provisionally fixed by CCE as
5 MT - It was subsequently re-determined by Tribunal as 4 MT instead of 5 MT Assessee placed Chartered Accountant certificate to substantiate that duty incidence
was not passed to customers - Assessee should be given an opportunity to place said
certificate before adjudicating authority to establish that duty was not passed on to
customers, in interest of justice - Impugned orders upheld on merits, but,
adjudicating au thority shall examine said certificate and any other evidence: CESTAT
2015-TIOL-1644-CESTAT-MAD
CCE Vs GGN Spinning Mills Pvt Ltd (Dated: December 19, 2014)
Central Excise - Capital goods - respondents are engaged in the production of cotton
yarn; they have removed capital goods to their sister concern on payment of duty on
the value adopted by way of depre ciation (by Write Down Value Method) @ 25% as
per the Income Tax Act - Differential duty demand with interest and penalty
adjudicated; Commissioner (Appeals) set aside the same which was agitated by
Revenue - Tribunal remanded the matter to original authority to compute depreciation
on straight line method in terms of CBEC Circular dated 21.04.1998 - Respondent
agitated the Tribunal remand before the High Court who in turn remanded the case to
the Tribunal for disposal of appeal on the basis of the relevant circular and legal
provisions.
Held:The adjudicating authority has confirmed the differential duty by following the
Circular dated 1.7.2002 and adopted the value on the capital goods by following the
depreciation as per the Board's circular dated 26.5.1993 - the impugned order set
aside the adjudication order on the ground that there is no provision for reversal of
credit in the CCR for removal of capital goods which are used and also held that
Board's circulars are not applicable as the said circular relates to valuation of second
hand machinery and are not applicable to the capital goods and also held that there is
revenue-neutrality - the issue of removal of capital goods after use and the reversal of
credit thereof on the depreciated value is settled by the Madras High Court in the case
of CCE Vs Rohini Mills; same squarely applicable to the present case - Following the
ratio of the Rohini Mills and Navodhaya Plastic Industries rulings, appellants are liable
to pay differential duty on the value of capital goods removed to their sister unit by
adopting depreciation as per the Board's circular No.643/34/2002 dt. 1.7.2002 read
with Circular No.495/16/1993-Cus. dt.26.5.93 - However, considering facts and
circumstances, penalty set aside and OIO restored accordingly. [Para 5, 6]
2015-TIOL-1639-CESTAT-MUM
Mr Haresh Goradia Vs CCE (Dated: December 19, 2014)
CX - Fraudulent rebate - Appellants are traders providing fictitious invoices without
supply of any goods, brokers operating on commission basis enabling encashment of
demand draft and returning the balance amount after deducting commission of 0.25%
- It has nowhere been found that the appellants have acquired possession or handled
any excisable goods in any manner, rendering the goods liable to confiscation - CCE is
in error in imposing Penalty u/r 26 of CER, 2002 - Amount deposited of Rs.20 lakhs
during investigation by Shri Hemant Patel, Proprietor of M/s Shreeji Traders to be
refunded along with interest within 45 days - Appeals allowed: CESTAT [para 10, 11]
Also see analysis of the order
2015-TIOL-1638-CESTAT-AHM
M/s Ketan Plastic Industries Pvt Ltd Vs CCE & ST (Dated: June 10, 2015)
CX - Issue is regarding duty demand on shortage of finished goods found in factory
premises of assessee during visit of departmental officers and admissibility of cenvat
credit on duty paid on inputs received from 100% EOU - No contrary judgment has
been brought on record by the learned AR with respect to non admissibility of cenvat
credit of education cess paid during the relevant period - As per Emcure
Pharmaceuticals Limited 2008-TIOL-226-CESTAT -MUM , cenvat credit of education
cess is admissible to assessee - Amendment to proviso added to Rule 3(7)(a) of CCR,
2004 will have respective effect so that admissible credit is not denied to assessee,
accordingly, credit with respect to SAD is admissible - Assessee has paid entire
amount of duty/cenvat credit demanded in SCN along with 25% of penalty - In view
of cenvat credit allowed with respect to education cess and SAD, amount of remaining
cenvat credit disallowed and quantum of 25% penalty is required to be reworked out Penalty on director of company is reduced: CESTAT
2015-TIOL-1637-CESTAT-AHM
M/s Chiripal Industries Ltd Vs CCE & ST (Dated: May 21, 2015)
CX - National Calamity Contingency Duty (NCCD) on Partially Oriented Yarn (POY) and
FDY when used captively in manufacture of goods - When POY is sold as such by
assessee, NCCD is paid by assessee at the time of clearance from factory - Issue of
leviability of NCCD during captive consumption is no more res integra - By following
decision in case of Modern Petrofils Ltd - 2009-TIOL-515-CESTAT -AHM , appeal
allowed: CESTAT
2015-TIOL-1636-CESTAT-AHM
M/s Afcons Infrastructure Ltd Vs CCE & ST (Dated: May 29, 2015)
CX - Refund - Assessee engaged in construction of Turbine Building, CCW Plant and
Pump Houses as per agreement with Nuclear Power Corporation Limited, a
Government of India Enterprises - Assessee received fusion bonded Epoxy Coating of
Re-Inforcing Steel Bar from M/s. PSL who paid CE duty and cleared said product to
assessee - M/s. PSL informed that assessee had paid CE duty and therefore, they are
eligible to get refund of duty under Section 11B of CEA, 1944 - Manufacturer paid the
duty under protest - Refund claim was rejected on ground that assessee had not
furnished sufficient evidence that incidence of duty was not passed on to their
customers - Assessee produced CA's certificate certifying that assessee paid a sum by
way of excise duty on products against invoices raised by M/s. PSL and confirmed that
no part of duty paid on said products has been reimbursed by customer Nuclear Power
Corporation Limited - Genuinety and authenticity of certificate was not doubted by
both authorities below - No material available on record to discard CA's certificate Hence, there is no need to furnish cost of material and pricing of contract - Appeal
allowed: CESTAT
2015-TIOL-1635-CESTAT-DEL
M/s Iol Chemicals And Pharmaceuticals Ltd Vs CCE & ST (Dated: April 28,
2015)
CX - Cenvat credit denied on services namely insurance, audit and transportation on
the premise that assessee being the job worker and doing work under exemption
Notfn 214/86 and cleared the goods without payment of duty to p rincipal
manufacturer - Assessee has already reversed Cenvat credit before issuance of SCN Out of Rs.1,58,775/- assessee has utilized only Rs.48,386/- - As per Strategic
Engineering P Ltd. 2014-TIOL-466-HC-MAD-CX , assessee is required to pay interest
only on Rs.48,386/ - during intervening period - When assessee is not contesting
merits of case, penalty is not imposable in light of M/s. Atul Ltd. 2012-TIOL-1384CESTAT -AHM - Appeal allowed: CESTAT
2015-TIOL-1634-CESTAT-DEL
M/s Mi Telecom Solutions Pvt Ltd Vs CCE (Dated: January 07, 2015)
CX - Assessee besides the manufacture of goods on their own account, they also
doing job work for M/s.Acme, who were availing full duty exemption under Notfn
50/2003-CE - From process diagrams in premises of MI Telecom and M/s Acme and
photograph of goods which emerge in premises of M/s.MI Telecom and which emerge
in premises of M/s. Acme, it appears that goods being cleared by M/s MI Telecom
from their premises to M/s. Acme are only incomplete battery management systems,
electrical panels, air-cooling systems and line-regulators and complete and finished
battery management systems, electri cal panels, air-cooling systems and line
regulators come into existence only in premises of M/s. Acme - Assessee's plea is that
no finding has been given by Commissioner on this point - Impugned order is set
aside and matter remanded to Commissioner: CESTAT
2015-TIOL-1632-CESTAT-MUM
Ciron Drugs & Pharmaceuticals Pvt Ltd Vs CCE (Dated: July 15, 2015)
CX - s. 35F of CEA, 1944 - Pre -deposit - appellant had reversed some amounts of
CENVAT credit during the years 2009-10 onwards on their own and these are a matter
of dispute with reference to the duty demand confirmed of Rs.4.49 crores - they are
not amounts re versed during the course of investigation - adjustment of these
amounts cannot be examined for maintainability of appeal as it will amount to going
into the merits of the case at stay stage - since appellant had not deposited 7.5% of
duty demanded, appeal not maintainable, however, in the interest of justice, time
given of two weeks to make deposit and report compliance: CESTAT [para 4, 5, 6]
Also see analysis of the order
2015-TIOL-1627-CESTAT-DEL
CCE Vs The Heels (Dated: May 28, 2015)
CX - Manufacture - Assessee, a partnership firm of which Shri Amit Gupta is a partner
engaged in trading activity of three types - No dispute in respect of first two types of
trading activity - Third type of trading activity is subject matter of dispute, which
involves purchasing of footwears in unit containers bearing brand name - Shoes are
received in unit containers with brand name declared on containers but without any
MRP - Department views that assessee put their MRP sticker on containers themselves
- Acco rding to assessee, MRP stickers are put on footwear and not on container and
from SCN also, it appears that MRP stickers were being put on footwears and not on
containers - Commissioner (A) has held that MRP stickers were being put on footwear
and not on containers, and therefore, this activity would not amount to manufacture
under section 2F (iii) of CEA, 1944 - No dispute that sales turn over of third category
of footwear along with sales turn over of footwear bearing assessee's own brand name
was within SSI exemption limit - Without going into question as to whether activity of
assessee amounted to manufacture or not, it is held that even if it is treated as
manufacture, they would be eligible for SSI exemption, there would be no duty
demand - Appeal dismissed: CESTAT
2015-TIOL-1626-CESTAT-MAD
SKI Carbon Black (India) Pvt Ltd Vs CCE (Dated: April 27, 2015)
Central Excise - Stay/dispensation of pre deposit - Excisibility - Pollutant emerges as a
by-product while using the input Carbon Black Feed Stock in the process of
manufacture; same used to generate electricity sold to TNEB - duty demand on the
pollutant is agitated herein.
Held: Considering the reasoning given by the Apex court in the case of Union of India
Vs Hindustan Zinc Ltd., there shall be waiver of predeposit and stay of recovery of
demand in question during pendency of appeal. [Para 5]
2015-TIOL-1625-CESTAT-BANG
CCE, ST & C Vs Sri Sarvaraya Sugars Ltd (Dated: March 3, 2015)
Central Excise - Cenvat credit availed on inputs - Demand to reverse on ground that
dutiable products cleared as such - Manufacture of aerated water and clearance in
glass bottles - Held, that bottles were cleared after having been used for a number of
yea rs as such cannot be considered as clearances - Further more, show-cause notice
was issued under CCR 2004 by which time the clearances had already been completed
thus proceedings were initiated under non-existing provisions as such cannot be
sustained - No infirmity in the order of the Commissioner (A) holding that notice cited
no applicable Rule so order in original cannot be sustained - Revenue appeal fails.
(Para 5)
2015-TIOL-1624-CESTAT-AHM
M/s Torrent Pharmaceuticals Ltd Vs CCE, C & ST (Dated: June 30, 2015)
CX - Assessee had filed appeals against OIA dated 23/28-01/2004 with CESTAT as
well as JS (Review) Government of India - Since on earlier occasion same issue was
remanded back by JS(Review) only appeal filed with JS(Review) was persued resulting
into dismissal of their appeal before CESTAT, for non-prosecution - In Final Order
passed by JS (Review) it was held that appeal in these proceedings lies before CESTAT
- Restoration application filed by assessee is allowed: CESTAT
2015-TIOL-1622-CESTAT-DEL
M/s Udaipur Pipes Pvt Ltd Vs CCE (Dated: March 4, 2015)
CX - Assessee engaged in manufacture of ACC pipes AC Couplers and availing
exemption under notfn 6/2000 -CE, 3/2001-CE and 6/2002 -CE which prescribed nil
rate of duty for goods of chapter 68 in which not less than 25% by weight of fly ash or
phosphogypsum or both have been used, subject to condition specified in said notfn Assessee in this regard were maintaining records as prescribed in exemption notfn
and were also filing a monthly return along with ER -1 returns - Department's case
against assessee alleging that they were not using fly ash to extent of at least 25% is
based only on state ment of some persons - As per Basudev Garg 2013-TIOL-464-HCDEL-CUS statement given by a person cannot be used against an assessee without
giving assessee an opportunity of cross examining the deponent - W hen
Department's case is mainly based on statements given by some persons and those
statements are not corroborated by some other independent evidence, and contradict
each other, for using those statements, against assessee for proving charge of duty
evasion against them, their cross examination would be necessary - Impugned order
set aside and matter remanded: CESTAT
2015-TIOL-1617-CESTAT-DEL
CCE Vs Free Scale Semiconductors India Pvt Ltd (Dated: June 12, 2015)
CX - Refund - Assessee, a 100% EOU engaged in business of processing of chips,
activity which includes circuit designing, testing, validation of such chips, integration
of software on chips and support services for its parent company viz., M/s.Free Scale
Semiconductors Inc.USA - As per section 65 (19) of FA, 1994, activity undertaken by
assessee would come within definition of BAS - Contention of Revenue that activity of
processing of chips is a manufacturing process and that it would fall within definition
of 'manufacture' under section 2(f) of CEA, 1944 does not find merit at all - No ground
to interfere with concurrent findings arrived at by adjudicating au thority as well as
appellate authority: CESTAT
2015-TIOL-1616-CESTAT-MAD
Hindustan Photo Films Mfg Co Ltd Vs CCE (Dated: March 17, 2015)
Central Excise - CENVAT credit - The short issue in this appeal relates to denial of
cenvat credit availed by the appellant on the basis of T.R.6 challan; of CVD paid on
Jumbo Rolls of Cinematographic Film purchased from Customs auction/sale; on the
ground that TR6 Challan is not a specified document for availing credit.
Held: The adjudicating authority has not disputed the payment of CVD on the said
goods; the credit was denied only on the limited ground that T.R.6 challan is not a
valid document - Notification No.16/1994 (CE) clearly provides various documents and
certificate issued by various agencies are treated as admissible documents for availing
modvat credit under Rule 57G - import of the jumbo rolls by an importer were
absolutely confiscated by the Kandla Customs - Once confiscated, it becomes the
property of Govt and the Customs authorities have to sell/dispose the same and
appellant being the only PSU manufacturing photographic films, it has to be
necessarily given to the appellant's unit - no dispute on the sale and the purchase of
entire cinematographic film and the appellants paid the amount as per the price
arrived by the Customs which is inclusive of CVD - This is supported by a certificate
issued by the AC of Customs, Kandla stating that the price of the Jumbo rolls includes
CVD duty leviable on the goods -Tribunal ruling in the Hindustan Corporation case
relied upon - credit availed by the appellant on the T.R.6 challan which is duly
supported by the Customs by a certificate is a valid documen t for availing credit impugned order set aside. [Para 4]
2015-TIOL-1615-CESTAT-MAD
Aluminium Powder Co Ltd Vs CC, CE & ST (Dated: April 29, 2015)
Central Excise - CENVAT credit - denial of various input and input services credit in
adjudication and demand for recovery of the same with interest and penalty agitated
by the parties, and commonly disposed of herein.
Held: In terms of Final Order No.40281-40326/15, dated 25.02.2015, Tribunal has
allowed Cenvat credit in respect of both input and input services used in setting up of
windmill, generation of power and maintenance as well as operation thereof - Para 2
to 6, 10 of the same being relevant that equally applies to the present appeals. [Para
3, 4]
Normal maintenance and services availed in respect of functioning of windmill are
allowed - In view of Para 10 of the FO dated 25.02.2015, credit of service tax paid on
rental services is allowed - Revenue has no evidence to the contrary to establish that
there is no integral relation between the security services availed to protect the
windmill and ensure operation thereof - Cenvat credit on security service is also
allowed - Appellant having established the connection of the processing charges paid
to the financial institutions to borrow fund for purchase of windmill and machinery,
service tax paid on such services is allowed towards Cenvat credit- Workers contribute
to the production for which their welfare measure is essential under the Factories Act no evidence on record to show that policy relates to any other property or contingency
- Cenvat credit relating to service tax paid on availing insurance services for workers
is allowable [Para 5.2, 7 - 10]
In respect of Outward Transportation of goods, it was established that such services
was part of the contract and was inseparable; credit allowed - Blades being affixed to
the windmill at a quite high level from the earth, using of service of crane for such
purpose cannot be said to be without nexus to maintenance of the windmill - Cenvat
credit in respect of service tax paid to avail the services of the crane is allowed [Para
15, 16]
Gear box for windmill being intimately connected with the set up and running of the
windmill credit of duty paid thereon is allowable [Para 12]
Cenvat credit on service tax paid to avail passenger carrying package policy is
claimed, but no evidence was produced to show that such a policy has any integral
connection either to any output or output services - credit thereon is not allowable Telephone installed outside factory and used by staff is not backed by any evidence to
show that such services were in any way connected with output services or
manufacture of the ou tput - credit of service tax paid to avail such service is not
allowable - without the connection of the insurance policy to the workplace or
workers, the claim of Cenvat credit on service tax paid in respect of insurance service
is not allowable - There is a claim of availing club services, which are no way
concerned for either manufacture or providing of output services; hence the claim of
input credit thereof is not allowed [Para 11, 13, 14, 17]
In view of the difficulty of interpretation of law relating to Cenvat credit involved for
long time there shall not be penalty in any of the appeals [Para 18]
2015-TIOL-1614-CESTAT-MAD
CCE Vs Lumax Samlip Industries Ltd (Dated: March 25, 2015)
Central Excise - CENVAT credit - respondent are manufacturers of "Head Lamp
Assembly" and Motor vehicle parts - Officers visiting the Unit observed that they
availed modvat credit on the capital goods "Injection Moulding Machine" and also
claimed depreciation under Section 32 of the Income Tax Act, 1961 in violation of of
sub-rule (8) of Rule 57R of Central Excise Rules - demands adjudicated for recovery of
ineligible credit, with interest under Rule 57 (4) read with Section 11AB and penalty
under Rule 57U (6) read with Section 11AC apart from penalty under Rule 173Q; set
aside by Commissioner (Appeals) and agitated by Revenue - Revenue's appeal
rejected vide Final order No.1702/2009 dt. 12.11.2009; recalled vide MISC Order dt.
11.11.2003 and taken up for disposal herein.
Held: Respondent had filed T1 declaration under Rule 57T of Central Excise Rules
intimating the Department that they intend to avail credit of the duty paid on capital
goods - They have filed T2 declaration before A.C Division and declared that they shall
not claim depreciation under Section 32 of the Income Tax Act - in their Income Tax
return filed before the Income Tax authorities they duly claimed depreciation on the
value of capital goods credit, which was duly accepted by the Income Tax department
- it is admitted fact that during the relevant period, respondents on the one side
availed credit of duty paid on the capital goods and also claimed depreciation under
Section 32 of the Income Tax Act. [Para 13]
The deliberate misdeclaration and willful suppression of facts by the respondents was
established by the adjudicating authority - undisputed fact that but for the
Departmental officers detecting the case it would not have come to notice and this
fact was completely ignored by Commissioner (Appeals) and there is merit in the
revenue appeal - the impugned order waiving interest and penalty under Section
11AC and restoring the Modvat credit to the respondent w.e.f. 30.6.99 is liable to be
set aside and the adjudication order demanding the credit, confirming interest and
imposing penalty under Section 11AC is liable to be restored [Para 16]
The CIT(A) order relied upon by the lower appellate authority was tracked - by virtue
of Supreme Court's order dt. 6.8.2012 the rectification application under Section 154
stands dismissed and claiming depreciation under Section 32 of IT Act had attained
finality - respondents have no legal grounds to enjoy both Modvat credit on capital
goods under Central Excise Act and depreciation under Income Tax Act; hence they
are not eligible to avail capital goods credit in terms of Rule 57R (8) of Central Excise
Rules - Penalty under Sec 11AC and Rule 173Q warranted in terms of the ruling in the
Bageshwari Sa hakari Sakhar Karkhana case [Para 18, 20]
2015-TIOL-1611-CESTAT-DEL
M/s Jai Maa Appliances (P) Ltd Vs CCE (Dated: March 12, 2015)
CX - Both the assessees JMAPL and SE are job workers for KEL and they subject the
goods received from KEL to certain processes and, thereafter, return the same to KEL
- Both assessees and also principal manufacturer KEL are located in area specified
under notfn 50/03-CE - In both cases, assessee's claim is that items being cleared by
them to KEL are not fully finished goods but have to be subjected to further
processing like grinding, spindle pressing and testing - If items being cleared by
assessee are in nature of semi finished goods which require further processing by KEL
for being used as parts of fans, same cannot be treated as marketable and hence,
excise duty would not be chargeable: CESTAT
CX - Limitation - When both JMAPL and SE could have availed full duty exemption
under notfn 50/03-CE just by filing declaration and they did not file declaration for
availing of this exemption under belief that their activity does not amount to
manufacture, no malafide can be attributed to them - Even if there is any duty
demand confirmed against assessee, longer limitation under proviso to section 11(i)
would not be applicable and for same reason, penalty under section 11AC would not
be imposable: CESTAT
2015-TIOL-1610-CESTAT-MUM
Nrb Bearing Ltd Vs CCE (Dated: May 15, 2015)
CX - s.35F, s.35C(2A) of CEA, 1944 - Any stay order passed by the Tribunal, if it is in
force beyond 07.08.2014, it would continue till the disposal of the appeal and there is
no need for filing any further applications for extension - Tribunal decision in
Venketeshwara Filaments - 2014-TIOL-2388-CESTAT -AHM followed - Application
allowed: CESTAT [para 2, 3]
2015-TIOL-1609-CESTAT-MUM
Ajay Kumar G Baheti Vs CCE & C (Dated: July 09, 2015)
CX - HR Trimmings sold by appellant in online auction to brokers - Invoices prepared
in name of Silver Ispat, Mah. State knowing fully well that the goods were consigned
to Viramgam based bidder and are being used by SSI units situated there who do not
avail CENVAT credit - Penalty imposable: CESTAT [para 15 to 19]
Also see analysis of the orde r
2015-TIOL-1608-CESTAT-AHM
M/s Apar Industries Ltd Vs CCE & ST (Dated: March 26, 2015)
CX - Assessee were issuing supplementary invoices for goods already cleared and paid
proper duty on such supplementary invoices - In case of reduction of price, they have
already paid excess duty of Rs.33,51,793.00 - Refund claim was filed on 12.04.2010
which was returned by Range officer on 29.04.2010 as there were no sufficient
documents - Assessee again resubmitted the claim on 29.09.2010 with all documents
as directed by Range Officer - Assessee by letter dt.21.10.2010 had categorically
requested to withdraw the amount of Rs.6,47,473.00 as they had no documentary
evidence and requested to sanction remaining amount of Rs.27,04,323.00 - In
certificate dt.22.04.2011, no specific mention of this amount - Hence, both the
authorities below has rightly rejected refund claim of Rs.6,47,473.00 - Rejection of
refund of Rs.19,26,095.00 as time barred is set aside - Matter remanded: CESTAT
2015-TIOL-1607-CESTAT-AHM
CCE Vs M/s Nirma Ltd (Dated: April 13, 2015)
CX - Assessee cleared the excisable goods to their sister unit/other units on payment
of duty as per Rule 9 read with Rule 8 of CEVR, 2000 at 110% of cost of production of
goods - No consistency in methods of valuation as claimed by assessee - Adjudicating
Authority had elaborately discussed inconsistency of valuation methods Inconsistency of valuation methods cannot be treated as suppression of fact with
intent to evade payment of duty - Assessee informed the Department time to time of
variation of price and Department was well aware of method of price as declared by
assessee - No suppression of fact with intent to evade payment of duty: CESTAT
2015-TIOL-1604-CESTAT-BANG
Bhagavathymadom Ayurveda Nikethanam Vs CCE, C & ST (Dated: January 1,
2015)
Central Excise - Ayurvedic or Cosmetic preparations - Classification - Ingredients of
the preparations mentioned in authoritative text books of Ayurveda - Board's Circular
No. 25/91 dated 03.10.1991 talks about the twin tests of common parlance test and
mentioning of the ingredients in the authoritative books on Ayurveda medicines laid
down by the Supreme Court in determining the classification and further clarifies that
in doubtful cases of Ayurvedic medicines the Collectors are required to make a
reference to the Board seeking clarification from Drug Controller - Chemical Examiner
has merely opined on the classification of the product under Chapter 33 and nothing
in the report to indicate whether the Chemical Examiner has examined the product
from the angle of its ingredients - Copy of the report was not supplied to the appellant
- On facts, impugned order set aside - Appeal allowed by way of remand to original
authority to adjudicate afresh in accordance with due process of law. (Para 7, 8, 9)
2015-TIOL-1600-CESTAT-DEL
N R Sponge Pvt Ltd Vs CCE & ST (Dated: April 10, 2015)
CX - Assessee is manufacturer of sponge iron - It is alleged that assessee
clandestinely removed goods - Statement recorded after almost 4 years also does not
reveal anything incriminating against assessee - No investigation was conducted at
the end of buyers when assessee categorically stated that they are not arranging and
only buyers are arranging transport of goods - Demand is not sustainable merely on
basis of entries made in transporters register without any corroborative evidence Revenue failed to produce any corroborative evidence in support of their allegation Impugned order set aside and appeal allowed: CESTAT [Para 6, 7, 8]
2015-TIOL-1599-CESTAT-MAD
CCE Vs Measurement & Controls India Ltd (Dated: April 24, 2015)
CX - Interest - In these appeals, demand of interest confirmed on (a)the differential
duty paid subsequently on the price variation raised on supplementary invoices; along
with penalty under Rule 25(1) (a) of CER, 2001and (b) interest on the differential duty
paid consequent to finalization of the provisional assessments, under Rule 7(4) of
CER,2002 are in dispute with relief granted by Commissioner (Appeals) agitated by
Revenue herein.
Held: In respect of (a), there is no dispute on the fact that the appellants paid
differential duty on the amount of escalation of price and raised supplementary
invoices to their customers - On the payment of interest the law is settled by the
Supreme Court in the case of CCE Vs. SKF India - ratio of the same is squarely
applicable to the facts of the present case and the respondents are liable for payment
of interest; the impugned order is liable to be set aside to the extent - However,
considering overall facts of the case and also in view of the conflicting decisions of
various judicial forms for and against the interest payment till it was settled by the
Apex Court, the respondents are not liable for any penalty and the same stands
waived - appeal partly allowed [Para 7]
In respect of (b), issue decided by Mumbai HC in the Ispat Industries case and the
same upheld by Apex Court - Tribunal also allowed the appeal in the respondent's own
case - impugned order upheld and Revenue's appeal rejected [Para 8]
2015-TIOL-1598-CESTAT-DEL
Kawatra Papers Ltd Vs CCE (Dated: March 16, 2015)
CX - Clandestine removal - It is alleged that assessee involved in clandestine removal
of goods on the basis of certain records and statements of some persons relied upon,
which were not allowed to be cross examined remained unproved - Adjudicating
authority is not an expert to determine production capacity but an expert from
Institute of Paper Technology examined production capacity of assessee and after
inspection of factory of assessee and collecting necessary data for production
capacity, expert determined the production capacity for working plant during period
1996-97 and 1997-98 - Therefore, without tangible evidence or without being
obtaining expert's opinion on issue, said report determining production capacity
cannot be rejected by adjudicating authority - Machine log sheets were specifically
directed by Tribunal to examine in depth but adjudicating authority rejected those
machine log sheets on ground that the same are manipulated and afterthought Adjudicating authority has not considered any defence taken by assessee in remand
proceedings, but pass the order by confirming demand against assessee and
imposition of penalty in mechanical manner - Charge of clandestine removal is not
sustainable - Appeals allowed: CESTAT
2015-TIOL-1597-CESTAT-DEL
Avon Cycles Ltd Vs CCE & ST (Dated: February 02, 2015)
CX - Assessee are manufacturers of E-Bikes which they assembled out of imported
components/kits - Some of imported components are also re -packed for sale as spare
parts - Commissioner, relying upon verification report of Divisional Officer reporting
that E bikes kits for being assembled and parts for being sold as spares, were being
imported separately and as such they were not using common inputs for manufacture
of E-bikes and spare parts, has held that provisions of rule 11 (3) of CCR, 2004 would
be applicable in respect of E-bikes - Assessee is directed to deposit an amount of 10%
of cenvat credit demand: CESTAT
2015-TIOL-1596-CESTAT-AHM
CCE & ST Vs Dincotex Pvt Ltd (Dated: April 17, 2015)
CX - Deputy Commissioner, CE already adjudicated the SCN dt.06.05.1996 vide OIO
dt.14.11.1996 and therefore, confiscation of goods and imposition of redemption fine
in respect of seized goods by Adjudicating authority in de-novo adjudication cannot be
sustained - Regarding demand of duty along with interest and imposition of penalty by
SCN dt.28.01.2000, assessee challenged authenticity and preparation of Panchnama Assessee contends that demand of duty on basis of diary has no nexus with their
factory - Revenue filed this appeal on the ground that by not producing witnesses for
cross examination, Panchnama cannot be treated as invalid evidence - As per Basudev
Garg 2013-TIOL-464-HC -DEL -CUS , statement against assessee cannot be used
without giving them opportunity of cross -examining deponent - Cross-examination is
a valuable right of accused/noticee in quasi- judicial proceedings, which can have
adverse consequences for them - Appeal rejected: CESTAT
2015-TIOL-1592-CESTAT-DEL
Satya Prakash And Co Vs CCE (Dated: March 16, 2015)
CX - Assessee is manufacturer of branded chewing tobacco and packed the same with
help of 2 packing machines during said period - Assessee filed abatement claim on
pro-rata basis for period 1.9.11 to 15.9.11 in respect of non operative period of
"second machine " - When a manufacturer of Gutka/Pan Masala is manufacturing
Gutka/Pan Masala pouches of different RSPs and for a certain period of 15 days or
more, he stops production of only one particular RSP, he will not be entitled for
abatement, if continues the production or clearances of Pan Masala/Gutka of other
RSPs by operating those machines - As per rule 10 of Pan Masala Packing Machine
Rules, 2008, there should be complete stoppage of machine which is not in matter in
hand - Assessee has not satisfied condition of grant of abatement as production in
factory of notified goods was in operation - Therefore, assessee is not entitled for
abatement: CESTAT [Para 7, 9, 10]
2015-TIOL-1591-CESTAT-DEL
Shri P K Verma Vs CCE & ST (Dated: November 25, 2014)
CX - Commissioner vide his impugned order has confirmed demand of duty and
penalties jointly and severely against M/s. Golden Tobacco Ltd. and M/s. Chinar
Cigare ttes Ltd. - It is well settled law that such joint confirmation of duties and joint
imposition of penalty cannot be upheld in law - For earlier proceedings against M/s.
Golden Tobacco Ltd., such orders passed by Commissioner already stand set aside As su ch, by following the same, impugned order set aside and matter remanded to
Commissioner for fresh decision - Assessee submits that there are around 10
allegations and they have been provided with relied upon documents relatable to only
4 to 5 allegations - Pinciples of natural justice would be duly complied with by
Commissioner - Hoping that Central Board of Excise & Customs (CBEC) takes these
matters against M/s Golden Tobacco Ltd. seriously and this time matter is adjudicated
strictly in accordance with observations and directions in this order, and as
expeditiously as possible: CESTAT
2015-TIOL-1588-CESTAT-AHM
Shri Dinesh Magrupal Vs CCE (Dated: December 12, 2014)
CX - Assessee, 100% EOU supplied raw materials to main noticee under cover of CT3
certificate after observance of procedure prescribed under CER, 2002 - There is no
dispute that main noticee received the raw material supplied by assessee - Raw
materials received by main noticee, who diverted the goods unlawfully and demand
was raised on them - There is no material available on involvement of assessee for
alleged diversion of finished goods by main noticee - It is well settled that penalty
cannot be imposed merely on basis of assumption and presumption and without any
basis - As per Marvel Fashions 2010-TIOL-1826-CESTAT -AHM , penalty imposed on
assessee is set aside and appeal allowed: CESTAT [Para 6, 7, 8, 9]
2015-TIOL-1585-CESTAT-MUM
M/s Mahanagar Gas Ltd Vs CCE (Dated: November 21, 2014)
CENVAT -Inputs short received - CENVAT credit cannot be denied of tax paid on
Inward Transportation service when the fact is that there is no dispute on account of
availment of credit on inputs - Credit rightly availed - appeal allowed: CESTAT [para
6, 7]
2015-TIOL-1579-CESTAT-MAD
CCE Vs M/s Pan Electronics India Ltd (Dated: April 17, 2015)
CX - Penalty - SCN issued demanding reversal of cenvat credit on the inputs LDO
allegedly not received in their factory but diverted to their sister unit - demands
adjudicated and agitated before Commissioner (Appeals), who remanded it to original
authority for verification of related documents about the genuineness of receipts of
inputs and admissibility - proposals dropped by original authority agitated by Revenue
before Commissioner (Appeals) in the second round of litigation, contending that
respondents are liable to reverse the cenvat credit availed on the inputs used in the
generation of electricity diverted to other units - Commissioner (Appeals) allowed
Revenue's plea and held that duty demand with inte rest is recoverable, but allowed
reduced penalty of 25% under Sec 11AC - Revenue agitates impugned order for
imposition of equal penalty under Sec 11AC.
Held : Evident that the adjudicating authority has dropped the entire proceedings, it is
only on appea l by the Revenue, that Commissioner (Appeals) has restored part of the
demand for the first time - Lower Appellate Authority has rightly held that the
respondents are eligible for reduced penalty within 30 days; no infirmity in the order
which is upheld- facts are supported by the decision of the High Court of Gujarat in
the case of Rita Dyeing & Printing Mills - no merit in Revenue's appeal. [Para 6]
2015-TIOL-1578-CESTAT-DEL
M/s Bhoramdeo Sahakari Shakkar Utpadak Karkhana Maryadit Vs CCE
(Dated: June 12, 2015)
CX - During disputed period, assessee had availed cenvat credit of Central Excise Duty
paid on structural steel items, namely, MS beams, channels, angles, flats, Plates and
joist, treating the same as input for manufacture of plant and machinery installed
within factory - Documents available in case record prove beyond any shadow of
doubt that the fact regarding taking of cenvat credit by assessee on disputed goods
were known to the Department - Since SCN has been issued in 2008, covering the
period from June, 2002 to January, 2006, and no specific findings have been recorded
regarding involvement of assessee in any fraudulent activities concerning fraud,
collusion and miss -appropriation with intent to evade payment of duty, proviso to
section 11A, cannot be invoked, justifying issuance of SCN, beyond limitation period
of one year - Proceedings initiated by Department for recovery of cenvat amount is
barred by limitation of time and accordingly, impugned order is set aside and appeal
allowed: CESTAT
2015-TIOL-1577-CESTAT-DEL
Kamal Sponge Steel And Power Ltd Vs CCE (Dated: March 23, 2015)
CX - Assessee manufactures M.S.Ingots and from M.S.Ingots, they manufactures
M.S.Bar and TMT bars - Allegation of quantity of finished goods found short, and
clandestine removal - Duty demand of Rs.9,89,44,328/ - based on power consumption
and it is clear that demand was quantified by dividing total power consumption during
period of dispute by 669.835 - Assumption of department is not correct, as quantity
alleged to have cleared during a particular month based on certain seized documents
may not have been manufactured during that month and therefore, for purpose of
determining power consumption for production of one MT TMT bar/MS bar, this
quantity cannot be treated as quantity produced during that month - Neither any
experiment has been conducted for ascertaining actual power consumption nor there
is any evidence of unaccounted purchase of MS scrap or evidence of clandestine
clearance of finished goods - Only evidence of clandestine clearance of finished goods
is in form of seized documents including computer printouts and shortage of finished
goods and duty involved in respect of demand Rs.1,40,93,563/- based on the same
has already been paid which is sufficient for hearing of appeals - Balance duty
demand Rs.9,89,44,328/ - does not appear to be sustainable - Stay granted: CESTAT
2015-TIOL-1576-CESTAT-DEL
Perfetti Van Melle India Pvt Ltd Vs CCE (Dated: May 22, 2015)
CX - Exemption notfn 6/02CE - Assessee are manufacturers of bubble gum - Period of
disputes is from 28/04/2005 to 28/02/2006 - Whether clearances of bubble gum
during this period were eligible for concessional rate of duty under notfn
06/02CE(serial no. 247) - Bubble gum contains sugar and is classifiable under heading
1704 of Central Excise Tariff pertaining to "sugar confectionary (excluding white
chocolate) not containing cocoa" - When w.e.f. 28/02/005 heading 1704 had been restructured and as per re -structured heading, sub-heading 170490 covered bubble
gum, and during period w.e.f. 28/2/2005, exemption notfn 06/02CE (serial no. 247)
continued to prescribe concessional rate of duty for "sugar confectionary (excluding
white chocolate) not containing cocoa covered by heading 170490" - Benefit of
exemption under this notfn cannot be denied as there is no dispute that bubble gum
contains sugar and is covered by expression "sugar confectionary (excluding white
chocolate) not containing cocoa" and during period w.e.f. 28/02/2005 heading 170490
also covered bubble gum: CESTAT
2015-TIOL-1575-CESTAT-DEL
M/s Shree Alloys Industries Pvt Ltd Vs CCE & ST (Dated: April 27, 2015)
CX - Clandestine removal - it is admitted by the Managing Director as well as other
officials that they have cleared goods on the strength of 38 gate passes to their other
units - appellant submits that there were no records found in the receiving units as to
whether they have received the goods on the strength of 38 gate passes or not obviously clandestinely received goods will not be recorded by recipient units demand rightly confirmed: CESTAT [para 10]
Penalty - Whether appellant is entitled to take Cenvat Credit on steel items or not was
in dispute - appellant has already reversed Cenvat Credit along with interest - in the
circumstances, penalty not imposable: CESTAT [para 11]
CENVAT - As residential colony have no nexus with the manufacturing activity of the
appellant, appellant is not entitled to avail input service credit on construction services
of residential colony - divergent views exist on the subject matter, hence penalty not
imposable: CESTAT [para 12, 13]
Limitation - Investigation was conducted during the period 15.08.2008 to 20.12.2008
and show cause notice has been issued on 14.09.2010 by invoking extended period of
limitation - in view of apex court decision in Orissa Bridge & Construction Corpn. Ltd.,
demand is time barred: CESTAT [para 14, 15]
2015-TIOL-1572-CESTAT-DEL
CCE Vs M/s Meera And Company (Dated: February 11, 2015)
CX - Notfn 56/02-CE - Assessee's unit is located in the area specified in said notfn and
goods are also covered for exemption under same notfn - Dispute is in respect of
goods supplied to M/s Reliance Telecom Infrastructure Limited against invalidated
EPCG licence - Assessee claimed refund of excise duty from DGFT - Since, the
assessee had availed exemption under said Notfn in respect of goods supplied by
them against invalidated EPCG licences, the assessee should not have claimed refund
of terminal excise duty from DGFT and since they have claimed refund, DGFT has
imposed penalty on them - This cannot be the ground for denial of benefit of
exemption notification to the assessee - No merit in appeals, so, same are dismissed:
CESTAT [Para 6]
2015-TIOL-1571-CESTAT-MUM
M/s Oil & Natural Gas Corporation Ltd Vs CCE, C & ST (Dated: July 9, 2015)
C X - Provisions of Rule 9 of CCR does not provide any restriction clause that the credit
is not allowed in respect of invoices issued by input service distributors in respect of
service received by them prior to registration as input service distributor - Cenvat
Credit cannot be denied on the ground that input service distributor have received
services prior to the obtaining registration as ISD – Rs.27.79 crores demand set
aside: CESTAT [para 6]
Also see analysis of the order
2015-TIO L-1566-CESTAT-AHM
M/s Gupta Synthetics Ltd Vs CCE & ST (Dated: June 1, 2015)
CX - Assessee engaged in manufacture of Articles of Textiles - It is alleged that
assessee has wrongly availed CENVAT credit on MS Channels, Angles, M.S. Bars and
Beams - In reply to SCN, it is stated that these materials were used for fabrication of
machines namely, Winder Frame, Air Handling System, Cooling System and Dryer
Structure - Weight, size and nature of machines was such that its fabrication/ fixing to
structures was essential with nuts and bolts because attachment is not permanent and
what is attached can be easily detached - Assessee claimed that these items are
accessories used in plants and machineries - Assessee availed credit on these items
and decla red in their ER-1 returns - No material was available that assessee
suppressed the fact with intent to evade payment of duty - Impugned order can not
be sustained on merits as well as on limitation: CESTAT
2015-TIOL-1565-CESTAT-AHM
M/s Micro Inks Ltd Vs CCE & ST (Dated: May 19, 2015)
CX - Change of Cause Title - Assessee enclosed a certificate of incorporation
consequent to conversion of Company from Public Company to Private Limited
Company - Registry is directed to amend cause title; insofar as assessee's name
would be M/s. Micro Inks Private Limited" instead of "M/s. Micro Inks Limited" Appeal was not taken for hearing by Tribunal as there is huge pendency of appeals - A
lot of appeals have already been listed and therefore it is difficult to take up appeal
hearing at this stage - Extension of stay granted: CESTAT
2015-TIOL-1564-CESTAT-MAD
M/s Packaging India Pvt Ltd Vs CCE (Dated: May 26, 2015)
Central Excise - CENVAT credit - Tax paid on various services associated with
feasibility study for setting up factory at Uttaranchal admissible as input services
credit under Rule 2(l) of CCR 2004 - Credit held admissible having nexus to the
business.
2015-TIOL-1563-CESTAT-MUM
Kome Steel Industries Pvt Ltd Vs CCE (Dated: January 23, 2015)
CX - Appellant received wire rods for reducing their thickness which were imported by
one P.K. Trading Co. - no invoice from P.K.Trad ing Co. to appellant - CHA vide letter
dated 20.10.2005 had given details of goods' movement - although there are
procedural irregularities, from the documents it is established that the goods were
received by appellant and were used in manufacturing proce ss and also the finished
goods were cleared on payment of duty - No reason to deny the cenvat credit:
CESTAT [Para 4]
2015-TIOL-1561-CESTAT-DEL
M/s Bajaj Hindustan Ltd Vs CCE (Dated: June 17, 2015)
CX - Input service credit denied on Pandal and Shamiana service, tour operator
services, construction services - Assessee is a manufacturer of sugar and molasses As per Ultratech Cement Ltd. 2010-TIOL-745-HC-MUM-ST, any service availed by the
assessee being a manufacture of excisable goods in the course of business is entitled
for Cenvat Credit - It is not disputed by Revenue that services in question were not
availed by assessee in course of their business of manufacturing of excisable goods It is also not disputed that assessee has not constructed residential colony and has
not used tour operator services for carrying their employees from their residence to
factory and factory to residence - Therefore, assessee is entitled to take Cenvat
Credit: CESTAT
2015-TIOL-1556-CESTAT-MUM
Avery Dennison India Pvt Ltd Vs CCE (Dated: July 3, 2015)
CX - By keeping in view the commercial necessity of the appellant and benevolent
nature of Rule 16C of the CER, 2002, CCE, Pune -IV to grant permission to the
appellant under Rule 16C of the Rules for the FY 2015-2016 - Appeal allowed: CESTAT
[para 8, 8.1]
Also see analysis of the order
2015-TIOL-1555-CESTAT-MUM
New Phaltan Sugar Works Vs CCE (Dated: May 15, 2015)
CX - s.35F, s.35C(2A) of CEA, 1944 - Any stay order passed by the Tribunal, if it is in
force beyond 07.08.2014, it would continue till the disposal of the appeal and there is
no need for filing any further applications for extension - Tribunal decision in
Venketeshwara Filaments - 2014-TIOL-2388-CESTAT -AHM followed - Application
allowed: CESTAT [para 2, 3]
2015-TIOL-1554-CESTAT-DEL
Bajaj Hindusthan Ltd Vs CCE (Dated: June 8, 2015)
CX - Assessee is manufacturer of sugar and molasses - They constructed dormito ry
within their factory for stay of these technicians/engineers as same may be called as
and when if there is a fault in plant or machinery and took cenvat credit on
construction services - It is alleged in SCN that dormitory is located outside factory
premises but assessee in reply has clearly mentioned that dormitory is constructed
within factory premises and said fact has not been contradicted by Adjudicating
Authority or first appellate authority - Construction of dormitory for purpose of stay of
technicians/engineers is integrally connected with manufacturing activity of assessee Credit is available as that service has been availed in business of manufacturing
activity - Appeal allowed: CESTAT
2015-TIOL-1553-CESTAT-MAD
M/s Bharat Industries Vs CCE (Dated: April 15, 2015)
Central Excise - clubbing of clearances - Revenue established that the appellant
manufacturer created three fictitious firms and showed ghost clearances - duty
demand with interest confirmed and penalties imposed on firm and individuals under
Rule 9(2) read with Rule 173Q of the Central Excise Rules, 1944, agitated by the
appellant manufacturer alone herein.
Held: Narration in the show cause notice brings out categorically how the appellant
arranged its affairs in a manner detrimental to the interest of Revenue creating three
fictitious units which were only bubbles - Appellant had only one manufacturing unit
and in reality, entire clearance made by three fictitious concerns were that of the
appellant - No material on record to suggest that fictitious units were in reality
manufacturers; they were neither registered with the Excise Authorities nor machinery
installed by them to carry out manufacture - no evidence of any purchase of raw
material, consumable or packing material nor payment of electricity charges to prove
manufacture occurred; no muster roll of the workers engaged ; no registration under
the PF Act or ESI Act was made to disclose identity of workers - appellant failed to
contradict allegations of Revenue in absence of credible evidence led by it - clubbing
of clearances for assessment to duty sustains. [Para 5.1, 5.2]
No allegation / record as to under-valuation of the impugned clearances made adjudication on such count of arbitrary valuation fails and value disclosed by appellant
shall be followed to recompute duty liability of appellant on clubbing all four
clea rances - looking into the gravity of the matter, upon redetermination of duty
element adopting the value of clearances declared by appellant, penalty to the extent
of the duty evaded shall be demandable. [Para 5.3, 5.4]
2015-TIOL-1552-CESTAT-MAD
Loyal Textile Mills Ltd Vs CCE (Dated: April 17, 2015)
CX - Limitation - Current appeal results from remand ordered by High Court with
directions to decide the dispute on limitation.
Held: JRO forwarded an audit para on 06.08.2004 and sought payment of duty on the
basis of said para relating to value of used capital goods - SCN was issued only on
6.10.2005; therefore, it is evident that there is no suppression of facts - Even by
taking into account letter dt. 6.8.2004, the demand should have been issued within
one year - clearly established that demand is hit by limitation - Impugned capital
goods have been imported on 9.8.95 under EPCG scheme and subsequently cleared to
their sister unit on payment of duty - audit raised by the department, limited only to
demand of differential duty on account of wrong calculation of depreciation value - no
allegation of any contravention of provisions of rules; no suppression of facts or
intention to evade payment of duty - The impugned order is set aside.
2015-TIOL-1547-CESTAT-DEL
Bajaj Hindustan Sugar And Industries Ltd Vs CCE (Dated: June 8, 2015)
CX - Remission of duty on molasses which became unusable due to auto -combustion Assessee is manufacturer of sugar and molasses and stored the molasses in steel
tanks in factory premises due to heat of summer season - Auto-combustion took place
in factory and molasses have been destroyed - To avoid auto-combustion, assessee
has taken care to save molasses - Assessee has taken steps to save auto -combustion
by way of spraying water to keep lower the temperature of tanks, recirculation of
molasses and use of anti foaming agents - Nothing more has been suggested by
adjudicating authority to avoid auto combustion - Accident of auto-combustion was
beyond the control of assessee, therefore assessee is entitled for remission of duty as
claimed: CESTAT
2015-TIOL-1540-CESTAT-MAD
CCE & ST Vs Noor Trading Mart (Dated: March 31, 2015)
Central Excise - Stay/dispensation of pre deposit - documents seized and examined,
based on which Revenue concluded clandestine clearances - demands adjudicated and
penalties imposed on firms and individual, agitated herein.
Held: Material gathered during investigation demonstrates prejudice caused to
Revenue - Accordingly, direction for pre-deposit against all the appellants is warranted
in the fitness of the circumstances of the case - Making overall assessment of the
facts and circumstances of the case and striking out balance between the case of the
Revenue and pleadings of the appellants, they are directed to pre -deposit amounts of
Rs. One lakh, twenty lakh and three lakh respectively, within six weeks. [Para 9, 10
2015-TIOL-1539-CESTAT-MAD
CCE Vs Nettur Technical Training Foundation Industries Ltd (Dated: April 27,
2015)
CX - Valuation - demands confirmed on the grounds that (i) the development charges
collected from the buyers of component for developing the tools are to be added
proportionately to the components supplied; (ii) the amount collected from the buyers
of the components for the cost of tools is also to be proportionately included to the
assessable value of the components; (iii) an amount collected separately from the
buyers of the components under the head 'Excise duty' on the tools used in the
manufacture of components prior to the introduction of Section 11D also to be added
to the assessab le value for redetermining the same; and (iv) revision in the cost of
inputs supplied by the buyers had to be adopted and the assessable value of the
components to be revised - same agitated herein.
Held: There is no dispute by Revenue that the finished goods are not liable to duty;
therefore there shall not be any controversy on the issues in (i) and (ii) - assessee is
required to deposit the amount collected as 'excise duty' even in absence of Section
11D of the CEA, 1944, in terms of the Apex Court ruli ngs in Sahakari Khand Udyog &
Chengalvaraya Naidu cases - Lower authority to verify the deposit particulars and
evidence and pass appropriate order on this limited issue only - assessee succeeds in
respect of (iv) since revision of cost has no significance when it is supplied by buyer to
the assessee not being liable to duty because its finished goods are ultimately
exempted which remained undisputed by Revenue. [Para 8, 9, 10]
2015-TIOL-1538-CESTAT-AHM
Adani Gas Ltd Vs CCE & ST (Dated: June 17, 2015)
CX - Application filed by assessee for early hearing of appeal and submitting that issue
is covered by decision in Bharat Petroleum Corporation Ltd 2014-TIOL-1114-CESTATMUM - Application allowed: CESTAT
2015-TIOL-1532-CESTAT-AHM
Harish Dyeing And Printing Works Vs CCE & ST (Dated: December 30, 2014)
CX - Assessee engaged in processing of Man Made fabrics from grey fabrics and
availed Cenvat credit on the basis of invoices issued by certain suppliers of grey
fabrics - They are eligible to avail credit on the basis of said invoices as per Rule 7 of
CCR as it stood at relevant period - Supplier of grey fabrics who issued invoices are
not traceable and /or non-existent - Commissioner (A) has clearly observed that
assessee is not the part to fraud committed by grey fabric suppliers - Demand of
inadmissible CENVAT credit is clearly barred by limitation and is not sustainable and
penalty is also not imposable - Appeal allowed: CESTAT
2015-TIOL-1531-CESTAT-AHM
Bright Engineering Works Vs CCE & ST (Dated: June 15, 2015)
CX - CENVAT Credit was disallowed by Adjudicating authority on the ground that
assessee had availed CENVAT Credit on strength of invoices of service provider who
had provided Manpower Recruitment Services to assessee, bearing hand written serial
numbers - Adjudicating authority passed impugned order, following the decision of
Andhra Pradesh High Court and CBEC Supplementary Instructions - Andhra Pradesh
High Court, after considering various aspects of interpretation of statute, observed
that pre -printed of invoices are required - Hence, assessee failed to make out a prima
facie case for waiver of pre -deposit of entire amount of duty along with interest and
penalty - Assessee is directed to make a pre -deposit of Rs.12,00,000.00: CESTAT
2015-TIOL-1530-CESTAT-DEL
Care And Cure Pvt Ltd Vs CCE (Dated: June 18, 2015)
ST - Assessee had been providing taxable services since September, 2005 but had
neither taken registration nor filed any returns - Service was provided under an
agreement with M/s Hindustan Lever Ltd. which clearly brings out nature of service
and there was no scope for any ambiguity or doubt about taxability thereof Allegation of suppression on part of assessee is clearly sustainable warranting
imposition of mandatory penalty under Section 78 ibid - Penalty under Section 76 ibid,
is set aside - Penalty under Section 78 is upheld but assessee is given an option to
pay penalty equal to 25% thereof: CESTAT
2015-TIOL-1529-CESTAT-AHM
Shree Chalthan Vibhag Khand Udyog Sahakari Mandli Ltd Vs CCE & ST (Dated:
June 22, 2015)
CX - Whether 5% amount under Rule 6 of CCR, 2004 is required to be paid by
assessee on Bagasse cleared by them at Nil rate of duty when CENVAT credit is taken
on inputs - Sugarcane is pushed into a cane crushing mill to get Bagasse waste and
sugarcane raw juice - It has not been brought on record as to what inputs, on which
credit is taken, is used during process of crushing sugarcane into waste - Credit on
chemicals is taken for converting sugarcane raw juice to commercial sugar or
molasses which are cleared on payment of duty - As per Indian Potash Limited 2012TIOL-1402-CESTAT-DEL , in absence of any evidence on record, to show credit taken
inputs used in making of Bagasse, appeal filed by assessee is allowed: CESTAT
2015-TIOL-1526-CESTAT-MAD
C E Kim Vs CCE (Dated: March 5, 2015)
Central Excise - Demand - Appellant, manufacturer of 'conveyor belts', applied for
registration, cleared goods, passed on the incidence and collected duty from
downstream - same not deposited to Government account until detected by the
department; when the dues were discharged with interest - demands confirmed with
penalties under Sec 11AC of the CEA and Rule 26 of CER 2002 on the firm; partly
modified by Commissioner (Appeals) and individual; agitated herein.
Held: Department has not come out with clear e vidence to show malafides of the
appellants or their contumacious conduct to establish evasion - Section 11AC of
Central Excise Act, 1944, has two essential ingredients - First ingredient is "intention"
and the second one is "evasion" - Records nowhere exhibits the intention of the
appellants to defraud Revenue with a view to cause evasion or deliberately
suppressed facts - No doubt, awaiting registration, appellant made first clearance but
realized duty; nothing on record to show habitual conduct of evasion not being
discovered by any direct or circumstantial evidence - Intention of the appellant does
not appear to be evasive; therefore, presumption of ill intention to cause evasion is
impermissible on the facts and circumstances of the case and there shall not be
penalty on both the appellants [Para 5, 6]
2015-TIOL-1525-CESTAT-DEL
M/s Kamakhya Steels Pvt Ltd Vs CCE (Dated: March 13, 2015)
Central Excise - Annual Capacity of production - appellant, manufacturer of MS Ingots,
opted for compounded levy scheme of Rule 96 ZO (3) of Central Excise Rules, 1944;
later sought redetermination of ACP under Section 3A (4) - Revenue viewed that since
they had op ted for compounded levy scheme in April 1998 and had not withdrawn
their option, they would be liable to pay duty under compounded levy scheme demands adjudicated with interest and penalty under Rule 97ZO(3), modified by the
Tribunal, agitated before Allahabad HC both by the appellant and the department,
who remanded the case to the Tribunal for denovo consideration.
Held: Departmental officers came to know about short payment in course of scrutiny
of the RT -12 returns for the relevant period; clear that the fact of payment of duty on
actual production basis during the period from December 1999 to March 2000 had
been disclosed by the appellant in their RT-12 returns - Department's plea that short
payment was deliberate with malafide intention is incorrect - the penalty in this case
equal to the duty demand confirmed has been imposed under the proviso to Rule 96
ZO (3), but this penal provision has been held to be unconstitutional by the judgment
of Punjab & Haryana High Court in the case of Bansal Alloys and Metals - no infirmity
in Tribunal's order reducing the penalty [Para 6]
2015-TIOL-1520-CESTAT-AHM
M/s Dhakad Metal Corporation Vs CCE & ST (Dated: June 16, 2015)
CENVAT - It is beyond comprehension that a man will get invoices without inputs and
separately acquire inputs clandestinely from other sources to manufacture his goods There is no evidence on record that appellant did not re ceive the inputs alongwith
cenvatable invoices issued by the dealer - Credit correctly availed - Penalty cannot be
imposed on registered dealer u/r 15 of CCR as it has not been shown that they have
taken any credit wrongly - Appeals allowed: CESTAT [para 6, 7]
Also see analysis of the order
2015-TIOL-1519-CESTAT-DEL
CCE Vs M/s Kothari Products Ltd (Dated: March 17, 2015)
CX - In earlier round of litigation, Tribunal has remanded the case to adjudicating
authority for deciding the issue afresh after observing principles of natural justice - It
is the grievance of Revenue that while deciding issue, Commissioner has travelled
beyond scope of remand order and considered the submission of assessee about
admissibility of CENVAT Credit availed without due verification of facts, when SCN
about eligibility of such CENVAT Credit are pending adjudication - It is difficult to
accept contention of Revenue that Commissioner cannot adjudicate admissibility of
CENVAT Credit or otherwise, while considering forfeiture of all irregular payment in
ESCROW account or connected issues - It is necessary that Commissioner should take
into consideration pending SCN before allowing CENVAT Credit to assessee and record
a detailed finding on this issue - Impugned order is set aside to the extent of allowing
CENVAT Credit and matter is remanded to adjudicating authority: CESTAT [Para 8]
2015-TIOL-1518-CESTAT-DEL
M/s Gulshan Chemicals Ltd Vs CCE (Dated: February 27, 2015)
CE/ST - Service Tax on inward GTA services paid on the whole value of the services
availed instead of 25% as per notification no. 32/2004 - claim filed for refund of the
excess Service Tax paid on transportation services i.e. 75% during the period
01.01.2005 - 31.05.2007 on 15.06.2007 - adjudicating authority holding that the
appellant has passed the bar of unjust enrichment but the claim is time barred refund sanctioned of Rs.7,94,490/- but rejected for an amount of Rs.8,26,637/ - appeal filed by appellant rejected by Commissioner(A) - the Commissioner has also
reviewed the order of the adjudicating authority after disposal of appeal by
Commissioner(A) - appellant is before CESTAT.
Held: Commissioner cannot pass order in revision u/s 84 of the FA, 1994 when the
issue of the appeal decided by the Commissioner (A) is on entirely a different issue order passed by the Commissioner in review is not sustainable in the eyes of the law On merits also the Commissioner (A) has ignored to consider the fact that the
Adjudicating Authority has considered that amount of service tax paid by the appellant
is shown receivable from the excise department - refund claim of Rs.7,94,490/- is
allowed - So also, as per notification no. 32/2004 the appellant was not required to
pay Service Tax at all - when there is no liability for the appellant to pay Service Tax
the provision of section 11(B) of the Act are not applicable - bar of limitation is not
applicable - appellant is entitled to refund claim of Rs.8,26,637/- - Appeals allowed
with consequential relief: CESTAT [para 8, 9, 10]
2015-TIOL-1517-CESTAT-DEL
M/s Hindalco Industries Ltd Vs CCE & ST (Dated: May 18, 2015)
CENVAT – Department alleges that the Supplementary Invoices against which
appellant took credit of the Service Tax paid by service providers are not proper
documents & appellant is not entitled to CENVAT credit in view of Rule 9(1)(bb) of
CCR, 2004 inasmuch the service providers had evaded service tax and later paid the
same – demand confirmed along with interest and equivalent penalty - appeal to
CESTAT.
Held: When the department alleges that this service tax had been paid by the service
providers under supplementary invoices and those supplementary invoices had been
issued for the service tax which had earlier been evaded by them and was paid on the
service tax evasion being detected, the burden would be on the department to
produce evidence in this regard - However, it is seen that neither the SCN while
making this allegation, gives details of the SCNs issued to the service providers and of
the adjudication order confirming service tax demands under proviso to section 73 (1)
against them nor such documents had been provided to the appellant - appellant have
made inquiries with certain service providers which have been placed on record which
indicate to the contrary - appellant has strong prima facie case in their favour – Pre deposit waived and stay granted: CESTAT [para 7, 8]
2015-TIOL-1516-CESTAT-DEL
M/s Reliance Chemotex Industries Ltd Vs CCE (Dated: June 11, 2015)
Refund - CENVAT - Rule 5 of CCR, 2004 - Non-production of customs certified copies
of shipping bills alongwith the refund application is only a remediable defect for which
the refund claim cannot be denied when subsequently the customs certified copies of
shipping bills were produced - when refund claim has been filed in respect of the 70
consignments cleared for export during July 2007 - September 2007, within the
prescribed limitation period, and by the time the refund claim was filed, the goods had
already been exported out of India, refund in respect of 11 consignments cannot be
denied just because the same were physically exported in October 2007 - A
substantive claim cannot be denied for a minor procedural violation - Appeal allowed
with consequential relief: CESTAT [para 5, 6]
2015-TIOL-1500-CESTAT-BANG
M/s Methods (India) Pvt Ltd Vs CCE, C & ST (Dated: January 30, 2015)
Central Excise - Courier services used to make correspondence with vendors, clients
and Tour operator services to move employees to and from work place are integrally
connected with business activity of assessee as such are Cenvatable input services Cenvat credit is admissible - Denial is improper - Impugned order set aside - Appeal
allowed with consequential relief. (Para 4)
2015-TIOL-1498-CESTAT-DEL
CCE & ST Vs M/s Amrit Soap Company (Dated: April 22, 2015)
CX - Goods found in excess and raw material found short at time of investigation Allegation of procurement of raw material clandestinely and manufacturing thereof
and clearance of finished goods without payment of duty - Goods were found excess
were not in complete finished condition as these goods were not packed and could not
be entered in statutory records - Said fact has not been examined at time of
investigation - Defence taken by assessee is a cceptable in absence of corroborative
evidence - Therefore, proposal of confiscation of goods is set aside - Consequently,
penalty and redemption fine are not imposable on assessee - No efforts were made by
revenue to reveal the truth by examining manufacturing process to ascertain raw
material consumed and resulted output - Charge of clandestinely removal of goods is
also not sustainable against assessee in absence of any contrary evidence against
assessee - No infirmity in impugned order, same is upheld - Appeal dismissed:
CESTAT
2015-TIOL-1497-CESTAT-DEL
Inder Rubber Industries Vs CCE (Dated: April 9, 2015)
CX - SSI Exemption - Both assessees were using brand name belonging to other
persons - Goods being manufactured by brand name owners were different from
goods being manufactured by assessees on which these brand names were being used
- As per Ace Auto Comp. Ltd. 2010-TIOL-112-SC-CX, benefit of SSI exemption would
not be available - As regards to period of limitation, during period of dispute, there
were a series of judgments, wherein it was held that use by an assessee of brand
name belonging to another person would not result in denial of SSI exemption, if
goods being manufactured by assessee are different from goods being manufactured
by brand name owner and in respect of which brand name is registered - There was
scope for doubt in mind of assessee regarding availability of SSI exemption and
hence, in view of Apex Court judgement in Continental Foundation Joint Venture
2007-TIOL-152-SC-CX, longer limitation period of 5 years would not be available and
for same reason, there would be no justification for imposition of penalty on assessee
under Section 11 AC of CEA, 1944: CESTAT [Para 7, 8]
2015-TIOL-1495-CESTAT-DEL
M/s Hero Honda Motors Ltd Vs CCE (Dated: May 18, 2015)
CX - AV - s.4 of CEA, 1944 - Dealers request the appellant to organize the
advertisement of the products in their area and in such cases about 40% of the
expenses incurred on advertisement are recovered by a ppellant from dealers - no
cause for adding this expense in AV - Appeal allowed: CESTAT
Also see analysis of the order
2015-TIOL-1493-CESTAT-DEL
Dewas Fabrics Ltd Vs CCE & ST (Dated: February 24, 2015)
CX - Assessee's company and its Directors, filed appeal against impugned order in
November, 2005 - When factory was closed since November, 2004, Tribunal failed to
understand as to why in column in Memorandum of appeal for "address for
communication", it is address of factory which was given and not any other address
where as sessee company had its office - Though assessee's Counsel withdrew his
appearance sometime in January, 2014, thus, since, January, 2014, other than the
factory address of assessee, there was no address to which any directions to them
regarding date of hearing could be communicated - If assessee were really serious in
pursuing appeal they should have given some other address for communication at
which they would be available and not the address of factory which was closed since
one year prior to filing of appeal - Assessee has not cooperated at all with Tribunal in
this regard - Appeal dismissed: CESTAT [Para 7]
2015-TIOL-1490-CESTAT-MAD
Arr Sales Agency Vs CCE (Dated: May 01, 2015)
Central Excise - Refund - Appellant, manufacturer of scented supari, filed a claim for
refund of excise duty; rejected in adjudication but allowed by Commissioner (Appeals)
- Revenue agitated the OIA before Tribunal, who set aside the OIA and allowed
Revenue's appeal; matter agitated before High Court, who dismissed the appeal Meanwhile the original authority sanctioned refund in terms of Commissioner
(Appeals) order and immediately issued demand for recovery of erroneous refund,
which was adjudicated after the Tribunal order, confirming demand for recovery with
interest - same upheld by Commissioner (Appeals) and agitated hereunder in the
second round of litigation.
Held: The present appeal is an offshoot of refund claim which was originally rejected
by the adjudicating authority in his order dt. 30.5.2001 on limitation which is upheld
by Tribunal in Final order dt.29.7.2005 and Hon'ble High Court - hence the demand of
recovery of erroneous refund with interest; and accordingly the impugned order is
upheld [Para 5]
2015-TIOL-1489-CESTAT-MAD
Blue Mount Textiles Vs CCE & ST (Dated: May 11, 2015)
CX - Stay / dispensation of pre deposit - CENVAT credit - Transfer of credit - M/s BMT
& M/s GM (100% EOU), both owned by M/s STPL - M/s GM merged with M/s STPL,
and subsequently, credit pertaining to M/s GM was transferred; same disallowed in
adjudication, upheld by Commissioner (Appeals) and agitated herein.
Held: Appellant at every stage intimated the department and also sought for single
registration under Rule 10, with an undertaking binding themselves to all assets and
liabilities of other companies - The department has not caused verification in spite of
appellant submitting the documents furnished in Dec'2014 - Prima facie , appellants
have made out a case for total waiver of predeposit. [Para 4]
2015-TIOL-1488-CESTAT-DEL
M/s Achiever International Vs CCE (Dated: February 03, 2015)
CX - During course of search, goods such as CFLs of Leuci Japan brand, Hquaquiang,
SKN, Hans and Jewels were found - Assessee failed to produce invoices for
procurement of goods - As goods are branded therefore, both lower authorities have
correctly drawn conclusion that goods are procured by assessee without payment of
duty - Goods are liable for confiscation - Considering quantum and value of goods,
redemption fine imposed on assessee is absolutely correct - No merit in appeal,
hence, same is dismissed: CESTAT
2015-TIOL-1487-CESTAT-MUM
M/s Desmet Ballestra India Ltd Vs CC (Dated: May 12, 2015)
Cus - Refund - Department returning refund applications filed by appellant only on the
ground that against the very same Bills of entry another person has filed a refund
claim, which has been rejected - It is observed that the appellant was claiming the
amount as refund on the ground that they have borne the incidence of duty - this
assertion seems to have been overlooked by the adjudicating authority - the least he
could have done is to consider the appellant's case on merits and passed a speaking
order - since the issue involved needs to be factually verified from the records matter
remanded to adjudicating authority for reconsideration of the refund application
afresh: CESTAT [para 5, 6]
2015-TIOL-1486-CESTAT-MAD
M/s Jansons Clothing Vs CCE (Dated: April 8, 2015)
CX - Exemption - Raw material procured duty free from DTA allowed to be cleared for
further processing by exporter subject to condition that proof of export be furnished in
terms of Notification No. 43/2001 dated 26.6.2001 - Exemption sought to be denied
on the ground that the appellant himself did not effect the export clearance; and
agitated herein.
Held: Controversy in this appeal is reduced to the point as to whether notification has
to be interpreted to mean that export has to be made by the appellant only or the
goods are to be exported - The spirit of the notification being to expo rt the goods
manufactured using duty free raw material irrespective of the person who exported
the same there should not be controversy to bring the appellant to the jaws of the
levy - furthermore, appellant was granted permission for clearing the duty free raw
material for use in export of the finished goods supported by proof of export [Para 3]
2015-TIOL-1483-CESTAT-MUM
M/s Leben Laboratories Pvt Ltd Vs CCE (Dated: March 30, 2015)
CX - Assessee had sought permission from Commissioner to store finished goods
manufactured by them outside factory premises without payment of duty on the
ground of shortage of space - Such permission was granted to assessee and was
renewed regularly - By a letter dated 10.12.2014, assessee again sought
extension/renewal of permission to store goods in a warehouse outside the factory Said letter of assessee seeking extension was rejected by Commissioner of Central
Excise, vide letter dated 26.12.2014 - If both the field formations i.e. Range
Superintendent as well as Jurisdictional Division Office recommend the case of
assessee as has been genuine one, it should have been considered in correct
perspective by office of Commissioner of Central Excise - On perusal of letter dated
26.12.2014 vide which Commissioner has not granted extension of permission to
store the goods without payment of duty, is a very casually worded and does not
given any reason for rejection of request - As per Balkrishna Industries Ltd. - 2011TIOL-2036-CESTAT-DEL impugned order is set aside and matter remanded: CESTAT
2015-TIOL-1480-CESTAT-AHM
CCE & ST Vs M/s Ankit Textiles (Dated: June 18, 2015)
CX - ROM application filed by Revenue on the ground that Chief Commissioner, CE
Vadodara was properly nominated by order dated 30.10.2006 of CBEC for purpose of
review of O-I-O passed by CCE, Ahmedabad Zone - Order dated 30.10.2006 issued by
CBEC, Ministry of Finance is not found enclosed with ROM application and was also not
produced during course of hearing when order dated 24.10.2014 was passed - As per
order dated 24.10.2014, appeals were dismissed for a proper authorisation not only
on the ground that appropriate order/ notification from appropriate authority,
authorising Chief Commissioner to sign review order, was not existing but also
dismissed, on other procedural requirements on basis of cases decided by coordinate
benches - As ground raised now were not existing/raised at time of 'lending the main
appeal, therefore, it can not be said that there was any mistake apparent on face of
records - ROM application rejected: CESTAT
2015-TIOL-1478-CESTAT-MAD
M/s Talent Steel Industries Pvt Ltd Vs CCE (Dated: April 30, 2015)
CX - Exemption - appellant was manufacturer of bars and rods using ingots received
from its job worker who in turn cleared goods duty free under notification No.7/97-CE
dated 01.03.1997 - Revenue's only allegation is that since the ingots cleared by job
worker not suffering duty, appellant is disentitled to benefit of notification No. 7/97 CE dated 01.02.97 - agitated herein.
Held: In view of the settled position of law that duty shall be collected on ingots
manufactured by job worker, that concern is liable to duty; appeal by principal
manufacturer allowed - appeal by job worker is remanded to adjudicating authority on
the very limited issue granting fair opportunity of hearing to the appellant to
determine its liability if any in accordance with law, considering its submissions both
on facts and law and shall pass a reasoned and speaking order [Para 4, 6].
2015-TIOL-1477-CESTAT-DEL
M/s Kisco Castings India Ltd Vs CCE & ST (Dated: April 27, 2015)
CX - SCN was issued to assessee on the basis that invoices issued by M/s. Jyoti Steels
are only paper transactions and no goods have been received by assessee - No
investigation has been conducted by Revenue at the end of manufacturer supplier
against whose invoices assessee has taken Cenvat Credit - No Investigation was
conducted from transporters to ascertain the fact whether goods have been
transported to assessee's factory or not - Assessee is able to produce invoice against
which they had availed Cenvat Credit and same has been entered in their RG-23
Register - Therefore, burden casts on revenue to prove that this is only a paper
transaction and goods have not been received by assessee at all but revenue failed to
do so - Impugned order is set aside and appeal allowed: CESTAT [Para 6, 7, 8, 9, 10]
2015-TIOL-1476-CESTAT-DEL
M/s MPK Products Pvt Ltd Vs CCE (Dated: December 24, 2014)
Central Excise - ACP based assessment under Sec 3A of the CEA 1944 - appellants are
manufacturer of re-rolled products; proposals for duty demand by fixing annual
capacity of production under Rule 96ZQ of the erstwhile Central Excise Rules
adjudicated, ACP finalized, subsequently refixed on remand by Commissioner
(Appeals) in the first round of litigation - de novo fixation of ACP upheld by
Commissioner (Appeals) and agitated herein.
Held: The issue whether the proceedings against the appellant can be continued under
Rule 96 ZQ of the erstwhile Rules after 1.3.2001 or not has been dealt with in Alwar
Processors case wherein the Tribunal held that in the absence of a saving clause,
proceedings initiated prior to 01.03.2001 would lapse - following the same,
proceedings against the appellant post 01.03.2001 not sustainable, impugned orders
set aside. [Para 6, 7]
2015-TIOL-1473-CESTAT-AHM
M/s NHH Textile Processors Vs CCE & ST (Dated: April 30, 2015)
CX - Fabrics are received by assessee and after undertaking processes of Chemiking
and Spotting, goods are sent back to M. H. Mills and subject to further dyeing Adjudicating authority views that the two stages of washing and dyeing, involved in
process of processing of fabrics, cannot be viewed separately - Assessee is only
undertaking process of Chemiking and Spotting which is akin to process of washing
and cannot be considered to have brought a new marketable product into existence
which is brought and sold in market - Eve ry process undertaken on fabrics will not go
into category of 'any other process' as mentioned in Note 2 of Chapter 52 of CETA,
1985 - Processes of Chemiking and Sporting undertaken by assessee does not amount
to manufacture and accordingly, appeal filed by assessee is allowed: CESTAT
2015-TIOL-1472-CESTAT-MUM
M/s Sulzer India Pvt Ltd Vs CCE (Dated: May 28 , 2015)
CX - Storage of goods outside factory premises - department has no locus standi to
insist upon the assessee for expansion of factory space - If this contention is accepted
then it applies to each and every industry and the provision of Rule 4(4) of CER, 2002
will become redundant - Permission granted - Appeal allowed: CESTAT [para 6]
Also see analysis of the order
2015-TIOL-1468-CESTAT-DEL
Industrial Thermopack Vs CCE (Dated: March 20, 2015)
CX - Accounts books were not found maintained properly by assessee - It was alleged
that raw material and finished goods found in their factory unaccounted are meant for
clandestine removal of goods - No corroborative evidence has been produced by
revenue to establish the intent of assessee to remove goods clandestinely - Provisions
of Rule 25 of CER, 2002 have not been complied with - Therefore, goods are not liable
for confiscation - Consequently, redemption fine and penalty is not imposable on
assessee and penalty on Shri Harish Kumar Sharma is also not imposable under Rule
26 of CER, 2002: CESTAT [Para 7, 8, 9]
2015-TIOL-1467-CESTAT-DEL
Philips Electronic India Ltd Vs CCE (Dated: June 17, 2015)
CX - Main assessee, PEIL and earlier named Philips India Ltd. (PIL) was earlier owned
by M/s. Punjab Anand Lamp Industries Limited (referred to as PALI) - Other assessee
-M/s. Philips Electronics NV Netherlands ( Philips Netherlands) is holding company of
PEIL - PEIL in addition to manufacturing lamps, tube lights, electronic products and
electrical appliances, were also purchasing lamps from various other parties for sale
under brand name-Philips - During period of dispute, about 97 to 98 per cent of
production of PALI was being sold to PIL and balance 2 to 3 per cent of sale was to
M/s. Bajaj Electricals Limited - Department alleged that PALI and PIL are related
persons - Since neither there is allegation of department that M/s. Bajaj Electricals
Limited were a lso related person of PALI within meaning of this term as defined in
section 4 (4) (c) nor there is any evidence on record that PIL and Bajaj Electricals Ltd
are related persons, the sales of PALI to Bajaj Electricals Limited have to be
considered as sales to independent buyers - When an assessee has sales on regular
basis to independent buyers it cannot be said that assessee has so arranged that
goods manufactured by him are generally sold by him to or through a related person
and in this regard, quantum of sales to independent buyers is not relevant - It cannot
be said that PALI, in respect of their sales to PIL have not paid duty on normal price When undisputedly 2 to 3 per cent of sales of PALI were to Bajaj Electricals Limited
and neither the genuineness of these transactions is disputed by department nor the
department has alleged that PALI and Bajaj Electricals Limited were related person
within meaning of this term as defined in section 4 (4) (c), department cannot invoke
3rd proviso to section 4 (1) (a) and charge duty in respect of sales of PALI to PIL at
sale price of PIL to its dealers - Appeals allowed: CESTAT
2015-TIOL-1466-CESTAT-MAD
CCE Vs Lucas TVS LTD (Dated: May 20, 2015)
Central Excise - CENVAT credit - Revenue agitating Commissioner (Appeals) order
holding certain input services admissible to credit.
Held: Manpower supply to canteen is within scope of integrated activity of the factory,
with canteen itself being an obligation under the Factories Act - pest control being an
essentiality to preserve the record for carrying on the business, disallowance of credit
improper - Commissioner (Appeals) rightly held both input services adm issible.
2015-TIOL-1464-CESTAT-MUM
Dr Writer's Food Products Pvt Ltd Vs CCE (Dated: April 10, 2015)
CE - Duty on samples of chocolates drawn for quality control and infestation – Only
for the sake of absence of the record for date of destruction of the sample, without
there being any finding as to clearance or sale of any sample products by the
assessee, no a dverse inference can be drawn based on presumptions and assumptions
– Duty Demand set aside & appeal allowed: CESTAT [para 7]
Also see analysis of the order
2015-TIOL-1460-CESTAT-DEL
M/s Kl Concast Pvt Ltd Vs CCE & ST (Dated: April 15, 2015)
CX - Cenvat Credit on steel items namely HR sheet, MS Bar and Round, TMT bars,
Shapes and Sections, Mould Tubes, Iron And Steel Bars and Aluminum Bars - As per
certificate produced by Charted Engineer, except items iron and steel bars all other
items are used for either fabrication of capital goods or part of capital goods or used
as input by assessee in manufacturing of final product - Revenue has not produced
any contrary evidence to report of Charted Engineer - Except for iron and steel bars,
Cenvat Credit is allowed to assessee as usage of iron and steel bars have not been
discussed by Charted Engineer in his report - Assessee has also contested issue of
limitation on the ground that SCN has been issued on 24.02.2012 for period 2007 -08
to 2011 -12 - As per Vandana Global 2010-TIOL-624-CESTAT-DEL-LB, for the
period prior to 30.04.2010 extended period of limitation is not invokable - Appeal
allowed: CESTAT
2015-TIOL-1459-CESTAT-DEL
CCE Vs M/s Kml Molding (Dated: February 26, 2015)
CX - Assessee constructed factory shed in their factory premises and paid ST on civil
construction services and availed cenvat credit of ST paid thereof - As per Rule 2(1) of
CCR, 2004, for setting up, modernization, renovation or repair of factory, Cenvat
credit is entitled for input service - Assessee is entitled to take Cenvat Credit on said
services - No infirmity found in impugned order, same is upheld - Revenue's appeal
dismissed: CESTAT [Para 5, 6]
2015-TIOL-1456-CESTAT-BANG
Kluber Lubrication India Pvt Ltd Vs CCE, C & ST (Dated: January 21, 2015)
Central Excise - Waiver of deposit - Value of unutilized raw materials/packing
materials written-off prior to 01.03.2013 - Not recoverable for want of recovery
mechanism incorporated under Rule 3 of the Cenvat Credit Rules, 2004 - Invocation of
extended period of limitation on ground of suppression of material facts, not justified Good prima-facie case made out by appellant - Pre -deposit is waived. (Para 3)
2015-TIOL-1454-CESTAT-MUM
M/s Vipras Castings Ltd Vs CCE (Dated: June 16, 2015)
CX - Fraudulent CENVAT credit - so long as admittedly material shown in the invoices
were not received by the appellant, credit of such invoices cannot be allowed to the
appellant - Ship breaking scrap cannot be used for melting purpose and, therefore,
the scrap which was used by the Appellant would undoubtedly be scavenger scrap fact that supplier is absconding reinforces the charges of fraudulent passing of the
Cenvat credit and availment thereof by the appellant - Conduct of the appellant
clearly shows that they are in collusion with dealer for availment of the fraudulent
Cenvat Credit - Demand upheld with penalty u/s 11AC of CEA, 1944 - if the penalty
under Section 11AC which is equal to the Cenvat amount has been imposed, separate
penalty of similar a mount imposed under Rule 13(1) of Cenvat Credit Rules, 2002 was
not warranted: CESTAT [para 6]
Penalty of Rs. 1,29,51,948/ - is imposed under Rule 13(1) towards confiscation of the
3826.790 MT on which fraudulent Cenvat credit was availed - First of all, the case of
the Revenue is that that Cenvat Credit to the appellant is not admissible on the
ground that they have not received the input - Secondly no goods were seized and,
therefore, confiscation of the goods not available for seizure cannot be made - Penalty
of Rs.1,29,51,948/ - under Rule 13(1) (correct Rule 15(1)) of Cenvat Credit Rules,
2002 was wrongly imposed: CESTAT [para 6]
Penalty - Since it has been conclusively established that appellant have fraudulently
availed Cenvat Credit by showing bogus pu rchase, it is impossible that the Managing
Director of the appellant company who looks after overall affairs of the company is not
involved in the entire modus operandi - Penalty imposed on the Director is also
maintained : CESTAT [para 6]
also See analysis of the order
2015-TIOL-1452-CESTAT-BANG
Kolisetty Alloy Castings Vs CC, CE & ST (Dated: March 2, 2015)
Central Excise - Default in payment of duty liability - Wrong availment of Cenvat
credit - Held on facts, that portion of Sub rule (3A) based on which Order-in-Original
has been passed and under challenge, declared as ultra vires by the High Court Question of continuance of proceedings based on Sub Rule struck down does not arise
- Impugned orders set aside - Appeal allowed by way of remand to the Commissioner
(A) to decide appeal on merits without insisting for pre-deposit. (Para 4)
2015-TIOL-1451-CESTAT-MAD
M/s Jain Irrigation Systems Ltd Vs CCE (Dated: March 10, 2015)
Central Excise – Exemption - Appellant supplied the goods in question for use in
Drinking water supply project as notified by Govt. of India vide Customs Notification
No. 42/96 dated 23.07.96 in term s of clause (6) of CTH 9801 – Revenue viewed the
same inadmissible; adjudicated demands, agitated herein.
Held: Appellant's contention that the goods were meant for drinking water supply
project is not doubted from documents submitted - goods cleared were factually used
in Drinking water supply project, which is a notified project under clause (6) of CTH
9801 - Reference to CTH 9801 finds place in notification No. 6/06-CE dated 01.03.06
as well as notification No. 12/11-CE dt. 07.03.12 - Reading of the customs
notification, tariff heading, nature of goods cleared and central excise notifications
enables to hold that the goods cleared by appellant were meant for Drinking water
supply project only; and the goods so used was certified by the appropriate authority
- in absence of any contrary evidence, the goods cleared by appellant cannot be
denied exemption. [Para 4]
2015-TIOL-1446-CESTAT-MUM
M/s Kapilansh Dhatu Udyog Pvt Ltd Vs CCE (Dated: February 27, 2015)
CX - Appellant supplied goods without payment of duty to SEZ unit in terms of Section
2(m) of SEZ Act, 2005 - Goods supplied to SEZ is clearly treated as export - Even
though in Rule 6 of C CR, 2004, amendment in respect of supplies made to SEZ was
made on 31/12/2008 but since supply were already in nature of export only,
clearances were entitled for all benefits provided in respect of export of goods - As per
Steel Authority of India Ltd. - 2013-TIOL-384-HC -CHATTISGARH-CX , appellant is not
required to pay 10% in terms of Rule 6(3)(b) - amendment under Rule 6(6)(i) made
on 31.12.2008 is clarificatory in nature and is applicable retrospective from the date
when the 2004 Rules were implemented - Impugned order is not sustainable, hence
same is set aside and appeal allowed: CESTAT [Para 5]
2015-TIOL-1445-CESTAT-DEL
M/s Golden Tobacco Ltd Vs CCE (Dated: December 1, 2014)
CX - Commissioner has confirmed duties against M/s Golden Tobacco Ltd. and M/s. M
P Tobacco Ltd. 'jointly and severally' - Tribunal in same appellants case vide earlier
orders have held that such confirmation of demands or imposition of penalties jointly
and severally are not in accordance with law and matters stand remanded to
Commissioner for fresh decision, after making his mind as to who is actual
manufacturer of cigarettes in question - Said directions does not stand complied with
by adjudicating authority - Adjudicating authority is directed to follow instructions as
contained in said Final Order of Tribunal, during course of denovo proceedings - Only
persons to gain from such avoidable delay in adjudication of this matter are M/s GTC
Industries Ltd. and M/s MP Tobacco Ltd. against whom duty demand may be
confirmed, as interest liability under Section 11AA of person held to be liable to pay
duty would start only on expiry of three months from date of adjudication order Registry is directed to endorse a copy of this order to Chairman, CBEC for his
information: CESTAT
2015-TIOL-1444-CESTAT-AHM
Krishna Barrels Pvt Ltd Vs CCE & CC (Dated: February 10, 2015)
CX - Assessee availed Cenvat Credit of Rs. 18,035.00/- on rejected raw materials
which cannot be used in or in relation to manufacture of final products - Assessee
reversed credit during investigation - As regrds to demand of duty of Rs. 4,61,071/-,
it is a fact that rejected material was undertaken process by assessee on which they
availed credit under Rule 16 of CER - Assessee cleared goods after process - Decision
of Division Bench of Tribunal in case of Apollo Tyres Ltd . 2010-TIOL-549-CESTAT MUM would apply for hearing, wherein it is held that expression "for any other reason"
in Rule, 16 (2) of Rules, 2002 have wide amplitude - As regards to demand of Cenvat
Credit of Rs. 56,481.00/ - on outward freight charges, assessee contends that due to
misunderstanding of law, they reversed credit before issues of SCN - Cenvat Credit is
admissible on outward transport to Customers premises - When issue is settled in
favour of assessee that they are not liable pay duty, then, demand cannot be
sustained merely, on grounds, that they have not contested the issues on merit, as
Tribunal is final fact finding authority - Demand of duty of Rs. 18,035.00/- alongwith
interest is upheld and demand of duty in respect of other issues and penalty are set
aside: CESTAT [Para 4, 5, 6, 7, 8]
2015-TIOL-1442-CESTAT-DEL
M/s Ankit Exim Pvt Ltd Vs CCE (Dated: February 09, 2015)
CX - ROA - Matters were listed for final hearing on 22.01.2014 - According to
assessee's Counsel, matter was called at around 4 P.M. in afternoon and at that time,
since he had to go somewhere fo r some personal work, he had instructed his clerk to
seek adjournment, as brief of this matter had been received by him only a day before
and he was not prepared to argue this matter - Genuine reasons for non-appearance
of assessee - After going through said order, it is clear that not only order is ex parte
order passed without hearing assessee, even merits of case are not discussed at all Since this is a non-speaking order passed ex parte, it deemed fit to recall this order:
CESTAT
2015-TIOL-1440-CESTAT-MAD
Shri A Thangavel Vs CCE (Dated: March 24, 2015)
Central Excise - Refund under Rule 5 of CCR 2004 - applicant is a manufacturer of
fabrics clearing goods to the garment manufacturers under Notification No. 43/2001CE (NT) dated 26.06.2001 as amended - claim rejected in adjudication on the ground
that the appellant has not submitted the proof of documents of exports from the
claimant's premises and also they have not produced sufficient evidence for the same
- same upheld by Commissioner (Appeals) and agitated herein.
Held: Both the authorities below have rejected the refund claim on the grounds that
they are not the actual exporters and also they failed to produce the documents as
per the notification No. 11/2002 - no dispute on the fact that the garment exporters
are duly registered with the department and executed necessary bond and followed
the procedure prescribed under the said notification; annexure-I issued by the
garment manufacturer is duly certified by the jurisdictional Asst. Commissioner for
procurement of fabrics from the appellant without payment of excise duty - goods
were supplied to the garment manufacturer under the above notification for use in the
manufacture and export of final products; clearance of the goods under the said
notification by the appellants is ultimately meant for export - for claiming refund
under Rule 5 read with Notification No.11/2002 in para-4 - Condition No.4 of the
notification not applicable to the appellant as they have not exported directly but
cleared duty free to the garment manufacturer by following the conditions under
notification No. 43/2001 and also by following Central Excise (Removal of goods at
concessional rate of duty for manufacture of excisable goods) Rules, 2001 and the
garment exporter ultimately exported the goods [Para 5]
Identical issue has been decided in the case of SVM Textile Mills, Jain Textiles
Industries and Pioneer Processing wherein refund was allowed - Tribunal consistently
held that that even though the appellant is not an exporter but the goods were
cleared under the notification No. 43/2001, which is intended for manufacture of
garments and for export out of India, they are eligible for refund under Rule 5 of CCR
- Relying on the same, held that the appellants are eligible for refund of unutilized
cenvat credit under Rule 5 of CCR; impugned order is set aside [Para 6]
2015-TIOL-1434-CESTAT-DEL
M/s Dabur India Ltd Vs CCE (Dated: May 29, 2015)
CX - 'Anmol' Coconut oil sold in packing of 200 ml or less - Duty paid under protest on
instructions of department by adopting classification as Hair Oil (33.05) - Judgment of
Tribunal in case of Capital Technologies Ltd. classifying goods under 1513 @Nil rate of
Tariff is a binding precedent - Matter remanded for examining unjust enrichment:
CESTAT [para 9, 10, 11]
Also see analysis of the order
2015-TIOL-1433-CESTAT-MAD
CCE Vs K G Denim Ltd (Dated: June 26, 2015)
CX - Assessee filed refund claim of Rs.30,60,023/- - Deputy CCE in his order dt.
21.11.2008 had sanctioned refund of predeposit of Rs.10 lakhs (paid through cenvat
credit) in cash and rejected amount of Rs.20,60,023/ - voluntarily paid by them Revenue relied on Rule 11(3) which came into force w.e.f. 1.3.2.007 vide Notfn 10/07
CE (NT) - Assessee opted for exemption under Notfn 30/04 which exempted the
goods from whole of excise duty - Case relates to period prior to 9.7.2004 and
amendment to Rule 11 was inserted only from 1.3.2007 - Said amendment cannot
have any retrospective effect for earlier period - Therefore, in absence of any specific
provision in said notfn or any other provision prior to 1.3.2007, there is no lapse of
credit and sub-rule(3) cannot be applied retrospectively for period prior to 9.7.2004 Said Notfn is a conditional one and cannot be considered as absolute exemption and
Clause(ii) of sub rule(3) of Rule 11 is applicable only if final product is exempted
absolutely - Accordingly, assessee have rightly utilized the credit for payment of
predeposit of Rs.10 lakhs as per Tribunals interim order and voluntarily paid
Rs.20,60,023/- through cenvat account towards the demand - Assessee neither closed
their unit nor their registration is cancelled and they are fully viable and functioning
and producing Denim fabrics and clearing for domestic as well as for exports and also
discharging ST liabilities - Therefore, by following decision in case of Steel Strips
2011-TIOL-656-CESTAT -DEL -LB it is held that predeposit amount of Rs.10 lakhs and
Rs.20,63,023/- voluntarily paid cannot be allowed by way of cash refund and said
refund is to be allowed by way of re -credit in cenvat account - Both the assessee's
and Revenue's appeal are partly allowed and refund amount of Rs.30,60,023/- is
allowed by way of recredit in cenvat credit account and not by cash refund: CESTAT
2015-TIOL-1432-CESTAT-DEL
M/s Sharda Forging And Stamping Pvt Ltd Vs CCE (Dated: February 5, 2015)
CX - Assessee has not maintained separate accounts for furnace oil used in both final
products - They have reversed cenvat credit attributable to furnace oil used in
manufacture of exempted final products - If the assessee reversed proportionate
cenvat credit attributable to final exempted product and have complied with Rule 6(3)
of CCR, 2004 is not required to pay duty equal to 10% sale price of exempted final
products - Contention of Revenue that Commissioner (A) has observed that while
reversal of cenvat credit, assessee has taken sale percentage of exempted goods,
which is not correct, is not acceptable at all as in SCN, only charge against assessee is
that they have contravened the provisions of Rule 6(3) - Order set aside and appeal
allowed: CESTAT [Para 7, 8]
2015-TIOL-1431-CESTAT-AHM
Micro Inks Pvt Ltd Vs CCE, C & ST (Dated: June 11, 2015)
CX - ST paid by assessee on external commercial borrowings (ECB), on which ST was
paid under Banking and Other financial services under reverse charge mechanism ECB services availed by assessee are clearly in relation to business activities and for
promoting the inks manufactured by assessee - It is the case of assessee that during
relevant period activities relating to business was covered with definition of inputs
services under Rule 2 (l) of CCR, 2004 - No contrary arguments are available in orders
passed by lower authorities in this regard.
Held: Cenvat Credit taken by assessee with respect to ECB, for which tax was paid
under Banking and other financial services, is therefore covered with in definition of
Rule 2(l) of CCR, 2004 - Appeal allowed: CESTAT
2015-TIOL-1430-CESTAT-MAD
M/s Tafe Ltd Vs CCE (Dated: May 5, 2015)
Central Excise - Stay / dispensation of pre deposit - MRP based Assessment Difference in MRP between Maharashtra & Gujarat explained as owing to octroi
payable for Maharashtra - same not considered; demand confirmed, considering
higher MRP, and agitated herein.
Held: As per MRP declared on the packets, appellants are manufacturing batteries and
clearing under MRP - As per the declaration in respect of batte ries manufactured for
Amco Batteries Ltd. they have declared two MRP one for "other States" i.e. Rs.2,336/and Rs.2,440/- for "Maharashtra"; since clearance to Maharashtra attracts Octroi the
price of Rs.2,440/ - is inclusive of octroi amount - In view of the rulings in the cases of
SMV Beverages Pvt. Ltd., and Amtrex Hitachi Appliances Ltd., appellants have made
out a prima facie case for waiver of entire amount of dues. [Para 4, 5]
2015-TIOL-1429-CESTAT-MAD
M/s Aqua Sub Engineering Vs CCE & ST (Dated: May 15, 2015)
Central Excise - Exemption - Appellants are manufacturers of power driven pumps and
exempted from excise duty - Thrust bearing assembly manufactured by the appellant
emerges as an intermediate product and used in the manufacture of submersible
pumps - Appellants claimed Notification No. 6/2000 dated 01.03.2000 under Sl.No.
250, denied in adjudication where the adjudicating authority classified the goods
under the heading 8483.90 and held that thrust bearing assembly was nothing but
bearing - demands adjudged with interest and penalty and agitated herein.
Held: Identical issue has been dealt by the Tribunal in the case of KSB Pumps Ltd. Tribunal discussed the Board's circular dated 4.12.02, which is relied upon by the
department and also considered the decision in the case of Mather & Platt (I) Ltd. and
allowed the appeal - in view of the Apex Court's decision upholding the KSB Pumps
ruling, the issue stands settled and the impugned order is set aside. [Para 5, 6]
2015-TIOL-1426-CESTAT-DEL
M/s Vaibhav Ispat Pvt Ltd Vs CC & CE (Dated: May 12, 2015)
CX - Assessee are a manufacturer of M.S. Ingots, raw materials for wh ich are M.S.
Scrap and Sponge Iron and goods manufactured by them are covered for exemption
under notfn 50/2003-CE - Assessee under their letter dated 26.3.2010 had filed
necessary declaration to jurisdictional CE Authorities informing that they will
commence commercial production on or before 31.03.2010 - Dispute is as to whether
commercial production had commenced on or before cut off date of 31st March, 2010
- Date of commencing of commercial manufacture is date of commissioning of plant
when newly commissioned plant had been run and some goods of desired quality had
been produced - Merely on basis of load survey report for 30.03.2010 & 31.03.2010,
it would not be correct to conclude that there was no production of M.S. Ingots on
these dates - Engineer of IIPL which had supplied induction furnace has given a
certificate that on 30.03.2010, plant was in position to start commercial production Further, Department's side except for its analysis of load survey report no evidence to
the contrary has been produced - Just because the production entry for 29.03.2010
was false, it cannot be presumed that production entries for 30.03.2010 and
31.03.2010 were also false - Therefore, it has to be concluded that manufacturing unit
of assessee company had commenced commercial production on or before 31.03.2010
and is eligible for exemption under said notfn - Appeal allowed: CESTAT
2015-TIOL-1425-CESTAT-MUM
Scor Taur Impex Vs CCE (Dated: April 20, 2015)
CX - Appeals dismissed - ROM applications filed on the ground that in view of the
Larger bench decision in the case of Steel Tubes of India Ltd. 2006-TIOL-1720CESTAT -DEL -LB Tribunal could not have upheld penalty imposed on them applications are not in the na ture of rectification of any mistake apparent on record
and, therefore, not entertainable - moreover, in view of judgment of Punjab &
Haryana High Court in case of Vee Kay Enterprises 2011-TIOL-174-HC-P&H -CX
decision of LB does not hold the field any more - On both grounds viz. entertainability
as also on merit, ROM applications dismissed: CESTAT [para 4, 4.1]
ROM application - As per Central Excise law no more than three adjournments can be
given to a party even for main appeal - Already four chances have been given to the
applicant and, therefore, Bench is not inclined to grant further adjournment in the
matter - Applicatio ns taken up for disposal on merit: CESTAT [para 3]
2015-TIOL-1420-CESTAT-DEL
CCE Vs M/s U P Telelinks (Dated: May 11, 2015)
CX - Assessee was a manufacturer of electric items - Revenue views that assessee
was engaged in activity of trading also and required to reverse proportionate Cenvat
credit attributable to trading activity - None of lower authorities have considered the
defence taken by assessee that they have cleared inputs as such and no verification
has been done to that effect - As revenue has failed to produce any evidence to show
that assessee was involved in trading activity, it may cleared inputs as such - As per
provisions of Rule 3(5) of CCR, 2004, assessee was to reverse Cenvat credit availed
on inputs cleared as such, therefore, assessee is not required to pay any amount
equivalent to 6% /8% of value of inputs cleared as such: CESTAT
2015-TIOL-1417-CESTAT-DEL
Everest Rolling Mills Pvt Ltd Vs CCE (Dated: April 23, 2015)
CX - Clandestine removal - Assessee are manufacturers of rolled pro ducts, raw
material for which is MS Ingots - NIPL was one of their supplier of MS Ingots - NIPL
were not showing entire quantity of MS Ingots sold by them to various customers in
R G-1 register and were paying duty on much lesser quantity - Since assessees were
among customers of NIPL, quantity of MS Ingots supplied by NIPL to these units
during period 02/8/05 to 01/10/05 as per entries of NIPL ledger book was compared
with supplies as per NIPL records in respect of which invoices had been issued - No
cross examination of concerned persons of NIPL who had made entries in ledger
books had been allowed - Therefore, entries in ledger book of NIPL by themselves
cannot be treated as an evidence of assessees having received certain quantity of
unaccounted MS Ingots and having used that quantity in unaccounted production of
rolled products and their clandestine clearance - Power consumption of SSSRM cannot
be applied to assessee units for estimating their actual production on basis of their
power consumption, more so , when absolutely no study or experiment has been
conducted by Department in support of its claim - In these cases not even inspection
or study has been conducted to determine their actual power consumption norm Neither any evidence unaccounted purchase of raw material nor there is any evidence
of clandestine/ unaccounted clearances of final product - Merely on basis of an
arbitrarily adopted power consumption norm, production of an assessee on basis of
his power consumption cannot be estimated and duty demand cannot be affirmed
against him on this basis - Appeals allowed: CESTAT [Para 6, 7, 8, 9]
2015-TIOL-1411-CESTAT-DEL
M/s Triveni Engg And Industries Ltd Vs CCE(Dated: May 26, 2015)
CX - Rule 9 of CER, 2002 - CCR, 2004 - Sugar Mill and co -generation plant situated
across the public road are connected through overhead conveyor by which bagasse
generated in the sugar mill is transferred to co-generation power plant and electricity
produced is used for its operations - units are to be treated as inter-linked and both
units have to be treated as one factory - denial of common registration absurd CENVAT of capital goods and services used for setting up power plant admissible Appeals allowed: CESTAT [para 6]
Also see analysis of the order
2015-TIOL-1410-CESTAT-MAD
M/s Indian Additives Ltd Vs CCE (Dated: February 13, 2015)
Central Excise - CENVAT credit - appellants are engaged in the manufacture of
additives for lubricating oil and availed credit on inputs received in tankers as well as
in packaged condition in drums and barrels - they carryout stock taking of the inputs
on monthly basis at the end of the month and the quantity of the inputs found to be
short were subsequently adjusted in their records as consumption - Revenue viewed
the credit attributable to stock shortages merited reversal; adjudicated demands,
agitated herein - Appeal E/141/2006 is in second round of litigation, remanded by HC.
Held: No shortage between the physical stock and the book stock for more than 70%
of the period, and only for particular months there is a huge shortage - If the
difference is due to the measurement method between the actual weighment and the
massflow meter is to be taken there is no consistency - If at all any inputs remained
in the pipelines in a continuous process then the same should have been reflected
every month; there cannot be abrupt and sudden shortage of inputs only in particular
months during the year. [Para 8]
There is no uniformity in the shortage of inputs and it is evident that this shortage
cannot be attributed to the difference in measurement because of heating of liquids,
or evaporation loss, or remnant of inputs in pipelines as claimed by the appellants the inputs are having high viscosity and not volatile in nature - since the shortage of
inputs accounted only for specific months and not in a continuous manner it is
established that the shortage of inputs is not on account mere difference in variation
of weigment methodology and the said quantity of inputs have not been used in the
manufacture of final products - case laws relied upon by the appellants distinguished
on facts. [Para 9, 11]
Tribunal's LB in the case of Bhuwalka Steel Industries clearly laid down the guidelines
for allowing credit on shortage of inputs to be made on the basis of tolerance limits Division Bench of the Tribunal in the case of Philips Carbon Black held that credit is
reversible on the shortage of inputs on account of the difference between the physical
measurement and massflow meters, same squarely applicable to instant case shortages cannot be treated as process loss or evaporation or calibration or
weighment loss; hence appellants are not eligible for the modvat/cenvat credit; and
the demand for reversal upheld. [Para 12, 13, 14]
It is a clear case of suppression of facts where the appellants deliberately adjusted the
shortage as if it is consumed in the manufacture of final products at the end of every
month and created fresh opening balance at every month without making reversal of
credit on the shortage of inputs - extended period sustained in terms of the Jharkhand
HC ruling in the Prestressed Udyog case squarely applicable; penalty imposed under
Section 11AC upheld and penalty imposed under Rule 13 & 15 of CCR set aside. [Para
15].
2015-TIOL-1409-CESTAT-MAD
Chennai Petroleum Corporation Ltd Vs CCE (Dated: April 16, 2015)
Central Excise - Restoration of Appeal - Appeals dismissed by Tribunal for non
clearance by Committee on Disputes prayed to be restored herein.
Held: When the appeal was dismissed by the Tribunal, it was conscious of the law
declared in the ONGC case by the Apex Court as to resolution of dispute between
Union of India and Central PSUs - appellant was permitted to contest appeal only on
levy of penalty, clearly demonstrating that the appellant was estopped to contest
beyond the scope of decision of the Committee on Disputes on any other aspect Further, the appellant has come after 7 years to the Tribunal for restoration of its
appeal - Tribunal does not have power to review its own orders in absence of specific
provision in law granting power of review; even though penalty was not imposed in
the adjudication, there was no permission to litigate on duty demand - Although
decision of Committee on Disputes is no m ore requirement according to Apex Court
ruling in ECIL case, there is specific denial by Committee to dispute further probably
to prevent wastage of time of the court as well as resources - appellant is not
permitted to litigate further with Revenue. [Para 6, 7]
2015-TIOL-1402-CESTAT-AHM
Garden Silk Mills Ltd Vs CCE & ST (Dated: June 09, 2015)
CX - Interest - Assessee has already paid entire CENVAT Credit demand on GTA
services availed from place of removal - Assessee fairly agreed that interest on
irregularly taken credit may be payable - As per Market Systems Ltd 2014-TIOL-1036CESTAT -AHM , interest on in-admissible CENVAT Credit taken is payable by assessee:
CESTAT
CX - Penalty - In case of ABB Ltd. it was held that GTA services from the place of
removal is admissib le even after date of amendment to CCR - This order passed by
Larger Bench was set aside by Karnataka High Court only in year 2011 - Therefore,
assessee had a bonafide belief that such CENVAT Credit taken is admissible - It is not
a fit case for imposition of penalty under Rule 15(4) of CCR, 2004 - Penalty set aside:
CESTAT
2015-TIOL-1401-CESTAT-DEL
Bayer India Ltd Vs CCE & ST (Dated: January 21, 2015)
CX - Assessee were engaged in manufacture of Pesticides/Insecticides classifiable
under sub -heading 380510 of Schedule to CETA, 1985 - Assessee cleared the inputs
as such and reversed credit availed on the inputs - In case of Tata Motors Ltd . 2010TIOL-1604-CESTAT-KOL after considering explanation of Rule 57AB (b) of CCR, 2004,
it is held that reversal of credit availed at the time of receipt of inputs is sufficient at
time of clearance as such from factory of production - Impugned order is set aside
and appeal allowed: CESTAT
2015-TIOL-1397-CESTAT-DEL
Jindal Stainless Ltd Vs CCE & ST ( Dated: May 22, 2015)
CX - CENVAT - Power grid to whom electricity is sent for synchronization is to be
treated as a job worker - since electricity was returned back to the Appellants factory
there is a substantial compliance with the provisions of Rule 4(5)(a) of CCR, 2004
CENVAT credit availed on fuel (furnace oil) used in generation of electricity cleared to
Electricity Board is admissible - Appeal allowed: CESTAT [para 4, 5, 8, 10, 11, 13]
Also see analysis of the order
2015-TIOL-1396-CESTAT-DEL
Dynamic Motors Vs CCE & ST ( Dated: April 28, 2015)
CX - It is alleged that assessee has suppressed the fact that they are authorized
dealer of General Motors - Said fact has been recorded by Tribunal in assessee's own
case vide order dated 4.11.11 reported in 2011-TIOL-1876-CESTAT-DEL which has
been arisen out of O -I-O dated 28.12.10 which means that before 2010, it was in
knowledge of department that assessee is an authorised dealer of M/s. General Motors
for selling vehicle - Therefore, allegation against assessee that they have suppressed
the fact is not correct - SCN cannot be issued to assessee by invoking extended period
of limitation - Therefore, demand in impugned order is not sustainable Consequently, impugned order is set aside and appeal allowed: CESTAT
2015-TIOL-1395-CESTAT-DEL
M/s Food And Health Care Specialities Vs CCE (Dated: May 28, 2015)
CX - Valuation - s.4 of CEA, 1944 - Expression "interest directly or indirectly" used in
clause (iv) of s. 4(3)(b) of CEA, 1944 would refer to the financial interest only - The
real test of a related person transaction tainted by "interest directly or indirectly in the
business of each other" is that the purpose of the transaction is not the sale of
goods/services by the seller to the buyer at fully commercially providing price but
something else, like seller wanting to reduce his tax liability etc. - AV determined in
accordance with decision in Ujagar Prints is legal and proper - Demand of Rs.9.35
crores set aside and appeals allowed: CESTAT [para 8, 9, 13, 14]
Also see analysis of the order
2015-TIOL-1394-CESTAT-MUM
Keva Flavours Pvt Ltd Vs CCE (Dated: June 26, 2015)
CX - Appellants had to vacate the factory premises due to a family dispute - since the
new factory was not ready and fearing that they would be forcibly removed they
shifted entire unit to an adjoining premises and informed the department & took
registration la ter - CE duty demanded on finished goods, work-in-process, CENVATted
inputs, ordering confiscation and imposing redemption fine and penalties - technically
there are some procedural irregularities committed by the appellants but there is no
need to demand duty - Finished goods were cleared on payment of duty from new
premises - Work -in-progress goods were converted into finished goods and cleared on
payment of duty - Duty demand set aside along with interest & penalty, RF reduced &
penalty reduced on Director, penalties on other appellants set aside: CESTAT [para
7.1]
Also see analysis of the order
2015-TIOL-1389-CESTAT-AHM
M/s Praful Overseas Pvt Ltd Vs CCE, C & ST (Dated: March 12, 2015)
CX - Application for Modification of Stay Order was filed by assessee to waive pre deposit entirely - They submits that Stay Order was passed on the basis of decision of
Gujarat High Court in case of Cadila Healthcare Ltd and appeal against the decision of
Cadila Healthcare Ltd was admitted by Supreme Court and there fore, such decision
cannot be a precedent - They relied upon decision of Supreme Court in case of West
Coast Paper Mills Ltd - It is well settled that precedents are binding only in context of
facts of each case - Decision of High Court in Cadila Healthcare Ltd is against the
assessee and Supreme Court had not granted any stay and the said decision is in
force and binding on this Bench - Co-ordinate Bench of Tribunal in case of Sushil
Agarwal , made the observation without going into facts in case of West C oast Paper
Mills Ltd - A judgement has to be read in context of its facts and it is not permissible
to pick and choose certain words from judgement and it cannot be a precedent - No
merit in application filed by assessee, accordingly, application for Modif ication of Stay
Order is dismissed - Period of compliance extended for further two weeks: CESTAT
[Para 7, 8]
2015-TIOL-1388-CESTAT-MUM
M/s Indo Count Industries Ltd Vs CCE (Dated: April 30, 2015)
CENVAT - Rule 9 of CCR, 2004 - Credit of SAD availed on strength of supplementary
invoices denied on the ground that duty was paid by supplier after detection of short
levy - Tribunal has held that non-reversal of SAD by M/s MIRC Electronics - 2015TIOL-636-CESTAT -MUM cannot be with intention to evade duty on such components,
as the appellant had discharged appropriate duty liability of CVD/CE - Credit
admissible - Appeal allowed with consequential relief: CESTAT [para 6]
Also see analysis of the order
2015-TIOL-1382-CESTAT-DEL
M/s Steel Mongers India Pvt Ltd Vs CCE (Dated: March 2, 2015)
CX - Penalty - No statement of assessee has been recorded neither any summons to
record statement have been issued to assessee - Statement of manufacturing supplier
shows that they were issuing invoices to M/s. Rupesh Bansal - Assessee contends that
they have received goods under cover of invoices issued by M/s. Khemka Ispat
Limited - This statement of assessee was never tried to test level of investigation nor
any other corroborative evidence have been produced in investigation that assessee
has received invoices, not the goods - Statement of second stage dealer to whom
assessee has issued invoices in his statement admitted that they have received goods
from assessee against duty paid which were sold to manufacturing buyer who already
admitted that he has received goods - Therefore, statement of second stage dealer
and manufacturing buyer supported the case of assessee and in absence of any
statement of assessee, now question arises why statement of assessee was not
recorded during course of investigation - Therefore, it is concluded that investigation
against assessee is incomplete - Penalty under Rule 26 of CER, 2002 is not imposable:
CESTAT
2015-TIOL-1381-CESTAT-DEL
M/s Rama Vision Ltd Vs CCE (Dated: March 26, 2015)
CX - Notfn 50/2003-CE - Expansion of production capacity - Assessee rely upon
certificate given by M/s B.K. Arora and Associates which certifies that assessee have
expanded their installed capacity and this has been achieved by installing additional
equipment as per details given and by modification of certain existing machinery Revenue, however, relies upon report of Professor Arun Kumar of Department of
Electronics and Computer Engineering in IIT, Roorkee who has doubted correctness of
certificate of Chartered Engineer - Commissioner has chosen to rely upon opinion of
Professor Arun Kumar on ground that -"he is an independent authority and his report
is a later report and only a Chartered Engineer's certificate cannot wish away expert's
report" - Said conclusion is wrong, as a Chartered Engineer is as much an expert as a
Professor of IIT - Merit in assessee's plea that a Professor of Department of
Electronics and Computer Science is not competent to give opinion on question
whether substantial expansion of installed capacity of production had been
undertaken, which is a discipline of Mechanical Engineering - Since Commissioner's
conclusion is based on expert opinion of Professor Arun Kumar, h is cross examination
by assessee should have been permitted as report of Professor Arun Kumar is only an
opinion whose correctness has to be tested by his cross examination - Matter
remanded: CESTAT
2015-TIOL-1379-CESTAT-BANG
Nikhil Refineries Pvt Ltd Vs CCE, ST & C (Dated: January 27, 2015)
Central Excise -Disputed Classification - Extended period of limitation - Sustainability Classification of Palm Stearin oil under chapter 50 as held by Tribunal in favor of
assessee was reversed by Supreme Court holding that it is classifiable under chapter
38 instead -During the relevant period in question, appellant had filed all the returns
claiming the classification under Chapter 50 based on Tribunal's decision - In the
circumstances, no malafide intention can be attributed to the assessee to invoke
longer period of limitation -Appellant has a strong prima facie case on limitation Impugned order set aside - Matter remanded to Commissioner (A) to decide the
appeal without insisting on any pre-deposit.
2015-TIOL-1374-CESTAT-BANG
Mag Engineering Pvt Ltd Vs CCE (Dated: December 12, 2014)
Central Excise - Refund of interest on differential duty - Entitlement - Appellant failed
to include value / cost of components supplied free of cost - Differential duty demand
set aside as unsustainable by Tribunal was upheld by the Supreme Court - Appellant
held is entitled to interest on such differential duty paid during the course of judicial
proceedings notwithstanding absent enabling provision in the statute - Matter is
remanded to the original adjudicating authority to consider the refund claim afresh
only as to whether unjust enrichment is attracted or not - Appeal allowed by way of
remand. (Para 5)
2015-TIOL-1373-CESTAT-BANG
Linkwell Telesystems Pvt Ltd Vs CCE, C & ST (Dated: January 30, 2015)
Central Excise - Suo motu credit of CENVAT reversed earlier held does not require
filing of any refund claim - No dispute about the recredit of the said entry - Denial of
the same by the department on technical ground of non -filing of refund application is
neither proper nor justified more so when such recredit was made upon intimation to
the Revenue - It is nothing but correction of entries in the accounts maintained by the
assessee which does not involve any 'lis' and any legal issue requiring the department
to interfere - Impugned order set aside - Appeal allowed with consequential relief.
(Para 4, 5)
2015-TIOL-1372-CESTAT-AHM
M/s Indian Oil Corporation Ltd Vs CCE & ST (Dated: June 19, 2015)
CX - LABFS and LARO manufactured by the appellant are classifiable under CETH
2710.29 but are not entitled for the benefit of Notification 75/84 -CE as the same is
available only in respect of ‘Kerosene' which is ordinarily used as illuminant in oil
burning lamps - Kerosene has to be understood with respect to
interpretation/understanding attributed by those who deal in 'Kerosene' - product
LABFS and LARO are not cleared as Kerosene at all and only used for the purpose
other than for illuminant oil for burning lamps or other domestic use – Appeal partly
allowed: CESTAT
2015-TIOL-1371-CESTAT-MUM
Amrut Bhagini Mandal Vs CCE (Dated: June 08, 2015)
CX - Job work - Detaining part of LDPE received from customer and replacing the
same by locally purchased cheaper LLDPE - difference in the value is nothing but
additional consideration and is required to be added in AV of final product Polyfilm Appeal dismis sed: CESTAT [para 5, 6, 7]
Also see analysis of the order
2015-TIOL-1365-CESTAT-MUM
Mahanagar Gas Ltd Vs CCE (Dated: June 23, 2015)
CENVAT - Rule 2(l) of CCR, 2004 - definition of "input service" does not restrict that
the said services have to be rendered in the factory premises of the manufacturer Services of inspecting vehicles at RTO is an Input service - Credit admissible - Appeals
allowed: CESTAT [para 6.1, 6.2, 6.3]
Also see analysis of the order
2015-TIOL-1364-CESTAT-KOL
M/s Philips Carbon Black Ltd Vs CCE (Dated: March 24, 2015)
CX - CENVAT credit denied on the ground that supporting documents disclosing the
details of services received from service providers had not been enclosed with
respective input service invoices issued by assessee's registered office as input service
distributor - Assessee submits that because of voluminous nature of supporting
documents, only consolidated statements were furnished whereas they are in a
position to submit invoices issued by respective service providers in favour of
registered office - Impugned order is set aside and appeal allowed by way of remand:
CESTAT [Para 5]
2015-TIOL-1357-CESTAT-MUM
Manikgarh Cement Vs CCE (Dated: March 9, 2015)
CENVAT - Rule 2(l) of CCR, 2004 - Credit in respect of services of certification of
pollution level is admissible even though the service in the hands of the service
provider is not taxable but the service tax was admittedly paid by the service provider
– Issue involved has been dealt with by the Tribunal in appellants' own cases in their
favour - Appeal allowed: CESTAT [para 6, 7]
2015-TIOL-1356-CESTAT-DEL
CCE Vs Punjab Tractors Ltd (Dated: May 25, 2015)
CX - Whether the Transmission Assemblies (TA) captively consumed in the
manufacture of tractors of Engine Displacement Capacity (EDC) below 1800-CC
manufactured by respondent during the period 1.8.1996 to 1.06.1998 is exigible to
excise duty – CCE, Chandigarh coming to the conclusion that Transmission Assembles
are not excisable products emerging at intermediate stage during the manufacture of
Tractors – demand of excise duty of Rs.5,50,99,810.00 dropped - Revenue in appeal.
Held: Supreme Court in the case of Escorts Ltd. 2015-TIOL-92-SC-CX has held that
TA which comes into existence during manufacture of Tractor is an intermediate
product and the same is a distinct product commercially known to the market as such;
that the transmission assemblies of tracto rs are commercially known products, and
that the fact that not a single sale of such Assembly has been made by the appellants
is irrelevant - levy of excise duty on TAs which came into existence in the course of
manufacture of Tractors is, therefore, upheld: CESTAT [para 8]
Limitation - In the process of manufacture filed with the department, from time to
time the respondent has declared the identifiable sub assemblies - The process of
manufacture undertaken by respondent has been made known to the departm ent - It
has never been the case of Department that these sub-assemblies were suppressed in
the declaration filed - In such circumstances, the respondent cannot be alleged of any
contumacious conduct warranting invocation of extended period – SCN issued for the
period 1.8.1996 to 1.06.1998 on 31/08/2001 is wholly time barred and the duty
demand is not sustainable on limitation : CESTAT [para 10]
2015-TIOL-1353-CESTAT-AHM
M/s Chiripal Industries Limited Vs CCE & ST (Dated: May 6, 2015)
CX - Notfn 30/2004-CE - Whether benefits of exemption under Sr. No. 6 of Table to
said Notfn will be admissible to assessee - Facts involved in present appeals and facts
involved in case of Garden Silk Mills Limited are identical - A different view is not
required to be taken - There was a general practice in trade to claim benefit of Sr. No.
6 of table annexed to said Notfn - Assessee can not be said to have any malafide
intention if same benefit was availed by them which was also being availed by
similarly placed manufacturers - Extended period for raising demands under Section
11A of CEA, 1944 can not be invoked against assessee: CESTAT [Para 4.1, 4.2, 5]
2015-TIOL-1350-CESTAT-DEL
R K Machine Tools Ltd Vs CCE & ST (Dated: January 30, 2015)
CX - As per Indsur Global Ltd. 2014-TIOL-2115-HC-AHM-CX , condition contained in
Rule 8(3A) regarding payment of duty without utilizing the cenvat credit during the
period of default beyond period of one month from the due date is unconstitutional Requirement of pre-deposit of duty demand, interest and penalty is waived - Stay
granted: CESTAT
2015-TIOL-1349-CESTAT-DEL
M/s Havells India Ltd Vs CCE (Dated: January 16, 2015)
CX - CENVAT credit is admissible of Additional Customs Duty paid through DEPB scrips
in respect of the imports made under notification no.34/97-Cus - There is no such
condition in the indicated notifications that the debits made, in DEPB, the licenses
issued under the Foreign Trade Policy only would be eligible for credit and the debits
made in DEPB issued under the previous policy will not be eligible for credit - Appeals
allowed: CESTAT [para 6, 7]
2015-TIOL-1348-CESTAT-DEL
JCB Ltd Vs CCE & ST (Dated: February 9, 2015)
CX - Appellant received chassis from manufacturers on which they built the bodies on
job work basis and they returned the complete vehicles from where the same are
cleared on payment of CE duty - Department by invoking Chapter Note 5 of Chapter
87 of the CETA, 1985 took a view that since the appellant have ‘manufactured' the
motor vehicles, they also would be required to pay automobile cess under Industries
(Development and Regulation) Act, 1951, notwithstanding the fact that the chassis
manufacturers had also paid automobile cess at the time of clearance of the chassis
from their factory – Appeal to CESTAT.
Held: Circular no.41/88 dated 31.08.88 clarified that the matter had been referred to
the Administrative Ministry, who have intimated that the intention is to realize such
levy (automobile cess) from the vehicle manufacturers and not from the body builders
– This Circular is still in force and has not been withdrawn – Prima facie view is that
notwithstanding introduction of chapter note 5 in Ch.87 w.e.f 2005, as the Board
Circular 41/88 is still valid, the order of the lower authorities is not correct – Pre deposit waived and stay granted – Stay applications allowed: CESTAT [para 6]
2015-TIOL-1347-CESTAT-BANG
Wisdom Steel Tech Pvt Ltd Vs CCE, C & ST (Dated: January 29, 2015)
Central Excise - Non-manufacturing activity - Cenvat Credit availed on inputs in the
process - Held, credit cannot be disallowed when assessee used the same for payment
of duty on its final product, when there was no requirement of payment of duty on the
final product - Question of reversal of Cenvat does not arise - Impugned order
requiring reverse of Cenvat set aside - Appeal allo wed with consequential relief. (Para
3) - Assessee Appeal allowed
2015-TIOL-1340-CESTAT-KOL
M/s Filter Manufacturing Industries Pvt Ltd Vs CCE (Dated: January 14,
2015)
CX - Assessee having two units engaged in the manufacture of different types of
industrial filters - It is alleged that assessee had availed CENVAT Credit on certain
inputs at their unit-1, but removed the same as such without reversal of CENVAT
Credit to their Unit No.2 where such inputs were used in manufacture of final product
at Unit No.2 and cleared on payment of duty - Assessee failed to establish that inputs
received at their Unit-2 and had been utilized in or in relation to manufacture of final
product - No reason to interfere with aforesaid finding of Commissioner(A) - Appeal
rejected: CESTAT
2015-TIOL-1337-CESTAT-DEL
Key Locks (India) Vs CCE (Dated: March 20, 2015)
CX - Clandestine removal - best judgment assessment made by the Adjudicating
Authority holding that CR Strips of 37,381 kgs. and MS Wire of 4,526 kgs. gave rise to
clandestinely removed key locks of 1,49,524 numbers cannot be faulted - The
authority rightly determined duty liability of Rs.10,51,824/ - on such count - Appellant
did not provide any material to establish impossibility of manufacture of 1,49,524
locks - In absence of any technical or scientific data, it is not possible to discard the
conclusion of emergence of 1,49,524 locks out of shortage of goods found - Appellants
should have come out with clean hands to show approximate weight of CR Strip and
MS Wire used in manufacture of a lock of each specification, arise of scrap if any,
wage incurred for manufacture as well as the overhead charges required in that
regard - In absence of any such data, determination of value of the locks of 1,49,524
numbers cannot be found to be faulty -Shortage of raw material gives rise to the
conclusion of clandestine clearance with the intention to cause evasion of duty - No
doubt, there may be certain amount of arbitrariness in best judgment assessment But the estimation itself when sustained in the first round of litigation and shortage of
stock was found by Tribunal, appellant's questionable conduct came to record Demand correctly confirmed & Penalty rightly imposed on appellant: CESTAT
CE - Duty demand on locks found short also upheld, so also premise of M/s. R.P.
Locks was found to be berthing place for clandestinely removed goods of the appellant
"duty demand of locks found in the said premises upheld" Demand also proper in r/o
Job worked value of goods which escaped duty: CESTAT
Penalty imposed on Shri Ravi Jain - Adjudicating Authority has not found his active
involvement in the clandestine removal and it was only a presumption - In absence of
any cogent and credible evidence of his conscious involvement and nexus, the penalty
levied on him is waived: CESTAT [para 8]
2015-TIOL-1330-CESTAT-BANG
Datasol Innovative Labs Vs CCE, ST & C (Dated: Januray 8, 2015)
Central Excise - Malafides - Manufacture and supply of helicopter and aircraft parts Bonafide belief that parts supplied to defence as such were exempted from payment
of duty in terms of existing notifications and clarification issued by the
Commissionerate - Conflicting decisions of Tribunals with no uniform opinion
expressed on benefit of notification in question - In the circumstances, malafides
cannot be attributed to the appellant. (Para 8)
Central Excise - Proper Certificate - Benefit of Notification No. 10/97-CE dated
01.03.1997 - Certificate is required to be duly signed by Deputy Secretary of the
concerned Ministry - Certificate issued by CSIO and Aeronautic Development Agency
and the signatory is a person holding the rank in pay scale higher than the Deputy
Secretary to Government of India - Certificate is proper - No suppression or
misdeclaration can be attributed to the assessee so as to invoke longer period of
limitation - Denial of benefit on ground of claim based on improper certificate, is also
unjustified - Entire demand being barred by limitation is unsustainable - Impugned
order is set aside - Matter is remanded to Commissioner for fresh decision, limiting
the demand to the period of limitation, granting the benefit of Cenvat credit of duty
paid on inputs - Appeal allowed by way of remand. (Para 9)
2015-TIOL-1329-CESTAT-BANG
Expert Industries Pvt Ltd Vs CCE, C & ST (Dated: March 2, 2015)
Central Excise - Denial of input credit service - Challenge - Manufacture of Printing
and Lamination machinery - Cenvat credit of service tax paid on Security Service,
Telephone and Manpower Supply Service provided to different units located in the
main Unit - Goods wherever manufactured finally go to the main unit and clearance of
payment of duty takes place from the main unit only - Unlike in the case of inputs
where credit can be taken only when it is received in the factory, in respect of input
service there is no such restriction - Credit is admissible - Impugned order set aside Appeal allowed with consequential relief. (Para 6)
2015-TIOL-1328-CESTAT-DEL
Kirat Fabricators Vs CCE & ST (Dated: March 3, 2015)
CX - Assessee had commenced commercial production of tubular poles and other
accessories in 2009 - Goods including tubular poles are recovered for exemption
under Notfn 56/02-CE and their unit is located in area specified in said notfn Assessee did not pay duty in respect of clearances of poles in view of Apex court
judgment in case of Hindustan Poles Corporation 2006-TIOL-29-SC-CX while they in
view of Apex court's judgment in case of Prachi Industries - 2008-TIOL-81-SC-CX
were liable to pay duty on tubular poles - As per Commissioner's impugned order,
they would be liable for Cenvat credit of Rs. 80,83,283/ - and Commissioner while
confirming above duty demand of Rs. 1,11,74,291/ - has permitted Cenvat credit,
their net duty liability would be about Rs. 31,00,000/ - - Question as to whether
benefit of Notfn 56/02-CE can be extended to them from year 2009, requires in depth
examination which cannot be done at this prima facie stage - Assessee is directed to
deposit Rs. 6,00,000/-: CESTAT [Para 6]
2015-TIOL-1327-CESTAT-AHM
Goodluck Empire Vs CCE & ST (Dated: December 12, 2014)
Central Excise - Stay / dispensation of pre deposit - CENVAT credit - availment
without receipt of inputs - demands confirmed with interest and penalties on firms
upstream and downstream, apart from penalties on individuals under Rule 26 of CER
2002; agitated herein.
Held : Since the main appellant M/s. Nakoda Alloys Private Limited has deposited
almost 50% of the amount confirmed as ineligible cenvat credit and are contesting the
issue on merits, same considered enough to hear and dispose the appeals of all the
three appellants on merits - M/s. Goodluck Empire & M/s. Jenil Empire to deposit an
amount of Rs. 15,000/ - (Rupees fifteen thousand only) each within four weeks [Para
3, 5]
2015-TIOL-1325-CESTAT-MUM
CCE & C Vs M/s S H Re-Rolling Mills (Dated: May 15, 2015)
C X- Revenue is unaware about the disposal of appeal – Misc. application for re-calling
of order is infructuous and, therefore, dismissed: CESTAT [para 1]
Also see analysis of the order
2015-TIOL-1323-CESTAT-BANG
M/s Hindustan Zinc Ltd Vs CCE (Dated: March 9, 2015)
Central Excise - Reversal of Cenvat Credit - Closure and dismantle of Lead plant - No
evidence that inputs have been written off as obsolete or unfit for utilization in the
books of accounts - Question of reversal of credit does not arise - The Order of
Commissioner (A) holding that provisions of Rule 3 relating to reversal do not apply to
the factual situation in question does not suffer from any infirmity - Revenue appeal
has no merits hence is reje cted. (Para 6, 8)
Central Excise - Penalty - Sustainability - Closure and dismantle of lead plant Quantity of lead concentrate recovered at the time of dismantle of plant in question No proof of clandestine removal or intention to evade duty forthcoming from the
Revenue - No evidence placed on record by appellant that the quantity in question
was received prior to 1994 as pleaded - As the duty liability is not contested by
appellant, penalty is waived. (Para 5)
2015-TIOL-1318-CESTAT-BANG
M/s Gangadhara Steel (P) Ltd Vs CCE (Dated: March 9, 2015)
Central Excise - Cenvat Credit - Duty paid on angles, channels, beams etc use in the
factory machinery/equipment - No evidence or records to show as to which machinery
or equipments, these angles, channels, etc. have been used as accessories /
components - Adequate opportunity given to provide the documentary evidence Request for remand hence rejected - Further in view of the total amount involved is
less than Rs. 1.40 lakhs and credit was allegedly availed during construction, penalty
imposed set aside while upholding demand of credit with interest. (Para 4 -7)
2015-TIOL-1317-CESTAT-DEL
CCE Vs M/s Bharat Heavy Electricals Ltd (Dated: May 6, 2015)
CENVAT - Rule 6 of CCR, 2004 - Goods supplied against International Competitive
Bidding at Nil rate of duty in terms of notification 6/2006 -CE - Common inputs/input
services for manufacture of dutiable and exempted goods - whether 10% amount
payable in terms of rule 6(3) of CCR, 2004 in respect of goods cleared against IC B.
Held: Department's contention that clause (vii) of sub rule (6) is not applicable to the
goods manufactured in India, but is applicable only to the imported goods is absurd,
as the clause - (vii) cannot be read in isolation but has to be read with the main
provision of sub rule 6 - Moreover Rule 6 of the Cenvat Credit Rules is in respect of
the goods manufactured in India and this rule, in general, contains provisions
regarding denial of cenvat credit in respect of inputs/ input services which have gone
into the manufacture of exempted final products or exempted output services - There
is nothing in this sub rule from which it can be inferred that clause - (vii) is applicable
to the goods imported into India - Appeal dismissed: CESTAT [para 6, 6.1]
CX - Review order passed by two senior Chief Commissioners is an absurd order
passed with absolutely no application of mind and as such there is absolutely no merit
in the appeal filed by the Revenue - We are amazed as to how such an absurd order
can be passed by such senior officers of the Department: CESTAT [para 6.1]
Also see analysis of the order
2015-TIOL-1316-CESTAT-MUM
Aurangabad Electricals Ltd Vs CCE, C & ST (Dated: June 15, 2015)
CX - Al dross, turning, oily flash generated during manufacture of MV Aluminium parts
given to jobworker situated within same factory premises for conversion into ingots Jobworker is to be considered as an independent manufacturer of Al ingots clearances cannot be held to be for captive consumption since in view of Leave and
licence agreement, jobworker is an independent entity and benefit of captive
consumption notification 67/95-CE not available - however, clearances of remnants
(intermediate goods) are to be considered as being covered under rule 4(5)(a) of
CCR, 2004/rule 16A of CER, 2002 - job work is not liable for duty, in terms of
notification 214/86-CE dated 25/3/1986 as final product is cleared on payment of duty
- No duty liability arises on clearances of remnants to job worker: CESTAT [para 5]
Also see analysis of the order
2015-TIOL-1315-CESTAT-MUM
M/s Bajaj Auto Ltd Vs CCE & ST (Dated: June 8, 2015)
CENVAT - Employee was involved in fraudulent act of taking credit, without receipt of
inputs, for his personal gain - such act cannot be attributed to appellant company as a
mala -fide act, as the act of fraud admittedly is not authorized and can never be
authorized by the management of the company -Equivalent penalty imposed is
unwarranted, hence set aside -however, interest payable: CESTAT [para 7, 8]
Also see analysis of the order
2015-TIOL-1314-CESTAT-MUM
M/s Isibars Limited Vs CCE (Dated: March 31, 2015)
CX - Whether the appellant is entitled to CENVAT credit in respect of furnace oil used
in the manufacture of goods on job work basis and cleared without payment of duty
under notification 214/86 -CE. Held: Amount of CENVAT credit availed on furnace oil
was reversed from time to time and refund was claimed thereafter - original authority
rejecting the same on merit as well as on unjust enrichment but Commissioner(A)
setting aside the order - Revenue appeal dismissed by Tribunal citing the LB decision
in Sterlite Industries - 2005-TIOL-305-CESTAT-MUM-LB - It is absolutely clear that
the issue in the present appeal has already attained finality - appellant is entitled for
re-credit of the amount reversed by them in r/o furnace oil subject to verification of
the said amount by adjudicating authority - appeal allowed by way of remand:
CESTAT [para 5]
2015-TIOL-1313-CESTAT-DEL
M/s Asil Industries Ltd Vs CCE (Dated: January 14, 2015)
Central Excise - Refund under Rule 5 of CCR 2004 - appellant firm, manufacturers of
CR Steel strips and HNT Steel Strips (main items) from HR Coils, exported finished
goods under bond; filed refund claim for unutilized credit availed on HR Coils - During
adjudication, the original authority deducted duty related to sale of waste and scrap
generated during manufacture of main items and ordered refund of the balance; same
upheld by Commissioner (Appeals) and agitated herein.
Held: No dispute that the conditions prescribed in the notification issued under this
Rule and also the conditions of the exports not having been made by claiming duty
drawback or input duty rebate stand satisfied; only dispute is as to whether the duty
payable on the scrap cleared for home consumption during the quarter to which the
refund claim pertains and also whether the amount recovered from the customers as
duty on the sale of waste and scrap during the material period can be deducted from
the refund - for these deductions there is absolutely no authority; appellant would be
eligible for cash refund of the accumulated Cenvat credit taken in respect of inputs
which have been used in the manufacture of goods which has been exported under
bond/LUT and in this case, cash refund can be disallowed only to the extent the
cenvated inputs are contained in the scrap cleared for home consumption on payment
of duty - impugned order is set aside and the matter is remanded to the Assistant
Commissioner for re -determining the quantum of cash refund under Rule 5 payable to
the appellant and the differential amount, if any, due shall be paid to them. [Para 6]
2015-TIOL-1312-CESTAT-MAD
Hindustan Pencil Pvt Ltd Vs CCE (Dated: April 15, 2015)
Central Excise - Manufacture - Commissioner (Appeals) held that mixture of graphite
and clay coming into existence is marketable product;and upheld the classification
made by the adjudicating auth ority under Heading 6815 1020 discarding the claim of
the appellant that it is not liable to duty for no marketable goods manufactured impugned order agitated herein.
Held : Tribunal in the Umesh Pencil Processors case considered the Apex Court ruling
in the United Phosphorous case and concluded that mixture of graphite and clay
cannot be bought and sold in absence of evidence of any marketability; same was
upheld by Apex Court -impugned order legally unsustainable.
2015-TIOL-1311-CESTAT-MAD
CCE Vs Aquasub Engineering (Dated: April 24, 2015)
CX - Refund - Assessments under Rule 8 of the CE Valuation Rules of clearances of
intermediate products to sister units finalized and refunds held admissible but credited
to Consumer Welfare Fund on ground of unjust enrichment - Commissioner (Appeals)
granted relief, agitated by Revenue herein.
Held: Lower appellate authority dealt the issue in detail and passed an elaborate order
extending reasons and came to the conclusion that price of the final product cleared
by the sister unit remained constant as the goods was exempted from excise duty respondents opted for provisional assessment for want of cost of raw materials
consumed in the manufacture of exempted goods - In a number of decisions of Apex
Court, High Court as well as Tribunal, it has been consistently held that when there is
no change in the price of the final product cleared and there is no increase in the rate
of duty, the bar of unjust enrichment is not applicable - Tribunal in the case of CCE
Kanpur Vs Corona Cosmetics & Chemicals examined an identical issue and rejected
Revenue's appeal - Following the same, the bar of unjust enrichment is held not
applicable in the present case; there is no infirmity in the impugned orders which are
upheld [Para 5, 6, 7]
2015-TIOL-1303-CESTAT-DEL
M/s Chandrawati Polymers Pvt Ltd Vs CCE (Dated: April 9, 2015)
CX - Assessee manufactures industrial and decorative laminates and there is no
dispute that more than 90% of production is supplied to Indian Railways either
directly or through dealers and through M/s. Shaktri Sales and M/s. P.A. Sales - There
is no possibility that laminates of below 3 mm. could have been supplied by CPPL to
Railwa ys in violation of contract terms - Huge difference between quantity of
laminates supplied by CPPL to Indian Railways either directly or through M/s. P.A.
Sales and M/s. Shakti Sales and quantity manufactured by them as per the RG-I
Register - All the dealers from whom the laminates are claimed to have been
purchased, have on inquiry stated that they had supplied the laminates of 0.6 mm. to
1.5 mm. thickness only - Therefore, assessee's claim that quantity of laminates
supplied to Railways in excess of quantity whose production is recorded by them
during period of dispute, had been procured by them from various dealers is false Not only this, three opportunities of hearing were given to them but they have not
appeared for the same -No infirmity in impugned order - Appeal dismissed: CESTAT
[Para 5]
2015-TIOL-1296-CESTAT-MUM
Vako Seals Pvt Ltd Vs CCE (Dated: May 15, 2015)
CX - Service is not tangible unlike inputs or capital goods - Scope of service is not
limited within the four corners of factory - even if same services are received by the
appellant at any place directly or indirectly, related to manufacturing activity or
rela ted to business activity of the assessee, irrespective whether it is provided within
the factory or outside the factory, credit is admissible - ST paid on renting of Gala
which was not part of manufacturing activity is also admissible as CENVAT credit:
CESTAT [para 5]
Also see analysis of the order
2015-TIOL-1295-CESTAT-MUM
M/s Shri Sant Tukaram SSK Ltd Vs CCE (Dated: May 30, 2015)
CX - Rule 6 of CCR, 2004 - During the manufacture of sugar, Bagasse, Press mud and
Fly Ash get generated which are sold by the appellant - appellant clears the Bagasse,
Press mud and Fly Ash without payment of duty claiming them to be non -excisable Revenue has alleged that since appellant has not maintained separate accou nts in
respect of common goods and input service, they are required to pay an amount of
5%/10% of the value of exempted non -excisable goods. Held: In appellant's own
case, order dt. 6.2.2014 - 2014-TIOL-2862-CESTAT-MUM it has been held that press
mud is waste and non-excisable and provisions of rule 6(3) are not attracted decision is binding one and if the appellant has paid an amount under protest, same
has to be refunded - waste cannot be considered as a bye-product and hence it
cannot be said that common inputs or input services are utilized - order set aside and
appeal allowed with consequential relief: CESTAT [para 6, 7]
2015-TIOL-1294-CESTAT-MUM
CCE Vs M/s I J Muthu Foods Pvt Ltd (Dated: May 26, 2015)
CX - Appeals filed by Revenue involving interest of Rs.52,028/- - in terms of
Government Litigation Policy vide F.No. 390/Misc./163/2010/JC dated 17/08/2011,
Revenue is not supposed to file appeal against the order of the Commissioner(A) if
amount involved is less than Rs.5 lakhs - Monetary limit prescribed under the
Circular/letter is also applicable in the cases which were filed prior to issuance of the
Litigation policy as held by various High Courts - in view of settled legal position, the
present appeal which involves amount less than the threshold limit is not
maintainable, hence appeal is dismissed without going into the merits of the case Revenue Appeal dismissed: CESTAT [para 1]
2015-TIOL-1293-CESTAT-DEL
M/s Godawari Power And Ispat Ltd Vs CCE (Dated: December 17, 2014)
Central Excise - CENVAT credit - appellant are manufacturer of sponge iron using coal
as an input; which they either import or purchase from Coal India - during the period
from 01/3/11 to 23/3/11 while Notification No. 1/11 and 2/11 prescribed rates of duty
1% and 5% without Cenvat credit and with Cenvat credit respectively, the exemption
Notification No. 63/95 -CE dated 16/3/95 extending full duty exemption without any
condition in respect of the coal produced in the mines was also in force - The
Department viewed that during that period no duty was payable by Coal India Ltd. in
respect of the coal produced by them; whatever amount was paid has to be treated as
deposit; and therefore, the appellant were not eligible to avail Cenvat credit of the
excise duty paid by CIL on the coal - demand for recovery of irregular credit along
with interest and penalty imposed on them under Rule 15 (2) of Cenvat Credit Rules,
2004 read with Section 11AC of Central Excise Act and agitated herein.
Held : During the material period of dispute, the coal received by the appellant from
Coal India Ltd. was fully exempt from duty under Notification No. 63/95-CE dated
16/3/95 and at the same time duty @ 1% adv. has been imposed by Notification No.
1/11-CE subject to condition that no Cenvat credit is taken and duty @5% has been
imposed under Notification No. 2/11-CE with Cenvat credit - issue stands decided
against the Department by the Apex court judgment in the case of MDS Switchgear,
as also the Punjab & Haryana High Court ruling in the cases of Ranbaxy Labs and V.G.
Steel Industry holding that the assessments made at the supplier's end cannot be
reopened at the recipient's end and on this basis the Cenvat credit of the duty paid by
the supplier cannot be denied to the recipient - impugned order unsustainable, same
is set aside. [Para 6]
2015-TIOL-1290-CESTAT-DEL
Diamond Cement Vs CCE & ST (Dated: January 19, 2015)
CX - Assessee received petroleum coke from a 100% EOU - They were required to
avail cenvat credit in terms of formula prescribed in Rule 3 (7) (a) of CCR, 2004 but
instead of doing so, they have taken cenvat credit of entire additional customs duty
and education cess and secondary and higher education cess portion of excise duty
paid on by the goods - As per Commissioner (A)'s order, assessee were also eligible
for cenvat credit of SAD paid on by goods, if they are eligible for SAD credit and its
quantum is considered, quantum of excess credit alleged to have been taken may
come down - Impugned order set aside and matter remanded: CESTAT
2015-TIOL-1286-CESTAT-MUM
M/s Sapna Coils Pvt Ltd Vs CCE (Dated: April 13, 2015)
CENVAT - Inputs - Import of Seamless copper tube ASTM B280 - Part of imported
goods cleared by appellant to sister concern on reversal of credit availed - Revenue
saddling liability on the ground that the description appearing in the bill of entry and
that on the invoice indicating clearance of goods to sister concern is mis -matching.
Held: Both the lower authorities have overlooked the description in its correct
perspective as the invoices raised by the appellant while clearing to their sister
concern indicates dimension in “inches” while bill of entry indicates description in
“mm” - on casual conversion of the dimensions in B/E and on the invoice indicates
there is no difference - Order demanding CENVAT credit is incorrect and, therefore,
set aside - Appeal allowed: CESTAT [para 8, 9]
2015-TIOL-1285-CESTAT-MUM
Shree Rubber Plast Co Pvt Ltd Vs CCE (Dated: April 16, 2015)
CX - At the instance of the CE Officers , Preventive unit, Thane-I, appellant reversing
CENVAT credit of Rs.1.70 lakhs on 12/03/2007 - subsequently, since neither any
query was raised by the department nor any SCN was issued, appellant taking recredit on 07/05/2007 - SCN issued on 09/07/2007 proposing disallowance of the said
re-credit and imposition of penalty and interest - adjudicating authority confirming
demand and imposing penalty u/r 15(1) of CCR, 2004 of Rs.2000/- which order
upheld by Commissioner(A) - appeal before CESTAT. Held: Re-credit is not against
any amount of duty payment - it is adm ittedly re -credit of an amount of CENVAT
credit debited at the instruction of the officers - because of reversal at the instance of
the departmental officers, on which the revenue has not raised any dispute on
admissiblity, recredit of the same by the appe llant cannot be faulted with - Madras HC
decision in ICMC Corporation - 2014-TIOL-121-HC-MAD-CX is clearly applicable in the
present case, hence re-credit of the amount already reversed cannot be objected to LB decision in BDH Industries relied upon by the Revenue has been departed in the
case of Sopariwala Exports Pvt. Ltd. - 2013-TIOL-1936-CESTAT-AHM - Re-credit of
CENVAT credit made by appellant is in order - Order set aside and appeal allowed with
consequential relief: CESTAT [para 5, 6, 7, 8]
2015-TIOL-1284-CESTAT-MUM
Western Coal Fields Ltd Vs CCE (Dated: May 22, 2015)
CX - Notification 63/95-CE - A workshop which is in an area in the environs of a mine
and is existing solely for the purpose connected with the mine and under the same
management is obviously directly serving the mining operations - hence, the
notification should be interpreted so as to include such a workshop within the
definition of a mine for the purpose of grant of exemption as that would encourage
the mining industry - apex court decision in South Eastern Coalfield - 2006-TIOL-87SC-CX followed - appeal allowed with consequential relief: CESTAT [para 2, 3]
2015-TIOL-1283-CESTAT-BANG
Sonar Impex Vs CCE, C & ST (Dated: May 12, 2015)
Central Excise - Refund - It is unfortunate that law enforcing/implementing agency
chooses to ignore the law and just because assessee became entitled to refund,
proceeded to somehow deny refund, without even considering legal options. While the
Commissioner (Appeals)allowed refund, without challenging the order revenue
initiated a fresh Show Cause Notice. The legal process adopted in this case shows that
opportunities to proceed properly on the part of the Revenue in this case were
missed/lost. The second round of litigation initiated itself was unwarranted and
probably has to be held void. In any case allowing the appeal with consequential relief
and holding the proceedings ab initio void have the same consequences. Therefore
appeal is allowed with consequential relief to the appellants.
2015-TIOL-1280-CESTAT-MUM
M/s Vaibhav Forge Vs CCE (Dated: May 15, 2015)
CX - Rule 8(3A) of CER - Appellant defaulted in monthly payment of duty and paid the
defaulted amount beyond 30 days from the due date along with interest - Demand
raised and confirmed for recovery of Rs.7,17,726/- equivalent to the amount of
CENVAT credit utilized towards payment of excise duty during the period after 30 days
from due date till payment of defaulted amount when the appellant was required to
pay duty consignment wise and through PLA. Held: Gujarat High Court in case of
Indsur Global Ltd. - 2014-TIOL-2115-HC -AHM-CX has held that condition contained in
Rule 8(3A) of CER, 2002 of prohibiting utilisation of CENVAT credit is unconstitutional
and, there fore, demand was not sustainable - order set aside and appeal allowed:
CESTAT [para 4]
2015-TIOL-1279-CESTAT-MUM
Visen Industries Ltd Vs CCE (Dated: June 5, 2015)
C X- Pre -deposit - s.35F of CEA, 1944 - Availment of fraudulent CENVAT credit without
receipt of any inputs by manipulating documents and then showing purported
clearance of inputs, as such, on payment of Rs.5.64 crores - it cannot be said that
credit taken has been reversed as buyers would have taken credit of the said amount
- Pre -deposit ordered of 7.5% of the duty demanded: CESTAT [para 5, 6, 7]
CENVAT - Rule 6 of CCR, 2004 - Manufacture of dutiable & exempted goods & Trading
of inputs - Demand made of 6% amount of traded goods of Rs.1,18,45,107/- appellant contending that credit equivalent that concerning trading activity of
Rs.3,44,773/- has been reversed. Held: As far as the appellant is concerned, a total
demand of Rs.6,82,11,154/ - has been confirmed - appellant is directed to deposit
7.5% of the duty involved minus the amount of Rs.3,44,773/ - already reversed Since pre -deposit not made, appeal not maintainable, however, time given of 4 weeks
to make payment and report compliance: CESTAT [para 5, 6, 7]
Also see analysis of the order
2015-TIOL-1275-CESTAT-MUM
M/s Nasik Strips Pvt Ltd Vs CCE & C (Dated: May 13, 2015)
CENVAT - Rule 4 of CCR, 2002 - C.I.Moulds were not in possession and use of the
appellant in the subsequent year as the same were rendered as scrap and cleared
from the factory - balance 50% of credit on the said capital goods is not available and
has been correctly denied - Appeal dismissed: CESTAT [para 4]
Also see analysis of the order
2015-TIOL-1274-CESTAT-MUM
H And R Johnson (India) Vs CCE (Dated: April 1, 2015)
C X- Input Service - Rule 2(l) of CCR, 2004 - Appellant has availed credit for the year
2007-08 and 2008-09 on the strength of invoices issued by service provider in respect
of Construction services and Manpower recruitment agency service - Allegation of
Revenue is that the service provider had surrendered his licence on 16.04.2007 and
hence credit availed is incorrect. Held: Service provider had paid ST liability on the
invoices issued by them for the period 2005-06 - lower authorities have
misunderstood the provisions of CCR, 2004 - There is no time limit for availing
CENVAT credit of service tax paid on services - it is also undisputed that the appellant
had produced the ST returns filed by the service provider along with TR-6 challan
indicating discharge of ST liability on the invoices raised during 2005-06 - if the ST
liability had not been discharged by the registered unit, Revenue would not have
accepted surrender of the registration certificate - in the absence of any contrary
evidence, ST paid by the provider during 2005 -06, though the appellant has availed
credit belatedly same is within the provisions of CCR, 2004 - order set aside and
appeal allowed: CESTAT [para 4, 5]
2015-TIOL-1273-CESTAT-MUM
M/s Delta Electrotrade Control P vt Ltd Vs CCE (Dated: April 28, 2015)
CX - s.4 of CEA, 1944 - Valuation - Appellant engaged in manufacture of Transformer,
Voltage Stabilizer - goods transported to the buyers' premises where they are
required to be installed/commissioned - appellant receiving certain amount for the
said erection and commission as contract receipts - Revenue alleges that the said
charges will form part of AV - Demand confirmed by lower authorities - appeal to
CESTAT. Held: Activities of erection, installation and commissioning cannot be
considered as part of the manufacturing activity of the goods as these are post
manufacturing services - charges cannot form part of AV in view of apex court
decision in Thermax Ltd. 2002-TIOL-205-SC -CX - Demand set aside & appeal allowed:
CESTAT [para 5]
2015-TIOL-1269-CESTAT-BANG
CCE, ST & C Vs J K Fabrics (Bangalore) Pvt Ltd (Dated: March 6, 2015)
Central Excise - Refund - Service tax paid on input services like banking and financial
services, clearing and forwarding services (exports/imports), courier service, labour
contract service transportation service, telephone service, repair and maintenance
service, insurance service and professional consultancy service services clearly
covered by the inclusive part of the definition of input service - Credit is admissible Refund rightly allowed - Revenue appeal is devoid of merit. (Para 4)
2015-TIOL-1266-CESTAT-AHM
GSP Crop Science Pvt Ltd Vs CCE & ST (Dated: January 5, 2015)
CX - Assessee transferred goods from Unit-1 to Unit-2 on payment of duty at tariff
rate - According to department, Unit-1 should pay duty on basis of CAS-4 - Assessee
immediately paid differential duty and issued supplementary invoices to Unit-2, who
availed cenvat credit on basis of said supplementary invoices - CENVAT credit denied
as in violation of Rule 9(1)(b) of CCR, 2004 - There is no sale of goods but it is inter
unit transfer of stock - Impugned orders set aside and appeals allowed: CESTAT [Para
5, 7, 9]
2015-TIOL-1265-CESTAT-BANG
Karnataka Antibiotics And Pharmaceuticals Ltd Vs CCE & ST (Dated: January
7, 2015)
Central Excise -Waiver of Pre -deposit - Medicines procured from units located in
exemption zone and sold to various hospitals at a price fixed by the government in
terms of Drugs Price Control Order (DPCO) - Element of excise duty is included in the
price fixed under DPCO - Ample documentary evidence to show that appellant had not
collected duty in excess of the price fixed by DPCO - Reflection of excise duty element
separately in their invoices apparently due to a faulty software,is irrelevant-Primafacie case made out by appellant and is entitled to unconditional stay. (Para 5, 6)
2015-TIO L-1264-CESTAT-BANG
CCE Vs Hpc Electricals Ltd (Dated: March 4, 2015)
Central Excise - Clubbing of clearances - Expenditure incurred on electricity and
manpower - Clearances shown in the name of a proprietary concern added to the
clearances of Company engaged in manufacture of electrical control panels Constitute clubbing - No evidence gathered by investigating team to show as to why
the clearance of HEC should be added to the clearance of HPCEL after demanding it Further more, original authority failed to ask for details of persons employed and
actual consumption of electricity and did not verify whether electricity consumption
and manpower / employees were sufficient or not for the production shown by
proprietary firm - Major defect lie in failure to issue notice to the proprietary concern
that was pointed out and discussed by Commissioner (A) - Revenue appeal has no
merit. (Para 6, 7)
2015-TIOL-1263-CESTAT-KOL
Highco Engineers Pvt Ltd Vs CCE (Dated: March 3, 2015)
CX - Refund - Assessee submits that they applied price escalation from 01.01.2009
instead of 01.07.2009, therefore, entire amount paid in supplementary invoices, was
in excess - Documents now produced by assessee were not placed before adjudicating
authority so as to enable him to scrutinize whether burden of duty had been passed to
customer and also on aspect of eligibility of refund claim by assessee - Case
remanded to adjudicating authority so as to ascertain whether assessee are eligible to
refund claim on account of incorrect application of Price Escalation Clause and also
whether burden of duty has been passed on to customer or otherwise: CEST AT [Para
5, 6]
2015-TIOL-1256-CESTAT-DEL
M/s Annapurna Industries Pvt Ltd Vs CCE (Dated: January 15, 2015)
CX - Both assessee units engaged in manufacture of plastic containers and were
availing SSI exemption - Non-accountal of 780 KG of plastic scrap found in premises
of M/s Annapurna Industries, and there is no dispute that same was not accounted for
in RG-1 Regis te - Assessee's plea that the same being intermediate product was
meant for recycling and was exempted from duty under notfn 67/95 CE and for this
reason, same was not accounted for in RG-1 Register is acceptable - Accordingly,
confiscation of said Plastic Scrap under Rule 25(1) of CER, 2002 and imposition of
penalty on M/s Annapurna Industries is not sustainable and has to be set aside - As
regards to alleged removal of plastic containers by M/s Annapurna Industries to M/s
Shivam Udyog, there is merit in assessee's plea that these goods were not in fully
finished condition and had been shifted to adjacent premises of M/s Shivam Udyog on
account of lack of space in M/s Annapurna Industries and as such same cannot be said
to have been cleared to M/s Shivam Udyog without payment of duty - Duty demand of
Rs. 9,398/- and confiscation of said goods is set aside - Cenvat credit attributable to
4125 KG of plastic Granules found short in premises of M/s Annapurna Industries and
15,375 KG found short in factory premises of M/s Shivam Udyog can be determined
on basis of invoices issued by GAIL under which M/s JJ Packagers had received
consignments - For this limited purpose, matter remanded to Original Adjudicating
Authority - Penalty imposable on assessee would be acco rding to re -quantified cenvat
credit demand: CESTAT
2015-TIOL-1255-CESTAT-MUM
Eminence Equipments Pvt Ltd Vs CCE (Dated: May 26, 2014)
CX - Classification - Machines manufactured, in no way process the grains or even do
not do any auxiliary function before processing of grains but are limited to conveying
or lifting or storing grains - Machines correctly classifiable under Heading 8428 and
not under 8437 & are chargeable to CE duty - Matter remanded for re-computing duty
liability after extending benefit of CENVAT on production of duty paying documents equivalent penalty also to be recomputed - Penalty on MD reduced from Rs.1 crore to
Rs.10 lakhs : CESTAT
Also see analysis of the order
2015-TIOL-1248-CESTAT-DEL
M/s Albert David Limited Vs CCE (Dated: April 23, 2015)
CENVAT - Appellant manufactures I.V. Fluids and clears the same after packing them
in plastic bottles at Nil rate of duty - LDPE granules is used for manufacture of plastic
bottles and when plastic waste arises – such plastic waste is cleared on payment of
duty – Department denying CENVAT credit of Rs.22,57,683/- in respect to the plastic
granules which had gone into waste in course of manufacture of plastic bottles.
Held: Issue involved stands decided in the appellant's own case 2013-TIOL-621-HC ALL-CX ( affirmed by the Apex Court 2014-TIOL-36-SC-CX ) where it is held that in
view of the fact that the waste and scrap is final product and excisable item, taking
into consideration the scheme of CENVAT C redit, it is but obvious that the appellant is
entitled to claim CENVAT Credit on the inputs of plastic granules proportionate to the
waste and scrap – Order set aside and appeal allowed: CESTAT [para 3]
2015-TIOL-1246-CESTAT-BANG
Expert Industries Pvt Ltd Vs CCE, C & ST (Dated: March 2, 2015)
Central Excise - Delay condonation - 92 days of delay in filing appeal - Delay
occasioned due to negligence of Cost Accountant office - Reasonable cause exist Delay condoned.
Central Excise - Cenvat Credit of service tax paid by third party - Admissibility Erection, commissioning and installation of printing and lamination machines by third
party for appellant manufacturers - Service provided by the third party in installing
the machinery is a service provided to the appellant as such credit is admissible However, since there is no evidence to show that the cost of erection, commissioning
and installation has been included in the assessable value, matter is remanded to
original authority to verify the correctness of submission that said cost has been
included and accordingly decide the matter - Appeal allowed by way of remand. (Para
5)
2015-TIOL-1245-CESTAT-DEL
M/s Clutch Auto Ltd Vs CCE (Dated: April 10, 2015)
CX - Assessee manufactures automobile components - It is alleged that in respect of
1467 consignments of automobile parts, some had been sold to original equipment
manufacturers (OEMs) and 409 consignments sold to non OEM customers, in respect
of each such sale , assessee have issued two invoices bearing same number and same
description of goods but date of invoices and duty debit particular are different - Out
of two invoices, invoice of earlier date was found to be containing bogus duty debit
particulars - Assessee's explanation that this practice had been adopted to facilitate
their priority customers is not convincing, as during same period in respect of other
consignments only one invoice has been issued and there was no such irregularity Impugned order confirming duty demand of Rs.2,05,53,961/- has to be upheld:
CESTAT
CX - Initially goods had been cleared on payment of duty but subsequently same were
found to be defective, and were returned by customers and assessee received those
goods under Rule 173H but opted not to avail credit of duty initially paid on goods Even if assessee cleared defective goods under cenvatable invoices by showing duty
payment particular which were found to bogus, no duty was demandable from them,
as no duty is payable by assessee in respect of defective goods returned by them to
customers after repair under Rule 173H - Duty demand of Rs.1,75,951/- is not
sustainable - Interest is chargeable under section 11AB for period from 28.9.96 to
November, 1996 - While penalty on assessee company under Rule 173Q(1) (d) is
upheld to extent of Rs.2,05,53,961/-, penalty under Rule 209A on Shri Suresh Garg
and Shri K.P.Chitrasenan is set aside - Penalty on Shri V.K.Mehta, Managing Director
under Rule 209 is upheld: CESTAT
2015-TIOL-1244-CESTAT-KOL
CCE Vs M/s Aditya Birla Nuvo Ltd (Dated: January 13, 2015)
CX - Assessee engaged in manufacture of 'wool top' which is dutiable and 'wool
grease' which emerges as a byproduct during course of manufacture of finished goods
and exempted from payment of duty - It is alleged that they have used input 'Alphox
200' in manufacture of byproduct, 'wool grease' but failed to maintain separate
accounts - Even though in initial stage of filing appeal, revenue have not challenged
issue on merit, but now through a Miscellaneous Application, they revised grounds of
appeal, and challenged order on merit also - Issue is no more res integra in view of
Supreme Court in case of Hindusthan Zinc Ltd. 2014-TIOL-55-SC -CX , wherein it has
been laid down that separate accounts need not be maintained under Rule 57AD of
erstwhile CER, 1944 or under Rule 6(2) of CCR, 2002/2004, where use of inputs
results in emergence of byproduct, which is exempted, hence Revenue has no case on
merits - Appeal dismissed: CESTAT [Para 3, 5]
2015-TIOL-1243-CESTAT-MAD
M/s A1 Pump Ltd Vs CCE (Dated: May 26, 2015)
Central Excise - Valuation - Officers visited the Unit and found that duty paid on
impugned clearances was short of that payable on CAS4 basis - differential duty
discharged prior to issuance of SCN - penalty adjudicated and agitated herein - Held
that even before issuance of the notice the appellant discharged the liability on the
basis of CAS-4 statement, while the regular duty liability was discharged on the basis
of standard cost, leaving no scope to doubt the conduct of the appellant - no intention
to cause evasion to Revenue; penalty set aside.
2015-TIOL-1242-CESTAT-MAD
M/s Dharani Sugars & Chemicals Ltd Vs CCE (Dated: April 16, 2015)
CX - CENVAT credit - denial of credit on common inputs used in the manufacture of
sugar where bagasse and press mud are also produced; recovery of credit with
interest and penalty is the common issue agitated in these appeals.
Held: Revenue does not have any logical reason to bring out a difference to the
finding of the High Court in the EID Parry case holding inter alia that the input and
output need not have one to one relationship - Appeal No. E/391/2012 allowed [Para
2]
Allahabad High Court, in Gularia Chini Mills case held inter alia that the electricity
energy not being excisable goods nor exempted goods in terms of Rule 2(d) of the
CENVAT Credit Rules, 2004, the appellant cannot be denied of the CENVAT credit on
the common input - No evidence to show a d ifferent reason or rationale against the
principle laid down by the High Court of Allahabad - Appeal No.E/511/2012 allowed
[Para 4, 6]
The only question in E/40316/2014 is whether the bagasse generated in the course of
manufacture of sugar shall disentitle the appellant to the CENVAT credit of the
common input used and whether any percentage formula to be applied invoking Rule
6(3) of CENVAT Credit Rules, 2004 to levy on the appellant for common use of input High Court of Allahabad in Balrampur Chini Mills held inter alia that that the bagasse is
an agricultural waste of sugarcane, though marketable product, but the duty cannot
be imposed as it does not involve any manufacturing activity - No material to
distinguish the ruling, appeal allowed [Para 7, 8]
2015-TIOL-1240-CESTAT-MAD
M/s Egattur Printing & Packaging Ltd Vs CCE (Dated: April 28, 2015)
CX - Manufacture - short dispute in this appeal is whether 'Bindis' not manufactured
by appellants but affixed to the packing material manufactured by the appellant for
Amritanjan shall make it liable to duty on 'Bindis' by including value thereof to the
assessable value of the packing material.
Held: Goods which are not excisable if transplanted into the goods which are excisable
would not altogether make the same excisable goods and assessed to make the
assessee liable to pay excise duty on the combined value of both as held by the Apex
Court in the Acer India case - identical issue decided by Tribunal in Oswal Fats and
Oils case. [Para 2]
2015-TIOL-1237-CESTAT-MAD
M/s Gem Granites Vs CCE (Dated: May 12, 2015)
Central Excise - Exemption - appellants being 100% EOU effected DTA clearances
covered under para 6.8 of the policy as per Notification No. 23/2003 -CE dated
31.03.2003 under Sl. No. 3 read with condition No.3 - Demands confirmed denying
benefit of Notification No.22/2003-CE and agitated herein.
Held : Notification No.22/2003 exempts the goods when brought in connection with
manufacture and packaging or production into EOU, it relates to the procu rement of
inputs, raw materials and capital goods for manufacture of finished goods by the EOU
- Therefore, notification referred both in the show cause notice and in the impugned
order not related to EOU clearance of finished goods into DTA market and not relevant
to the payment of duty on the goods cleared by EOU to DTA - Further the issue on
merits has already been decided by the Tribunal in Final Order No. 470/2007 dated
01.05.2007 in the appellants own case - impugned order set aside [Para 4]
2015-TIOL-1236-CESTAT-MAD
CCE Vs Electralloy Special Steel Castings Pvt Ltd (Dated: April 17, 2015)
CX - CENVAT credit - issue relates to availment of cenvat credit on Goods Transport
Agency Service and its utilization for payment of service tax - held admissible by
Commissioner (Appeals) and agitated by Revenue herein.
Held: Issue stands settled in respondent's favor by Chennai HC in the Cheran
Spinners case wherein all the issues including Board's circular dt. 3.10.2005 relied by
the Revenue were considered - no infirmity in the impugned orders passed by
Commissioner (Appeals), which are upheld. [Para 5, 6]
2015-TIOL-1235-CESTAT-MUM
M/s Dinshaws Dairy Foods Ltd Vs CCE (Dated: February 24, 2015)
CX - Classification - Frozen Dessert - Appellant claiming the same is an "Ice Cream"
[SH 2105] while Revenue of the view that the same is "Other than Ice Cream" [SH
2106]. Held: - Prima facie issue is covered by the apex court decision in Connaught
Plaza Restau rant (P) Ltd. - 2012-TIOL-114-SC -CX where it is held that in the absence
of a statutory definition in precise terms; words, en tries and items in taxing statutes
must be construed in terms of their commercial or trade understanding, or according
to their popular meaning; that "Softserve" to be classified as Ice cream under SH
2105 of CETA, 1985 - Pre-deposit waived and stay grante d: CESTAT [para 4]
2015-TIOL-1234-CESTAT-BANG
Hyva India Pvt Ltd Vs CCE, C & ST (Dated: January 12, 2015)
Central Excise - Inordinate delay of 325 days in preferring appeal - Condonation Delay attributed to employee going on maternity leave without any evidence to
substantiate that said employee was dealing with Central Excise matters - No
plausible explanation - Limitation cannot be diluted to condone such inordinate delay Appeal deserves to be rejected. (Para 7, 9, 10)
2015-TIOL-1233-CESTAT-DEL
Dhampur Specialty Sugar Ltd Vs CCE & ST (Dated: February 10, 2015)
CX - COD of 90 days - Assessee has given a reason for about 90 days delay in filing of
appeal which is plausible and which is not disputed by Department - Moreover, delay
of 90 days in filing of appeal also cannot be said to be unreasonable and such a long
delay which cannot be condoned, more so, when according to assessee's version, they
discovered the order of Commissioner (A) in their employee's cupboard in sometime
in August, 2014 and immediately thereafter, filed the appeal - This is not a case,
when looking to length of delay and conduct of assessee, it can be said that condoning
delay would result in injustice to other side, rather not condoning the delay would
result in injustice to assessee - As per MST. Katiji and Others - 2002-TIOL-444-SC LMT , 90 day's delay in filing appeal is condoned: CESTAT
2015-TIOL-1227-CESTAT-DEL
N S Ispat Pvt Ltd Vs CCE (Dated: March 31, 2015)
CX - Assessee are manufacturer of M.S.Ingots from sponge iron - During course of
manufacture of M.S.Ingots, slag dust arises, which is waste and same is fully exempt
from duty under Notfn 4/06 -CE - No separate accounts for inputs/input services used
in manufacture of dutiable goods and exempted final products - Even if manufacturer,
in accordance with provisions of Rule 6 (2) wants to maintain separate account or
inventory of inputs/input services used in manufacture of dutiable products MS ingots
and take credit only in respect of inputs and input services used in manufacture of MS
ingots, this is impossible as slag emergesd as an inevitable and unavoidable byproduct - Lex Non Cogit ad Impossibila is a well settled legal principle applicable in
respect of taxation matters also - When it is impossible to comply with the provisions
of sub-rule (2) of Rule 6, it would not be applicable - As per Hindustan Zinc Ltd. 2014TIOL-55-SC -CX , stay granted: CESTAT [Para 6, 7, 8]
2015-TIOL-1226-CESTAT-DEL
M/s Bharat Heavy Electrical Ltd Vs CCE & ST (Dated: June 4, 2015)
CENVAT - Rule 6 of CCR, 2004 - Amount of 5%/10% paid to Government but also
'recovered' from customers - such amounts cannot be treated as 'additional
consideration' and added to sale price so as to again demand 5%/10% on the same Appeal allowed: CESTAT by Majority
Also see analysis of the order
2015-TIOL-1218-CESTAT-DEL
CCE Vs M/s Bharat Aluminium Co Ltd (Dated: April 24, 2015)
CX – Aluminium Dross & Skimmings arising during the manufacture of Aluminium
products cleared without payment of duty - Department of the view that the
a luminium dross and skimming is excisable goods as the same are specifically covered
by heading 2620.00 and are marketable – Demand confirmed of Rs. 1,07,57,673/from them for the period from June 2003 to March 2005 alongwith interest –
Commissioner(A) setting aside demand following apex court decision in Indian
Aluminium Company Ltd. and holding that the aluminium dross and skimming
emerging in process of production of aluminium are not marketable goods – Revenue
in appeal. Held: Bombay High Court in the case of Hindalco Industries Ltd. 2014TIOL-2266-HC-MUM-CX while reversing CESTAT LB decision has held that even w.e.f.
10/5/08, the dross and skimming of aluminium cannot be treated as excisable goods
– Commissioner(A) decision upheld and Revenue appeal dismissed: CESTAT [para 5]
CX – Classification – Aluminium Dross & Skimmings - In terms of Chapter Note 3 to
Chapter 26 of the Tariff, heading 26.20 applies only to that ash and residue which are
used in the industry for extraction of metal or as starting material for manufacture of
metal compounds - Such ash and residues would, obviously, be marketable as there
would be demand for the same from metal extraction and chemical ind ustry - But in
this regard, no evidence in form of evidence of end use of the dross for extraction of
Aluminium or for manufacture of Aluminium compound has been produced - Therefore
the dross and residues, in question, is not covered by 2620 – order of
Commissioner(A) is correct: CESTAT [para 5]
2015-TIOL-1217-CESTAT-DEL
M/s Bhushan Steel Ltd Vs CCE & ST (Dated: February 13, 2015)
CX - Assessee is clearing goods from their factory gate, in some cases goods are
cleared from depots and in some cases goods are sold on FOR basis to their
customers - Assessee contends that they are not charging any freight towards freight
charges from custome rs when goods are cleared from depot - If selling price of goods
from factory and from depot are same, in that case assessee is entitled to claim
Cenvat Credit on outward transportation charges paid by them from their factory to
depot otherwise not - Said fact can be ascertained by adjudicating authority by going
through records of assessee - As regards to goods sold on FOR basis, as
transportation charges have been included in assessable value of goods and same are
delivered on door of buyer, therefore, ownership of goods remains with assessee Assessee has complied with condition of CBEC circular 97/8/2007 - On transportation
charges where goods are sold on FOR basis assessee is entitled to claim Cenvat Credit
- Matter remanded: CESTAT [Para 7, 8, 9, 10]
2015-TIOL-1216-CESTAT-DEL
M/s Godfrey Philips India Ltd Vs CCE & ST (Dated: March 17, 2015)
CX - Pan Masala Packing Machines (Capacity Determination and Collection of Duty)
Rules, 2008 - Whether appellant is required to pay duty for whole of the period or
required to pay duty on pro rata basis after availing the abatement for closure period
and consequently is entitled to claim the abatement of excess duty paid or not.
Held - Tribunal in Kays Fragrance Pvt. Ltd. & Shree Flavours Pvt. Ltd. held that the
appellant is not required to first pay the duty for whole of the month and then claim
the abatement and that he is required to pay only the duty for the days for which
machines were operating and only interest can be asked for the delayed payment –
appellant is entitled for abatement of duty as claimed – Appeal allowed with
consequential relief: CESTAT [para 7, 8, 9]
2015-TIOL-1215-CESTAT-DEL
Good Year India Ltd Vs CCE (Dated: February 06, 2015)
CX - Strict law of limitation provided in section 11B of Central Excise Act, 1944 would
not apply to the refund claim pursuant to the notification issued under Rule 57F notification no. 85/97 CE(NT) provides that the claim for cash refund under Rule 57F
(13) is to be filed within the limitation period pre scribed u/s 11B and section 11B
prescribes the limitation period which is to be counted from the 'relevant date' as
defined in that section, neither this notification nor section 11B gives the definition of
the 'relevant date' for the purpose of cash refund under Rule 57F (13) -cash refund
under Rule 57F (13) becomes admissible only after export of the goods having been
made under bond and when the assessee cannot utilize the CENVAT Credit
attributable to the inputs used in the manufacture of the goods cleared for export
under bond -Therefore, it may not be correct to treat the date of clearance of the
goods for export as the 'relevant date' – order set aside and appeal allowed –
Appellant would be eligible for cash refund under section 57F (13) only if in terms of
the Tribunal's final order dated 14//2015 they reverse the AED (GSI) Credit of Rs .
21,38,512/-in their CENVAT Credit Account: CESTAT [ para 6]
2015-TIOL-1214-CESTAT-BANG
M/s Maini Precision Products Pvt Ltd Vs CCE (Dated: January 7, 2015)
Central Excise - Manufacturer or Job Worker - Rule 10 A of the Central Excise
Valuation (Determination of Price of the Excisable Goods) Rules 2000 - Applicability Appellant manufacturing and selling filters to M/s Bosch Ltd in terms of a contract
providing supervision of inputs and requiring purchase of raw materials/inputs from
suppliers identified by Principal customer - Does not make manufacturer a Jo b worker
- Rule 10A has no application - Prima-facie case made out by appellant - Pre-deposit
is waived. (Para 4, 5)
2015-TIOL-1212-CESTAT-DEL
Pawan Polyplast Pvt Ltd Vs CCE (Dated: March 20, 2015)
CX - Assessee availed CENVAT Credit under Rule 16 of CER, 2002 in respect of
consignments of plastic moulded furniture returned from distributor for being re-made
/ re -manufactured on ground that same were defective - Said amount includes Credit
of Rs. 51,160/- in respect of consignment of returned goods found by officers on
20/7/2002 - Assessee themselves conceded that those goods were not those which
had earlier been manufacture and cleared by them - Duty demand of Rs. 51,160/- has
to be upheld - As regards to demand of balance amount of Rs. 6,66,719/-, merely on
basis of statement of Shri G.M. Bhandari, it cannot be presumed that in past also,
assessee had taken CENVAT Credit under Rule 16 of CER, 2002 in respect of old and
used plastic furniture received by them which had not manufactured and cleared by
assessee on payment of duty - CENVAT Credit demand of Rs. 6,61,719/ - along with
interest and equivalent penalty is not sustainable - Re-moulding charges are for
expenses incurred for re-processing and re-manufacturing of goods and same cannot
be treated as consideration for goods earlier cleared - Re -moulding charges are not
includible in assessable value and as such duty demand of Rs. 1,73,427/-alo ng with
interest and equivalent penalty is not sustainable: CESTAT [Para 13, 15]
Valuation - As regards the dispute regarding including the amortized cost of moulds in
assessable value of goods, assessee themselves conceded that the same would be
includible - Amortized cost must be calculated in accordance with Board's Circular No.
170/4/96CX - Out of duty demand of Rs. 7464/-, duty demand of Rs. 2936/- can be
confirmed and rest of the demand on this count is set aside: CESTAT [Para 14]
2015-TIOL-1210-CESTAT-DEL
Sarvottam Rolling Mills Pvt Ltd Vs CCE (Dated: February 06, 2015)
CE - Appellant is engaged in manufacturing of MS Bar - Factory was visited on
29.07.2009 at 11.05 hrs and panchnama was drawn - proceedings were concluded at
11.30 hrs on 29.07.2009 - whole of the proceedings were completed within a span of
25 minutes i.e. drawing of the panchnama and physical verification of stock of almost
2000 Metric tonnes which is not possible by all the means - Stock taking is not proper
and shortage found are only on estimate basis which is not acceptable - Shortage
found at the time of p hysical verification on 29.07.2009 is not sustainable Accordingly, demand is set aside, so, interest and penalty is not imposable: CESTAT
[Para 6]
CENVAT - For the inadmissible Cenvat Credit on Joist Angle, appellant has already
reversed Cenvat Credit and not disputed the same - Demand on that account has
been confirmed along with interest - penalty is not imposable: CESTAT [Para 7]
2015-TIOL-1209-CESTAT-DEL
Perfetti Van Melle India Pvt Ltd Vs CCE ( Dated: March 2, 2015)
CX - Assessee are manufacturers of sugar confectionaries and having two units, one
unit in Chennai and second Unit in Gurgaon - According to assessee, goods
manufactured by them i.e. mentos mint are "other sugar confectionary" classifiable
under sub -heading 1704.90 of Tariff, while according to Department, goods are
classifiable as "Chewing Gums" under sub -heading 1704.10 - Tribunal in respect of
appeal filed a gainst order of commissioner, has set aside Commissioner's order on
grounds of limitation - Since proceedings against Gurgaon Unit are based on
proceedings against Chennai Unit, and since in this case also SCN for demand of duty
for period from April 2003 to February, 2005 has been issued by 30th April 2008,
prima facie same would also be time barred - Merit found in assessee's plea that
goods covered under sub-heading 1704.10 would be those where it is gum which
gives them essential character and in-fact in terms of Provisions of Food Adulteration
Rules 1955 (para A/25.02.01), bubblegums and chewing gums must contain not less
than 12.5% to 14% of gums - Product, in question, contains about 1% or less of gum
arabic - Even on merit, assessee have strong prima facie case in their favour Staygranted: CESTAT
2015-TIOL-1206-CESTAT-DEL
Sports And Leisure Apparels Ltd Vs CCE & ST (Dated: March 24, 2015)
CX - Place of removal - Assessee cleared goods from their factory on stock transfer
basis to warehouses from where certain quantity of goods was sold to customers and
remaining quantity was transported to retail outlets for sale - Input services were
availed for transportation of goods from factory to warehouse/retails outlets and
various services availed at retail outlets - It is the warehouse /retail outlet which has
to be treated as place of removal and, therefore, assessee would be eligible for cenvat
credit in respect of services availed upto the place of removal - Stay granted: CESTAT
[Para 3, 5]
2015-TIOL-1204-CESTAT-MUM
Rajarambapu Patil Ssk Ltd Vs CCE (Dated: January 08, 2015)
CE - Appellant is engaged in manufacture and clearance of Sugar and Molasses Bagasse generated is burnt in the boiler as fuel and steam is generated which in turn
is used in the turbine for generation of electricity - Electricity is partly used for
running the plant and partly sold to Maharashtra State Electricity Board (MSEB) Revenue invoking rule 6(3) of CCR, 2004 and seeks 10%/5% amount of the value of
exempted electricity generated and supplied. Held: Appellant submitting that for
generation of electricity no excisable input is used and only bagasse and DM water is
used which are not CENVATable inputs - Identical issue decided by Allahabad High
Court in the case of Gularia Chini Mills - 2013-TIOL-568-HC -ALL-CX by holding that
there is no cause for payment of any amount of 10%/5% - said judgment followed by
Division Bench in Shree Datta SSK - 2015-TIOL-560-CESTAT -MUM - demand,
therefore, not sustainable - Appeal allowed with consequential relief: CESTAT [para 5]
2015-TIOL-1196-CESTAT-MAD
CCE Vs M/s Sree Srinivasa Processing (Dated: May 22, 2015)
Central Excise - Clandestine clearances - Officers intercepted vehicle with
consignment of dyed cotton woven fabrics without valid documents in Mar 2001; the
goods and vehicle were seized on the reasonable belief that the same were processed
and cleared clandestinely without payment of duty - Investigation was launched into
the transactions, records examined, statements of individuals recorded and it was
concluded that appellant effected clandestine clearances of fabrics and that the
individuals involved were culpable - confiscation of seized goods and vehicle, duty
demand with interest and penalty on firm and individuals adjudged - portion of the
demand dropped by Commissioner related to job work for principal (AP & Sons) and
consignee of clandestinely cleared goods (Sindhu Cotton Mills -SCM); same agitated by
Revenue herein on the grounds that the Commissioner has not taken into
consideration the details of processed fabrics received by SCM and AP& Sons and not
considered the evidences relied by the department and also white papers bearing the
signature of Shri C. Manikandan, employee of the respondent company where he
signed as "cash received"; and which also contain the quantity, colour of the
processed fabrics; and that the offence was established beyond doubt.
Held : The department has carried out extensive investigation subsequent to seizure
of dyed cotton woven fabrics pertaining to the respondent unit without valid
documents transported and intercepted in transit check - The investigation established
clandestine removal of goods by recovery of private records from SCM, AP & Sons and
Sree Balaji Fabrics etc., and also from the respondent unit - The lower authority's
findings is not well founded since the entire investigation emanated from the seizure
of dyed cotton woven fabrics clandestinely removed from the respondent's unit
without any valid documents and without payment of central excise duty, which is not
in dispute - It is clearly brought out in the investigation that Shri C. Manikandan, an
employee of the respondent company had accompanied the said goods for delivery to
SCM and his signature was found in the white papers relating to past clearances - The
adjudicating authority failed to consider the vital statements recorded from Shri R.
Rajasekaran, who is the Managing Partner of the respondent company and Shri K.R
Senthil Kumar, Proprietor of SCM and statement of Shri P. Murugesan, Managing
Partner of AP & Sons, the top persons who mange the entire activities - adjudicating
authority failed to take note of the statement of Shri R. Rajasekaran, Managing
partner of the respondent unit, which is supported by other statements and records department clearly established the receipt of non duty paid processed fabrics by SCM
- white papers signed by Shri C. Manikandan for delivery of goods and cash received
are vital evidences which were not discussed by the adjudicating authority - the
department ha s clearly brought out in the SCN clandestine clearance of processed
fabrics without payment of duty with connivance of the suppliers ie., SCM and AP &
Sons through their employee. [Para 13, 15, 16]
Statements of Shri K.P. Senthil kumar, Proprietor of SCM and Shri P.Murugesan,
Managing Partner of AP & Sons wherein they have categorically admitted clandestine
operation have been overlooked - They have not only admitted that they used to send
fabrics to the respondent unit for processing and received the processed fabrics
without bills but also confirmed that they used to pay the job charges to Shri C.
Manikandan, after getting signature on the white sheets, clearly confirming modus
operandi adopted by the respondent unit in connivance with the suppliers - The
statements of Shri R. Rajasekaran, Shri K.P. Senthil Kumar and Shri P. Murugesan are
of vital importance in establishing the case and all the three are managing their
respective company and they are fully aware of their day to day transactions between
the respondent - statements recorded before the central excise officer is a valid
evidence and it cannot be said to be coercive [Para 17, 18]
Ratio of Apex Court rulings in the Kalvert Foods case and D.Bhoormul case squarely
applicable - department established offence beyond doubt - on the material available
on record which is supported by the statements, it is established beyond doubt of the
clandestine removal of excisable goods without accounting and without payment of
duty and without any valid document - Impugned order is set aside to the extent of
dropping of demand and (i) Demand raised in the SCN dated 17.07.2001 is confirmed
after allowing the cum-tax benefit and after applying correct rate of duty for 2000 2001 and on revised quantity for 2000-2001 in respect of clearance of goods to SCM;
(ii) Demand of interest is confirmed under Section 11AB on the revised demand; (iii)
Penalty imposed on the respondent M/s. SSP under Rule 173 Q of CER read with Rule
25 of CER under Section 11AC of CE Act equivalent to the revised demand - The
adjudicating authority directed to requantify the demand amount as ordered above
within 60 days from the date of receipt of this order. [Para 18, 19, 20, 23]
2015-TIOL-1195-CESTAT-BANG
M/s Pan Parag India Ltd Vs CCE (Dated: December 30, 2014)
Central Excise - Denial of abatement benefit - Closure of the factory for the
continuous period of 15 days in terms of PMPM Rules , 2008 - Benefit denied as there
was no prior intimation of closure - Issue covered by the Tribunal's decision in P.M.
Products Vs. CCE Ahmadabad - Prima-facie case in favor of assessee - Stay allowed
unconditionally. (Para 2, 3)
2015-TIOL-1194-CESTAT-AHM
CCE & ST Vs M/s Rameshwar Textile Mills Pvt Ltd (Dated: December 17,
2014)
CX - Recovery by attachment of property - Take over of property from M/s. Namokar
Processors - At the time of taking over, assessee gave an undertaking to CE
department that all dues of M/s. Namokar Processors will be paid by them - Said
undertaking was not properly appreciated by first appellate authority under which
assessee has clearly agreed to pay the dues pertaining to M/s. Namokar Processors as
and when the issue is decided in favour of department - Nothing in undertaking to
suggest that liabilities arising after undertaking will be paid by assessee - Matter
remanded to first appellate authority: CESTAT [Para 5, 6]
2015-TIOL-1193-CESTAT-BANG
Recon Oil Industries Pvt Ltd Vs CCE, C & ST (Dated: January 06, 2015)
Central Excise - Classification - Coconut oil packed in less than 200 ml containers - Is
edible oil falling under Chapter 15 - Absent stay or reversal of various Tribunal's
decisions laying down that coconut oil packed and sold in packets of capacity up to
200 ml is not liable to excise duty, attempt by Revenue to confirm and demand duty
against appellant is patently illegal - Impugned order set aside - Appeal allowed with
consequential relief. (Para 4-7)
2015-TIOL-1189-CESTAT-DEL
M/s Sahu Refrigeration Industries Ltd Vs CCE & ST (Dated: May 5, 2015)
CX - Penalty - Allegation against assessee is that they have issued invoices but have
not supplied excisable goods to facilitate M/s. Pawan Jain & Sons to avail inadmissible
Cenvat Credit - It is clear from facts that assessee has not dealt with excisable goods
for availment of inadmissible Cenvat Credit by M/s. Pawan Jain & Sons and merely
issued invoices - The provision for person issuing invoices without supply of goods
have come into force for imposition of penalty under Rule 26 of CER, 2002 w.e.f.
01.03.2007 and said provision was not instituted during relevant period - Therefore,
assessee have not dealt with excisable goods - Penalties on both assessees are not
imposable - Consequently impugned order is set aside and appeals allowed: CESTAT
[Para 8, 9, 10]
2015-TIOL-1188-CESTAT-MUM
Shivam Pressings Vs CCE (Dated: February 6, 2015)
CX - Rule 8(3A) of CER, 2002 - Appellant committing default in payment of duty and
not making good the default - SCN issued for recovery of amount, interest and
imposition of penalty - Commissioner(A) confirming demand of duty and interest but
reducing penalty imposed u/r 25 of CER, 2002 - appeal to CESTAT citing the Gujarat
High Co urt decision in Indsur Global - 2014-TIOL-2115-HC -AHM-CX and pleading that
the order be set aside. Held: Hon'ble High Court of Gujarat has only declared ‘without
utilizing the CENVAT credit' in Rule 8(3A) as unconstitutional - all other provisions of
rule 8(3A) have been considered as correct and perfectly legitimate - this would imply
that if assessee defaults in payment of duty beyond 30 days from the due date, the
assessee shall be required to pay excise duty for each consignment at the time of
removal till the date the assessee pays the outstanding amount including interest
thereon and in the event of any failure it shall be deemed that such goods have been
cleared without payment of duty and the consequences and penalties as provided
shall follow - the appellant has not paid the duty consignment wise either through
CENVAT credit account or through PLA - obviously they have violated rule 8(3A) of
CER, 2002 - since appellant has contravened the provisions of rule 25(1)(a) of CER,
2002, the goods cleared during the period are liable for confiscation and the appellant
is liable to penalty not exceeding the duty on the excisable goods - keeping in view
the fact that the duty involved is Rs.7,16,391/ - and also keeping in view the number
of days when the appellant was supposed to clear the goods consignment-wise,
penalty of Rs.3,00,000/- imposed by Commissioner(A) is on the higher side and,
therefore, same is reduced to Rs.50,000/- - Appeal partly allowed: CESTAT [para 4,
4.1, 4.2, 4.3]
2015-TIOL-1180-CESTAT-MUM
CCE Vs Shree Chh Shahu SSK Ltd (Dated: February 6, 2015)
CX - In the Revenue appeal filed against order of Commissioner(A), the amount
involved is less than Rs.5 lakhs - As per litigation policy of the Government vide Board
letter F.No. 390/Misc/163/2010-JC dated 17.08.2011 and the judgments of the
Gujarat & Karnataka High Courts, the appeal of Revenue is dismissed without going
into the merits of the issue: CESTAT [para 2]
2015-TIOL-1179-CESTAT-MUM
Smash Colour Prints And Packaging Pvt Ltd Vs CCE (Dated: March 13, 2015)
CX - Appellant manufacturing printed cartons, catch covers and wallets classifiable
under 4819.19 and chargeable to duty - appellant manipulating invoices by indicating
the correct description of goods on the first and second copy of invoice but in the third
and fourth copy the description was changed so as to give the impression that the
goods being cleared are exempt from payment of duty - inasmuch as first and second
copy indica tes 'cartons' whereas the third and fourth indicated 'folders' - also goods
manufactured by main appellant were shown as manufactured by other units
controlled by the same family - CE duty demand confirmed and penalties etc. imposed
- appeal to Tribunal. Held: Keeping in view that invoices were manipulated, it is a case
of fraud and extended period of limitation is correctly invoked and is upheld; penalty
u/s 11AC of CEA, 1944 and interest is also upheld - amount of duty, interest and
penalty will be required to be quantified in those cases mentioned in Annexure II(B)
where description given in all four copies are 'inserts' which are nothing but leaflets
and not chargeable to duty as being a product of printing industry; claim of CENVAT
credit allowed in interest of justice if duty paying documents produced - Penalties on
other appellants viz. Managing Director/Director etc. are definitely not on the higher
side as they have connived to evade payment of duty and were looking after day-today work and manipula tion of invoices was being done with their active knowledge,
therefore, penalties upheld even after extending the claims for 'inserts' and CENVAT
credit - Appeal disposed of: CESTAT [para 6, 7, 8]
2015-TIOL-1178-CESTAT-MUM
Universal Chemicals And Industries Pvt Ltd Vs CCE (Dated: April 1, 2015)
CENVAT - Rule 2(l) of CCR, 2004 – Input Service - Garden Maintenance Service –
Appellant is a manufacturer of chemicals – it is common knowledge that permission is
granted to a chemical factory by Maharashtra Pollution Control Board subject to
fulfilling the condition of planting number of trees as also to bring under green belt
and for this purpose if the appellant requires or procures the services of a service
provider for garden maintenance service and pays service tax, CENVAT credit on such
amount cannot be denied – Credit admissible: CESTAT [para 4, 4.1]
CENVAT – House Keeping service – services are related to manufacturing activity –
credit of tax paid on such service is admissible: CESTAT [para 5]
2015-TIOL-1177-CESTAT-BANG
Smart Technology Systems Vs CCE & ST (Dated: January 5, 2015)
Central Excise - Fare meters used for taxis and auto rickshaws - Cannot be termed as
parts, components or assembly of taxies - Good prima-facie case in favor of assessee
- Since the appellant had already deposited the entire amount of service tax along
with interest and 35% of the penalty, pre -deposit of balance due is waived. (Para 3,
4)
2015-TIOL-1176-CESTAT-BANG
Tirupathi Udyog Ltd Vs CCE, C & ST (Dated: March 6, 2015)
Central Excise - Cenvat credit - Welding electrodes used for maintenance and repair of
plant - Input eligibility and demand beyon d normal period of limitation - Conflicting
decisions - Matter pending before Larger bench of the Supreme Court - In view of
several decision in favor of assessee for the period in question, appeal succeeds on
point of limitation.
2015-TIOL-1172-CESTAT-MUM
CCE Vs UPM Kymmene India Pvt Ltd (Dated: May 11, 2015)
CX - Cutting and slitting of jumbo rolls of imported self -adhesive film and self adhesive paper as per requirement of customer does not amount to manufacture u/s
2(f) of CEA, 1944 - Assessee could not have paid duty on the same: CESTAT [para 12,
13, 15, 19]
Also see analysis of the Order
2015-TIOL-1169-CESTAT-DEL
CCE Vs Rachitech Engineers Pvt Ltd (Dated: January 1, 2015)
CX - Notfn 6/2002-CE - Assessee are manufacturers of chimneys which are to be used
as component of boilers for non-conventional energy system - No dispute that
chimneys manufactured by assessee are meant for biomass burning boilers being
manufactured by M/s. ISGEC John Thompson who in turn, supply such broilers to endusers for production of energy from waste - Since what is covered by Sl.No.237 of
said Notfn is non-conventional energy devices/systems and since there is very thin
distinction between part and device, as device is thing made for a particular purpose
and since chimney being an integral part of biomass fired boiler can be treated as a
device for non-conventional energy devices/systems, exemption under said Notfn
would be available to chimneys - No merit in Revenue's appeal, same is dismissed:
CESTAT [Para 5, 6]
2015-TIOL-1168-CESTAT-DEL
M/s Salasar Steel And Power Ltd Vs CCE & C (Dated: January 27, 2015)
CX - Assessee are manufacturer of Sponge Iron chargeable to CE duty - M/s Gopal
Steel is a commission agent dealing in iron and steel items - Records recovered from
M/s Gopal Steel indicates sale of several consignments of sponge iron manufactured
by assessee to various customers through him for which he had received commission
- No inquiry has been made with customers mentioned in documents recovered from
M/s Gopal Steel - Similarly, factory premises of assessee had also not been searched
and as such there is no allegation of discrepancy in records of raw material or finished
products - Entire case against assessee is based on records recovered from M/s Gopal
Steel and statements of Shri Gopal Krishna Agarwal but cross -examination of Shri
Gopal Krishna Aggarwal, Proprietor of M/s Gopal Steel has not been allowed Impugned order suffers from violation of principles of natural justice, same is set
aside and matter is remanded to Commissioner for denovo adjudication after
permitting cross examination of Shri Gopal Krishna Aggarwal and considering other
pleas made by them: CESTAT [Para 6]
2015-TIOL-1167-CESTAT-DEL
Shri Suresh Kumar Vs CCE (Dated: February 11, 2015)
CX - Exemption under notfn 5/06-CE - Assessee companies are manufacturers of
footwear and supplying the shoes to Defence organisation at DGS&D rate and retail
price of shoes so supplied is less than Rs. 250/- per pair - Supplies were being made
by availing full duty exemption under said notfn - Only in one case, Director of
assessee company had initially given the statement that price was not being printed
or embossed but he has subsequently retracted his statement - Department has not
recovered any consignment of shoes supplied to Defence organisations on which there
is no MRP printed and as such there is absolutely no evidence that assessee were not
complying with condition of said exemption notfn - Just because shoes were supplied
to Defence organisation, which according to Department are institutional buyers it
cannot be presumed that no MRP had been printed or embossed on footwear Impugned orders denying benefit of said exemption Notfn are not sustainable, same
are set aside and appeals are allowed: CESTAT [Para 6]
2015-TIOL-1165-CESTAT-BANG
Sri Sai Ram Industrial Equipments Pvt Ltd Vs CCE, C & ST (Dated: January 8,
2015)
Central Excise -Extended period of limitation - Confirmation of excise duty by invoking
longer period of limitation, without determining if the activity amounts to manufacture
or not, more so when the appellant was admittedly discharging service tax liability
with the due knowledge of the Revenue - Is unjustified - Since appellant admitted vis à-vis certain manufacturers that having collected service tax from customers but not
deposited with the department, directed to deposit Rs.30 Lakhs. (Para 4)
2015-TIOL-1162-CESTAT-DEL
M/s Jindal Steel And Power Ltd Vs CCE (Dated: April 17, 2015)
CX - Assessee during period July, 2005 to May, 2006 supplied certa in iron & Steel
angles channels Profile to M/s. L&T Ltd. which are made for use in Mega Power Project
of M/s. Jindal Power Ltd. - Goods had been supplied against International Competitive
Bidding at nil rate of duty under Notfn 6/02-CE - No dispute that power project for
which goods have been supplied is an inter state thermal power project of capacity of
1000 Mega Watt and in this regard certificate has been given by Joint Secretary to
Govt. of India, Ministry of Power - When a particular condition prescribed in Notfn
21/02 -Cus. for full customs duty exemption is not applicable and for this reason,
condition cannot be satisfied, its fulfilment cannot be insisted in accordance with
principle of lex non cogit ad impossiblia - Denial of exemption under Notfn 6/02 -CE
and 6/06-CE on the ground that goods imported would not be eligible for customs
duty exemption under Notfn 21/02-Cus. is not correct - Condition of customs duty
exemption which is being insisted is impossible to fulfill as same is not applicable:
C ESTAT
2015-TIOL-1161-CESTAT-MUM
M/s Technocraft Industries (India) Ltd Vs CCE (Dated: April 24, 2015)
CX - Valuation - s.4 of CEA, 1944 - Appellant manufacturing goods on behalf of
principal manufacturer - principal manufacturer supplying black pipes free of cost to
appellant after availing CENVAT credit on such pipes - appellant using such black
pipes in the manufacturing process (i.e galvanisation) and paid duty on his final
product which in turn is used by principal manufacturer for further manufacture Revenue taking a view that value of black pipes should be added for determination of
AV. Held: Issue is decided in favour of appellant by Supreme Court in International
Auto - 2005-TIOL-81-SC -C X-LB and which is followed in Ghatge Patil Industries 2015-TIOL-31-SC -CX - appeal allowed: CESTAT [para 5]
2015-TIOL-1160-CESTAT-BANG
Raghavendra Industries Vs CCE, C & ST (Dated: December 12, 2014)
Central Excise - Clandestine removal of goods - Demand and penalty - No proper
records of inventory of new and old and repaired transformers maintained nor
reconciliation statements supporting the clearances placed - No explanation
forthcoming as to why purchasers had stated that they had purchased new
transformers when they had actually taken old and repaired transformers - Assessee
admitted of clearing new transformers without payment of duty - Further admitted
that statements recorded contain no defence plea of undertaking the activity of repair
and supply - Defence plea taken several years after investigation laid their case, liable
to be rejected - Appeal having no merit deserves to be rejected - H owever the claim
that the amount realized by assessee should be treated as cum -tax amount is justified
- Matter is therefore remanded only to work out the quantum of duty by extending
cum -tax benefit and to rework penalty on that basis. (Para 5)
2015-TIOL-1155-CESTAT-DEL
CCE Vs Sri Rama Steels Ltd (Dated: May 6, 2015)
CX - Availment of CENVAT Credit on melting scrap - It is alleged that assessee have
procured scrap from Delhi but Revenue failed to prove the same with cogent evidence
that same has passed through various barriers particularly from Punjab Barrier of
Sales Tax - No statement of transporters has been recorded to unearth the truth and
payment of all scraps have been made by assessee through account of payee cheques
- In absence of any cogent evidence against assessee, charge of availment of
fraudulent CENVAT Credit on melting scrap on invoices is not sustainable: CESTAT
Differential duty and CENVAT Credit on imported melting scrap - Assessee has availed
concessional rate of duty on condition of end user and produced certificate from
Range Superintendent certifying that imported scrap had been used by assessee in
manufacture of their final product - Said certificate cannot be denied by any authority
in absence of any contrary evidence - Assessee are entitled for benefit of notfns as
they have complied with conditions of notfns and not liable to pay differential custom
duty and cannot be denied CENVAT Credit of CVD paid by them: CESTAT
Clandestine removal on strength of parallel invoices - Revenue failed to produce
source of procurement of parallel invoices, they produced only photocopies - Merely,
statement that they have received these photocopies of invoices from Excise and Tax
Department of Himachal Pradesh, in absence of any documentary evidence, parallel
invoices are no acceptable documents, therefore, duty cannot be demanded on fake
invoices produced by Revenue: CESTAT
2015-TIOL-1154-CESTAT-MAD
M/s Sakthi Sugars Ltd Vs CCE (Dated: February 6, 2015)
Central Excise - Penalty - credit of tax paid on GTA service was availed as input
service for coal brought for power generation - dispute in first round whereupon non
imposition of penalty under Sec 11AC agitated by Revenue resulted in the second
round wherein penalty was imposed.
Held: Cenvat credit law is very complex in nature which has undergone amendment
several time and was difficult to comprehend by a common man - Therefore, in
absence of any finding showing evasion, imposition of penalty on it shall be
unjustified. [Para 5].
2015-TIOL-1153-CESTAT-BANG
Sealed Air (India) Pvt Ltd Vs CCE, ST & C (Dated: March 6, 2015)
Central Excise - Denial of Cenvat - Removal of finished goods from old factory
premises on payment of duty to new premises where credit of duty paid was utilized
and thereafter same goods were cleared after repacking - Process amounts to
clearance of semi-finished goods - No irregularity in the procedure adopted by the
appellant warranting denial of Cenvat credit - Appeal deserves to be allowed. (Para 2)
Central Excise - Availment of CENVAT credit on services used for trading and
manufacture - Trading was not an exempted service during the relevant period in
question - Appellant directed to reverse proportionate credit attributable to trading
activity following the precedent in Orion Appliances Ltd. (Para 3, 4)
2015-TIOL-1152-CESTAT-BANG
Jenious Clothing Pvt Ltd Vs CCE & ST (Dated: January 23, 2015)
Central Excise - Penalty proceedings - Delayed payment of entire defaulted amount Show cause notice issued one year thereafter to impose penalty - In view of the fact
that High Court of Gujarat has taken a view that Rule 8(3A) is ultra vires and
provision of section 11A requires detailed consideration. (Para 3)
2015-TIOL-1151-CESTAT-AHM
M/s Shyam Textile Mills Vs CCE & ST
CX - Whether original value of investment in plant and machinery of assessee is above
Rs. 3 Crore or not for being eligible to voluntary Compounded Levy Scheme under
provisions of Rule 96ZNA to 96ZND (Section - ExA) of CER, 1944 - Assessee filed
required declaration as per provisions of Rule 96ZNB(1) of CER, 1944, which was duly
certified b y Chartered Accountant - Adjudicating authority, on basis of verification
report of Deputy Commissioner, on his own, estimated original value of plant and
machinery as more than Rs. three crores - Adjudicating authority can not sit over
certification done by Chartered Accountant, as per Accounting Standards and decide
value of plant and machinery as per his own verifications got made and best judgment
- After issue of Notfn 32/2001-CE and 41/2001-CE, assessee gave a certificate in
continuation of earlier ce rtification from same Chartered Accountant that valuation of
fixed assets was done as per Accounting Standard.10 (AS-10) - Subsequent certificate
given by Chartered Accountant to that effect can not be brushed aside by adjudicating
authority to hold that he will determine value of plant and machinery himself - Appeal
allowed: CESTAT
2015-TIOL-1149-CESTAT-BANG
Beml Ltd Vs CCE, C & ST (Dated: January 01, 2015)
Central Excise - Cenvat Credit - Dutiable and Exempted goods - Credit attributable to
exempted goods cleared - Failure to maintain separate account and non-exercise of
option as required under Rule 6(3A) - Omission is merely procedural in nature - Predeposit waived. (Para 2)
2015-TIOL-1147-CESTAT-MAD
M/s The Madras Aluminium Co Ltd Vs CCE & ST (Dated: May 12, 2015)
Central Excise - short issue involved in this appeal is whether "Aluminium Dross"
emerging as product is excisable or not.
Held: Issue has already been settled by the Apex Court judgement in the case of
Grasim Industries Ltd., and Bombay High Court decision in Hindalco Industries relying
upon the former - ruling pronounced to the effect that the conditions contemplated
under Section 2(d) and Section 2(f) have to be satisfied conjunctively in order to
entail imposition of excise duty under Section 3 of the CE Act 1944; holding that even
after amendment of Section 2(d) of Central Excise Act, the Apex Court decision is still
valid - impugned order set aside. [Para 3]
2015-TIOL-1146-CESTAT-MAD
Sunbeam Generators Pvt Ltd Vs CCE (Dated: May 13, 2015)
Central Excise - Exemption - appellants are engaged in the manufacture of Diesel
Generating Sets and removed 2 Nos. of Diesel Engine to HCIL without payment of
Central Excise duty by claiming exemption under Notification No.108/95-CE dt.
18.8.1995 based on the certificate issued by Rail Vikas Nigam Ltd., Govt of India Exemption proposed to be denied in SCN, allowed by adjudicating authority, denied by
Commissioner (Appeals) on Revenue's appeal; and agitated herein.
Held: Adjudicating authority in his OIO dropped proceedings by relying on Tribunal's
order in the case of Cater Pillar India Ltd. whereas the Commissioner (Appeals) while
allowing Revenue's appeal observed that Revenue has already filed appeal before the
Chennai High Court - Chennai High Court in turn dismissed the Revenue's appeal by
upholding Tribunal's order - Following the HC order, impugned order set aside.
2015-TIOL-1144-CESTAT-MUM
Vinyl Chemicals Vs CCE (Dated: April 1, 2015)
CX - CENVAT - Input Service - Rule 2(l) of CCR, 2004 - Security Services rendered at
factory premises and Rent-a-cab services hired for marketing staff to sell the products
- it is a settled position of law that both the services are Input Services as they have
nexus with the manufacturing of final product - Credit admissible - appeal allowed:
CESTAT [para 4]
2015-TIOL-1139-CESTAT-DEL
M/s Mahendra Sponge And Power Ltd Vs CCE & ST (Dated: April 30, 2015)
CX - Duty demand on insurance claim - Due to heavy rains, finished goods of assesee
got damaged and they filed claim before insurance company for damaged goods and
received compensation - In remand proceedings there were directions to Revenue also
to tell the assessee under which provision revenue is seeking demand of duty on
insurance claim - Both authorities unable to tell under which provision duty is payable
befo re assessee on insurance claim received for damaged goods - As per Ratnatraya
Heat Exchangers Ltd. 2011-TIOL-1538-CESTAT-MUM , demand is not sustainable:
CESTAT [Para 9, 10]
2015-TIOL-1138-CESTAT-MAD
M/s JSW Steel Ltd Vs CCE & ST (Dated: May 11, 2015)
Central Ex cise - CENVAT credit - issue relates to demand under Rule 6(3)(1) of Cenvat
Credit Rules, 2004 on the clearance of metallurgical coke to their sister unit without
payment of duty.
Held: Appellants have reversed the credit attributable to the quantum of inputs used
in the manufacture of metallurgical coke and also proportionate amount of input
service in their cenvat account and appropriated by Revenue - Consequent to the
amendment of cenvat credit rules with retrospective effect vide Finance Act, 2010, if
the appellants reversed the proportionate credit, question of demanding 'amount'
equivalent to 10% of the value does not arise - impugned order set aside [Para 4]
2015-TIOL-1137-CESTAT-BANG
CCE, C & ST Vs Vijayalaxmi Gears (Dated: February 20, 2015)
CX - Revenue in their memo of appeal has pleaded that the finding of the Tribunal is
improper, erroneous, invalid, illegal and perverse since the same suffers from misconsideration of the provisions of the Rule as well as misconstruing the relevant
circulars issued in this behalf.
Held: Revenue using such language in their memo of appeal against an order of the
Tribunal is not called for and the proper course available is to challenge the orders of
the Tribunal before the higher appellate forums instead of criticizing the said orders by
using improper language - Revenue Appeal rejected: CESTAT [para 3, 4]
2015-TIOL-1134-CESTAT-BANG
Dynamatic Technologies Ltd Vs CCE, ST & C (Dated: March 6, 2015)
Central Excise - Reversal of Cenvat credit attributed to exempted goods - Appellant
fulfilled the obligation cast under section 73 by making payment of proportionate duty
along with interest - Provision does not postulate Commissioner to pass an order that
the amount paid was correct - Absent communication from the Commissioner within
the prescribed two months thereafter, matter is deemed to be considered as finalized
in terms of section 73 - Appeal on ground of shortfall thereafter is not competent Impugned order demanding demand 10% of the amount received by the appellant in
respect of exempted hand-pumps upon fulfilling the mandated obligation, is
unsustainable - Appeal allowed with consequential relief. (Para 6, 7)
2015-TIOL-1130-CESTAT-MUM
B D Industries Vs CCE (Dated: March 19, 2015)
CE - Refund - Appellant had made pre -deposit as per stay order of Tribunal - later O in-A set aside and appeal allowed - appellant having succeeded in appeal claimed
refund of pre-deposit - adjudicating authority sanctioned the claim but in Revenue
appeal Commissioner(A) held that the claim is hit by the doctrine of unjust enrichment
- appeal to CESTAT. Held: Re venue is bound by its own Board's Circular which states
that no refund claim needs to be filed for reclaiming an amount deposited on direction
of appellate authority - appellant also having evidenced through certificate of C.A. that
the amount has not been debited to Profit and Loss account as expenses and which
certificate has not been disputed or controverted - In absence of any contradiction,
question of doctrine of unjust enrichment will not come in the way - Question of
holding back the amount by Revenue does not arise - Impugned order is set aside and
appeal allowed: CESTAT [Para 6.1, 6.3, 7]
2015-TIOL-1129-CESTAT-MUM
Rashtriya Chemicals & Fertilizers Ltd Vs CCE (Dated: May 07, 2015)
CX - Valuation - 40 year old matter - while determining the assessable value in
respect of captively consumed goods, the proper officer has to make reasonable
adjustments taking into consideration all relevant factors - Commissioner(A) should
not place reliance on decisions without discussing as to how the factual situation fits in
with the facts of the decision on which reliance is placed - Matter remanded: CESTAT
[para 4, 6]
Also see analysis of the Order
2015-TIOL-1125-CESTAT-AHM
M/s Heranba Industries Ltd Vs CC & CE (Dated: March 04, 2015)
CX - Assessee had paid excess availment of credit before issue of SCN, and not
contesting demand of said amount - Regarding demand of denial of CENVAT Credit of
Rs.13,71,459.00, assessee had not produced original documents inspite of remand
order and even before Tribunal - During course of hearing, after about 10 years,
assessee just made submission before Tribunal that they have got original documents
- No merit in submissions of assessee, so, demand of Rs. 13,71,459.00 is justified:
CESTAT
CX - Interest - Assessee utilized credit as evident from CENVAT accounts and
therefore, decision relied upon by assessee would not be applicable, hence, demand of
interest is also justified: CESTAT
CX - Penalty - No material found to show that excess availment of credit was made
with intention to evade payment of duty - Nature of availment of excess credit as
revealed from statement of Smt. Beena Thomas, that in some cases, credit availed on
assessable value to extent of Rs.1.04 Crores - Assessee had taken credit twice on
same invoice - Fit case to impose penalty under Rule 15(1) of CCR, 2004 - Penalty on
assessee 1 is reduced to Rs.10 lakhs and on other assessees are set aside: CESTAT
2015-TIOL-1124-CESTAT-MAD
M/s Forder Technik India Pvt Ltd Vs CCE (Dated: February 16, 2015)
Central Excise - manufacture - appellant engaged in erection and installation of heavy
storage racks in the premises of various companies for storage of industrial
engineering goods; items fabricated on piecemeal basis and assembled at site -
Revenue viewed the same amounted to manufacture, attracting excise levy Demands adjudicated and agitated herein.
Held : Nothing on record to show that appellant cleared the goods in piecemeal with
the intention to cause evasion of duty - The components of racks were welded at site
for housing heavy engineering goods therein - mere standing rack on the earth
without being embedded thereto cannot accommodate heavy equipments for the
storage in its bins; such proposition alone calls for holding the goods as immovable
property - appellant although was principal manufacturer of manufactured rack
components, that having been embedded to earth upon welding to fulfill contractual
obligation and such racks became inseparable without causing damage thereto when
detachment is contemplated, that rules out appellant's liability under Central Ex cise
Act, 1944 - Appellant was not mere supplier of goods; It had concurrent liability of
embedding the supplied goods duly to earth to call the same as heavy storage racks
[Para 6, 7]
2015-TIOL-1122-CESTAT-BANG
Agarwal Foundries Vs CCE, C & ST (Dated: March 05, 2015)
Central Excise - Cenvat Credit - Manufacturer of angles and ingots - Expenses
incurred on Air conditioner and furniture installed in the factory - Allowed. (Para 2)
2015-TIOL-1120-CESTAT-DEL
M/s Capital Transformer Pvt Ltd Vs CCE (Dated: April 1, 2015)
CX - Assessee are manufacturers of transformers and beside this, they also undertake
repair of transformers returned to them by their customers - First point of dispute is
regarding Cenvat credit of Rs. 5,31,031/- in respect of demand under Rule 16 of CER
in respect of transformers returned to assessee for repairs - Objection of department
is that CT numbers as recorded in RG-23A register in respect of returned transformers
do not match with CT numbers as mentioned in respective invoices on basis of which
the credit had been taken - Whatever credit has been taken by assessee, same has
been reversed at the time of clearance of repaired goods - Moreover, no credit was
taken of ports used in repair - Assessee has correctly taken the credit - As regards
duty demand o f Rs. 3,92,578/-, when SCN itself mentions, the goods in respect of
which duty has been demanded, as non-excisable goods, fail to understand as to on
what basis duty had been demanded, when difference between ER-1 return figure and
balance sheet figure is on account of sale of non-excisable goods - The finding that
repair of transformers amounts to manufacture is totally wrong finding in respect of
clearance of repaired transformers no duty can be demanded, only Cenvat credit on
cenvated parts used in repairs is required to be reversed - Duty demand of Rs.
3,92,578/- is not sustainable - Cenvat Credit cannot be denied and demand of duty is
not sustainable - Appeals allowed: CESTAT
2015-TIOL-1119-CESTAT-KOL
M/s Bharat Lithographing Co Pvt Ltd Vs CCE (Dated: December 8, 2014)
CX - Assessee engaged in manufacture and removal of excisable goods namely,
Printed Wrappers cut to size falling under Chapter Sub -Heading, 4825.19. of CETA,
1985 - Revenue wants to classified under Chapter Sub-Heading, 4821.00 as 'Label' Assessee vehemently argued that both Units are separate in law and also in fact,
hence, clubbing the clearance of these Units is incorrect - Also that no detailed finding
about their inter-se relationship had been recorded in impugned Order, but
Commissioner on the basis of an earlier Order, had concluded that relationship
between these two assessees we re not at arm's length, and consequently, inferred
that both these Units are one and the same - Allegation of clubbing of clearances
needs to be examined in detail in light of evidences produced by both sides, which
would be possible only at the time of disposal of appeals - Stay granted: CESTAT
[Para 5]
2015-TIOL-1114-CESTAT-MAD
M/s Alstom T & D India Ltd Vs LTU (Dated: March 25, 2015)
Central Excise - Exemption - appellants supplied circuit breakers, control panels and
relays along with mandatory spares under International Competitive Bidding by
availing Notification No.6/2006 dated 1.3.2006 - Demand of CENVAT Credit on
mandatory spares - upheld by Commissioner (Appeals), and agitated commonly
herein.
Held: Issue stands settled by the decision of this Tribunal in the appellant's own case
vide Final Order No. 181 & 182/2012 dated 2.3.2012 and the Revenue has accepted
the said order; following the same, impugned order set aside. [Para 5]
2015-TIOL-1113-CESTAT-DEL
BSN Ltd Vs CCE & ST (Dated: March 25, 2015)
CX - Interest on delayed refund - Assessee has filed refund claims in March/April,
2002 - No Deficiency memo was issued to assessee for different refund claims and
same has been accepted by department - Only on 11.10.2002, SCN has been issued
whereas refund claim has been required to be entertained within three months from
date of filing of refund claim, but nothing was done in three months - As per Ranbaxy
Laboratories Ltd. 2011-TIOL-105-SC-CX , assessee is entitled to claim interest after
three months from date of filing of refund claim till its realization: CESTAT [Para 6]
2015-TIOL-1112-CESTAT-AHM
CCE, C & ST Vs Essar Oil Ltd (Dated: February 24, 2015)
CX - Input service credit denied on Outdoor Catering Service, Rent-a-cab service and
Travel Agent Service - Both the authority below allowed the credit following various
decisions of Tribunal - As per Ultratech Cement Ltd. 2010-TIOL-745-HC -MUM-ST ,
assessee is not eligible to avail the credit on Outdoor Catering Service on employees
Share - Impugned order is modified to the extent the Cenvat Credit on Outdoor
Catering Service is not admissible to assessee: CESTAT
2015-TIOL-1111-CESTAT-DEL
M/s Trimurti Fragrance (P) Ltd Vs CCE (Dated: April 6, 2015)
CX - Pan Masala Packing Machines (Capacity Determination and Collection of Duty)
Rules 2008 - Appellant are manufacturer of retail pouches of Gutkha, Pan Masala
and/Chewing Tobacco and discharged their duty liability - Dispute is in respect of
months of March 2011 and July 2013 - Unit was closed from 1st March 2011 to 16th
March 2011 and had functioned only from 17.03.2011 to 31.03.2011 - For claiming
abatement, it is not necessary that assessee should pay duty for whole month and
that the assessee would be required to pay proportionate duty only for the number of
days for which unit were functioning - Therefore, duty demand is prima facie not
sustainable - Since the appellant had installed 4 new machines on 24.07.2013 for
manufacture of new RSP of Rs. 4 per pouch, the 4th Proviso to Rule 9 of PMPM Rules
would be applicable - Duty would be chargeable on prorata basis for remaining days in
the month i.e., from 24.07.2013 to 31.07.2013, and as such duty demand confirmed
by Commissioner on this basis would not be sustainable - Stay granted: CESTAT [Para
6, 7, 7.1, 8]
2015-TIOL-1110-CESTAT-MUM
M/s Bajaj Healthcare Ltd Vs CCE (Dated: September 24, 2014)
CX - Rule 21 of CER, 2002 - Finished goods destroyed in fire - Remission of duty expression " unavoidable accident" requires to be given a reasonable and liberal
meaning lest the provisions are rendered altogether otiose - fire on account of short
circuit has to be held as covered by the expression - appellant is eligible for claim of
remission of duty: CESTAT
Also see analysis of the Order
2015-TIOL-1102-CESTAT-DEL
CCE Vs M/s Goyal Proteins Ltd (Dated: January 16, 2015)
C X-CENVAT -Rule 6 of CCR , 2002/2004 -Acid oil emerges in the manufacture of refined
vegetable oil and during the manufacture of Dextrose Monohydrate/Dextrose
Anhydrous, a by-product viz. hydrol emerges -By-product Acid oil and Hydrol are
exempted from duty-Respondents have availed cenvat credit in respect of input/input
services used in the manufacture of these dutiable final products and exempted byproducts-Revenue invoking provisions of rule 6 to demand 8% of sale value of
exempted by-products-Commissioner(A) allowing appeals of assessee respondents,
hence Revenue in appeal before CESTAT .
Held: It was impossible for the Respondents to maintain separate account and
inventory of the inputs/input services meant for dutiable final products and exempted
final products as this can be done only if two different final products, one dutiable and
the other exempted are being manufactured consciously-When compliance of a
provision is impossible, an assessee cannot be penalized for his failure to comply with
the same-Lex non cogit ad impossibilia is a well settled legal principle -provisions of
Rule 6(2) read with Rule 6(3)(b) of Cenvat Credit Rules, 2002/2004 would not be
applicable in such cases when in course of manufacture of dutiable final products
some exempted final products also emerge as inevitable by-product-no infirmity in
order of Commissioner(A) -Revenue appeals dismissed: CESTAT [ para 8]
2015-TIOL-1101-CESTAT-MUM
CCE Vs M/s Arvind Cotspin Kolhapur (Dated: March 4, 2015)
CX - Advance licence - Assessee, 100% EOU cleared consignments of cotton yarn in
DTA by paying 8% duty under two release orders - Revenue's case is that the goods
have been cleared in violation of Section 3 of CEA, 1944 and Notfn 82/92 -CE and
assessee is required to pay CE duty equal to aggregate of duties of customs leviable
under provisions of Customs Act, 1962 - Commissioner(A) allowing appeal of assessee
in respect of clearances under one release order and denying the other - Revenue and
assessee were in appeal before CESTAT - Revenue appeal rejected and Assessee
appeal remanded to Commissioner(A) - Commr(A) observing that DGFT had issued
Amendment Sheet whereby the said licence was endorsed for taking benefit of
exemption under Notification No. 30/97-Cus dated 1/4/97; that said notification
provides for full exemption from Customs duty as well as Additional duty; that as the
above two duties are exempted, special Addl. Duty will also be exempted and,
therefore, the entire clearances will be exempted and duty demand will not sustain Revenue in appeal. Held: Issue involved is already decided by the Tribunal in
appellant's own case holding that the status of advance release order is the same as
that of advance licence and Notification No. 30/97 and 82/92 both are to be read
harmoniously, and, therefore, supply made against advance release order should be
treated as eligible for exemption from additional duty of customs also - No merit
found in appeal of Revenue and hence same is dismissed: CESTAT [Para 2, 4]
2015-TIOL-1100-CESTAT-MUM
Balkrishna Paper Mills Ltd Vs CCE (Dated: February 5, 2015)
CX - Appellants are manufacturers of paper and they were paying duty under
notification 4/2006-CE by availing CENVAT credit - Revenue contention is that goods
are covered under sr. no. 90 of the said notification which prescribes Nil rate of duty.
Held: A bare reading of s.5A of CEA, 1944 indicates that a manufacturer will not have
an option to pay the duty only where the goods are exempt and the exemption
granted is "absolute" - in the present case, serial no. 90 has two conditions viz.
limiting exemption for goods cleared for home consumption upto first clearances of an
aggregate quantity not exceeding 3500 MT and the second condition of non-availment
of notification 8/2003-CE - in view of the above mentioned two conditions it cannot be
said that serial no. 90 provides ‘absolute exemption' - Appellant assessees cannot be
forced to pay duty as per serial no. 90 of notification 4/2006-CE and they have the
option to pay duty under other serial numbers viz. 91 and 93 - Appeals of assessees
allowed and Revenue appeal dismissed: CESTAT [para 6, 7, 8]
2015-TIOL-1099-CESTAT-DEL
Trimurti Fragrances Pvt Ltd Vs CCE (Dated: May 7, 2015)
CX - Factory of assessee was closed from 1st March, 2011 to 16th March, 2011 and
had functioned only from 17.03.2011 to 31.03.2011 - Conditions for claiming
abatement under Rule 10 of PMPM Rules are satisfied, that assessee had applied for
rebate and that rebate is admissible - Assessee, instead of paying full duty for March,
2011 had paid only proportionate duty for period from 17th March, 2011 to 31st
March, 2011 - For claiming abatement for period of closure of factory, depositing duty
for whole month is not a pre -condition and that in such cases duty would be required
to be paid only for number of days for which a factory was working - Since due date
for payment of duty was 5th of month and assessee paid duty only on 21.03.2011,
assessee in respect of net duty payable by them, would be liable to pay interest on it
as per provisions of PMPM Rules for period of delay: CESTAT
CX - Assessee had used four new machines installed w.e.f. 24.07.2013 for
manufacture of pouches of new RSP -Rs.4 per pouch, which was not being earlier
manufactured by them, therefore, provisions of Proviso to Rule 9 would be squarely
applicable - Therefore, in respect of these four machines, duty at the rate applicable
for MRP of Rs.4 would be chargeable only for 8 days from 24th July to 31st July and
not for entire month - Assessee have discharged duty liability on this basis only - Duty
demand confirmed against assessee in this regard is not sustainable and has to be set
aside: CESTAT
2015-TIOL-1097-CESTAT-DEL
M/s IPCA Laboratories Ltd Vs CCE (Dated: May 6, 2015)
CX - Assessee used 6 common input services which are used in or in relation to
manufacture of dutiable final product as well as exempted final product - Period of
dispute is from May, 2007 to March 2008 - In view of retrospective amendment
introduced by Finance Act, 2010, assessee were entitled to reverse proportionate
cenvat credit attributable to quantum of input services used in or in relation to
manufacture of exempted final product - Once, assessee have foregone proportionate
cenvat credit in respect of input services used in or in relation of manufacture of
exempted final product, they have to be treated as complied with provisions of sub
Rule (3) of Rule 6 of CCR, 2004 and hence, there cannot be any demand of amount
under Rule 6(3)(b) - Impugned order is not sustainable, same is set aside - Appeal
allowed: CESTAT [Para 6, 6.1]
2015-TIOL-1096-CESTAT-MUM
Ultra Tech Cement Ltd Vs CCE (Dated: March 17, 2015)
CENVAT - Rule 2(l) of CCR, 2004 - Security service received in residential colony and
guest house; pest control service received in employees' residential colony; repair and
maintenance of air coolers in residential colony; maintenance of river pump and
security service received at guest house - appellant claiming CENVAT credit of ST paid
on the above services as being in connection with the activity of manufacturing of
Cement at a remote area - lower authorities denying the credit and, therefore,
appellant before CESTAT. Held: It has been authoritatively held by the Bombay High
Court in the case of Manikgarh Cement - 2010-TIOL-720-HC -MUM-ST that credit is
not admissible on the "services" received at the residential colony - to that extent
appeal fails - however, in respect of appeal E/321/2010 appellant has made out a
case for service tax which is sought to be denied and which is beyond the limitation
period - to that extent, appeal is allowed but demand within the limitation period is
upheld along with interest - CENVAT credit since allowed on water pump, ST paid on
maintenance of such pump is also allowed; ST paid on security service received at
guest house is allowed in view of decision in L'Oreal India Pvt. Ltd. 2011-TIOL-95CESTAT -MUM - since the issue involved is interpretation of provisions, question of
imposition of penalty does not arise - Appeals partly allowed: CESTAT [para 6 to 7]
2015-TIOL-1093-CESTAT-MUM
Maneesh Export (EOU) Vs CCE (Dated: May 18, 2015)
CX - Pre-deposit - Date of SCN and period involved is not relevant - substituted
Section 35F will be applicable to all the appeals filed after the commencement of the
FA, 2014 - since pre -deposit not made of 7.5%, appeals are not maintainable, hence
dismissed: CESTAT [para 4.1, 5, 6.1, 7]
Also see analysis of the Order
2015-TIOL-1092-CESTAT-MUM
M/s R M Dhariwal (HUF) Vs CCE (Dated: April 15, 2015)
CX - Refund, Interest - s.11B, 11BB of CEA, 1944 - Appellant filed claim on
19/02/2009 for refund of Rs.90 lakhs paid by them as pre -deposit as per CESTAT
direction - refund sanctioned on 30/09/2009 - appellant seeking interest on the delay
but denied by lower authorities hence in appeal before CESTAT - sanctioning authority
submitting that appellant filing claim along with self attested copy of TR-6 challan but
what is required is departmental attested copies of TR-6 challan. Held: It is a settled
law that if the refund is delayed beyond three months from the date of filing the
application, revenue is under obligation to grant interest for delayed period - the
sanctioning authority could have asked the appellant to submit attested copies within
the time period of three months which he failed to do - appellant entitled for interest
on refund claim for the period beyond three months from the date of filing application
till sanction of claim - appeal allowed: CESTAT [para 4]
2015-TIOL-1091-CESTAT-MUM
CCE Vs Metro Shoes Pvt Ltd (Dated: November 21, 2014)
CENVAT - Assessee is manufacturer and trader of footwear and ladies purses/bags they are also trading in branded footwear of other companies like Adidas, Reebok,
Liberty etc. - Credit denied of service tax in respect of services which are utilised
beyond the place of removal and also in respect of service utilised in respect of traded
goods either partially or fully - Commissioner(A) relying upon Tribunal's order dated
08.01.2008 in appellants' case - 2008-TIOL-417-CESTAT -MUM and allowing credit in
respect of service tax paid by the service providers and charged to appellant till the
sale of the goods from the retail showroom - however, service tax credit taken by the
assessee in respect of the commission paid to retail agents in relation to branded
trade-in goods which are not manufactured by the appellant was confirmed - Revenue
in appeal against dropped portion of demand. Held: Issue is squarely covered in
favour of respondent assessee by earlier order of Tribunal in assessee's own case Department appeal dismissed - assessee entitled to consequential relief, if any:
CESTAT [para 7]
2015-TIOL-1090-CESTAT-MUM
Metal Temple Pvt Ltd Vs CCE (Dated: May 6, 2015)
CX - Rule 8(3A) of CER, 2002 - Appellant utilizing CENVAT credit during the period of
default - duty paid along with interest - appellant contesting penalty imposed of Rs.6
lakhs under rule 25 of CER, 2002 - Gujarat High Court in the case of Indsur Global Ltd
. - 2014-TIOL-2115-HC -AHM-CX has held Rule 8(3A) of CER, 2002 as unconstitutional
and, therefore, the whole foundation of the present case gets demolished - Penalty
imposed on the appellant does not survive - Penalty set aside and appeal allowed:
CESTAT [para 5, 6]
2015-TIOL-1089-CESTAT-MAD
Eastman Exports Global Clothing P Ltd Vs CCE (Dated: March 10, 2015)
Central Excise - Refund - Appellant, engaged in the manufacture and export of
garments, availed input services credit on various services and claimed refund of the
same under Rule 5 of CCR 2004 - Claims rejected in adjudication on the grounds that
(a) The appellant claimed drawback as well as refund of cenvat credit unutilized; (b)
The unutilised credit relating to the period prior to June 2006 is not admissible for
refund; (c) The appellant having exported the goods under drawback claim, no bond
was executed; and (d) Some of the cenvat credits were availed on the basis of debit
note - Rejection of the refund is agitated herein.
Held : If there was claim of drawback of service tax and such drawback has been
paid, refund of cenvat credit of service tax shall not be allowed - when the drawback
on service tax was not extended before 13.7.2006, claim thereof cannot be presumed
- When there is no provision to disallow refund of the cenvat credit pertaining to
service tax remaining unutilized and carried forward, the High Court of Bombay held
in the WNS Global Service case that in the absence of any distinction in Rule 5 prior to
13.2.2006, appellant cannot be disentitled to claim of refund thereof hence entire
carried forward credit remaining unutilized should be refunded [Para 7, 8]
If the appellant had made double claim, the authority should have brought in clear
terms as to the amount whether claimed for the self-same period - allegation of
double claim is ruled out - if the exports were made under drawback claim of service
tax, then execution of bond shall receive consideration - adjudicating authority to
examine the invoices relating to service tax paid to ascertain whether those were
debit notes or real invoices [Para 9, 10, 11]
2015-TIOL-1083-CESTAT-MUM
M/s Guardian Steels Pvt Ltd Vs CCE (Dated: September 25, 2014)
CX - Appellant have disclosed the clearance of "Mill scale powder/iron ash" clearly in
ER-1 returns and claimed Nil rate of duty under notification no. 4/2006-CE - Appellant
had also reversed @10%/5% under Rule 6(3) of CCR, 2004 as pointed out by Audit Department seeking to deny the exemption and demanding CE duty - lower
authorities confirming demand after appropriating amount reversed under rule 6 appeal to CESTAT. Held: There is no suppression established on the part of the
appellant - It is the duty of the department to verify the eligibility of exemption
claimed by the appellant and determine whether the credit has been reversed or not Extended period of time is not atracted - Penalty u/s 11AC of CEA, 1944 set aside Appeal allowed in part with consequential relief: CESTAT [para 6]
2015-TIOL-1078-CESTAT-MUM
M/s Trident Nariman Point Vs CCE (Dated: September 29, 2014)
CENVAT - Furnace oil used in hotel for generating steam which is used partly for
manufacture of dutiable cakes, pastries, cookies & chocolates and also used in
laundry, heating water supplied to hotel rooms - Credit deniable to the extent used in
other than manufacture - as there is no suppression or fraud, penalty not imposable
u/s 11AC - Appellant has already reversed CENVAT credit - Interest payable till the
date duty was deposited or CENVAT Credit reversed - Appeal partly allowed: CESTAT
Also see analysis of the Order
2015-TIOL-1077-CESTAT-MUM
Total Oil India Pvt Ltd Vs CCE (Dated: April 17, 2015)
CX - Loss of goods in floods - in terms of proviso clause (a) of section 35B(1) of CEA,
1944, appeal against the order of Commissioner(A) does not lie before the Tribunal
but before the Revisionary authority - Appellant concedes the said legal position but
requests liberty be granted for filing revision application before appropriate forum.
Held: When the case involved is loss of goods, appeal does not lie before Tribuna l appeal dismissed as non -maintainable with liberty granted to appellant to file revision
application before Revisionary authority in terms of s.35EE of CEA, 1944: CESTAT
[para 3]
2015-TIOL-1076-CESTAT-MUM
Kamalakshi Finance Corporation Ltd Vs CCE (Dated: April 22, 2015)
CX - Refund - Self-adhesive PVC insulation tapes were cleared by appellant under
protest by paying @25% BED & 5% SED as classification ordered by AC, CEX under
heading 39.19 whereas the assessee sought classification under heading 85.46 @15%
& 5% SED - matter finally settled in favour of appellant and they filed refund claim refund sanctioned but transferred to Consumer Welfare Fund u/s 12C of CEA, 1944 on
the ground of unjust enrichment - as appellant failed to establish before the
Commissioner (A) that the amount of excise duty is not borne by them, rejection
order upheld - appeal before CESTAT. Held: Only contention of the appellant is that
during the period they were paying 25% duty and 15% duty, price remained the same
and this proves that they have not passed on the burden of duty - When the goods
were manufactured and cleared, the duty rates indicated in the invoices were 25%
and the said amount was collected from the ultimate consumer - Under the
circumstances, it cannot be said that the incidence of duty has not been passed on to
the ultimate consumer and was borne by the appellant - no merit in appeal, he nce
dismissed: CESTAT [para 3, 4]
2015-TIOL-1075-CESTAT-MUM
Bunty Foods (India) Pvt Ltd Vs CCE (Dated: April 7, 2015)
CX - Appellant manufacturing biscuits which are exempt from payment of duty appellant availing CENVAT credit on the inputs used in manufacture of such biscuits Revenue of the view that since biscuits were exempt, appellants are not eligible for
availing CENVAT credit even if goods are exported - appeal to CESTAT. Held: Issue is
already settled in favour of appellant by the Bombay High Court decision in Repro
India Ltd. - 2007-TIOL-795-HC-MUM-CX - Appeals allowed with consequential relief:
CESTAT [para 3, 4]
2015-TIOL-1069-CESTAT-MUM
M/s Mahanagar Gas Ltd Vs CCE (Dated: February 25, 2015)
CENVAT - Debit note is at par with the documents prescribed under Rule 9(1) of
Cenvat Credit Rules, 2004 - There is no dispute raised by the department that the
service were received and same was accounted for in the books of account of the
appellant - debit note containing all the details as required under the rule 9(2) of CCR,
2004 is valid document - appellant is entitled to take Cenvat credit on the debit note Order set aside and appeal allowed: CESTAT [para 5]
2015-TIOL-1061-CESTAT-MUM
M/s Adf Foods Ltd Vs CCE & C (Dated: March 10, 2015)
CENVAT - Refund - Rule 5 of CCR, 2004 r/w notification 5/2006-CE(NT) - for the
quarter ending June, 2007 claim was filed on 04.07.2008 - Refund filed after statutory
time limit of one year from the date of export is not admissible being time barred contention of appellant that refund of accumulated CENVAT credit is neither claim of
duty paid on export goods nor claim of duty paid on excisable materials used in the
manufacture of export goods and hence provisions of s.11B is not applicable is not
tenable i n view of ruling of Madras High Court in case of GTN Engineering (I) Ltd.
2012-TIOL-369-HC -MAD-CX - order of Commissioner (A) is sustainable and same is
upheld - appeal dismissed: CESTAT [para 6]
2015-TIOL-1060-CESTAT-MUM
Air Pac Filters & Systems Pvt Ltd Vs CCE (Dated: April 17, 2015)
CENVAT - Appellant availed credit in respect of beams and angles which were not
received in their factory premises but were used outside for the production of
structures which are finally exported - Adjudicating authoirty confirming demand of
Rs.85,599/-, interest and penalty of Rs.21,400/- - In revenue appeal, the penalty was
enhanced to Rs.85,599/- and appeal of assessee was dismissed - assessee appeal
before CESTAT. Held: When the final product of the appellant was decided to be
manufactured on job work basis by the job worker, the input need not come to the
factory of the appellant and in any case it has to be supplied to the job worker - no
dispute that the inputs were purchased by the appellant and the goods were exported
- appellant is legally entitled to avail credit - finding of Commissioner(A) is against the
settled legal position and hence not sustainable - appeal allowed: CESTAT [para 5 to
7]
2015-TIOL-1058-CESTAT-MUM
Cyan Formulators Pvt Ltd Vs CCE (Dated: April 21, 2015)
CX - s.35 of CEA, 1944 - Appeal filed before Commissioner(A) beyond the condonable
period of 30 days - as held by the Supreme Court in the case of Singh Enterprises
2007-TIOL-231-SC-C X when the statute prescribes a particular period of limitation the
same cannot be condoned even by the Supreme Court as that would render a specific
provision providing for limitation rather otiose - no reason to interfere with the order
of Commissioner(A) dismissing the appeal - appeal and stay petition dismissed:
CESTAT [para 4, 5]
2015-TIO L-1058-CESTAT-MUM
M/s Sound Tracks Vs CCE (Dated: March 17, 2015)
CX - Valuation - s.4 of CEA, 1944 - Recorded Audio cassettes - Revenue alleged that
the transaction/sale between appellants and individual music company was not at
arms length and hence the price at which the appellant sold the goods to music
companies was not acceptable - Tribunal upholding order on merit but remanding the
case to adjudicating authority for re -working of duty and penalty particularly for the
reason that cost of pancake, magnetic tape has to be amortized with number of copies
of existing tapes - said order of Tribunal not challenged further by appellant - in
denovo adjudication Commissioner once again confirmed the demand of
Rs.1,00,408/- and imposed penalty and interest by holding that duty was worked out
after amortizing cost of master cassettes pancake over the number of cassette tapes
made and hence the duty already worked out does not call for any interference above fact not challenged by appellant - confirmation of duty demand is absolutely in
order and does not require any interference - order upheld and appeal dismissed:
CESTAT [para 5]
2015-TIOL-1057-CESTAT-MUM
Bhor Industries Ltd Vs CCE (Dated: April 24, 2015)
CX - Refund - PVC insulated tapes were manufactured by Kamalakshi Finance
Corporation Ltd. on behalf of appellant - Revenue classified the same under Heading
3919 attracting BED @25% whereas Kamalakshi Finance Corpn. Ltd. classified it
under Heading 8546 @15% BED - matter finally decided by classifying under Heading
8546 - consequently appellant filed a refund claim but the same was rejected besides
other things, on limitation - appeal before CESTAT. Held: It is not in dispute that the
appellant has filed refund claim much after the time limit prescribed under the law appellant claiming that since Kamalakshi Finance had paid duty under protest the
same would be applicable to them too - Supreme Court in the case of Allied
Photographic s - 2004-TIOL-27-SC -CX has held that the decision of the Division Bench
in case of National Winder - 2003-TIOL-43-SC-CX holding that if duty is paid by a
manufacturer under protest then the limita tion of six months will not apply to a claim
of refund by purchaser is per incuriam - in view of the same, there is no merit in the
contention of the appellant that the refund claim has been filed within the prescribed
time limit - question of locus standi of appellant as well as doctrine of unjust
enrichment not gone into - appeal dismissed: CESTAT [para 6, 7]
2015-TIOL-1055-CESTAT-MUM
CCE Vs JCB India Ltd (Dated: May 18, 2015)
CX - s.35B of CEA, 1944 - Matter relates to rebate of duty of excise on goods
exported - against order of Commissioner(A), appeal filed before the CESTAT is not
maintainable as Tribunal does not have jurisdiction to entertain the same - Revenue
at liberty to file appeal before appropriate forum: CESTAT [para 3]
Also see analysis of the Order
2015-TIOL-1050-CESTAT-MUM
CCE Vs M/s Vip Industries Ltd (Dated: April 07, 2015)
CENVAT - Rule 2(l) of CCR, 2004 - Services of Gardening - as gardening is essential
under Pollution control laws to maintain quality of ambient air the same is necessarily
business related expenses for the manufacturer - Credit admissible - Revenue appeal
dismissed: CESTAT [para 2]
2015-TIOL-1049-CESTAT-MUM
Sony Dadc Manufacturing India Pvt Ltd Vs CCE (Dated: April 06, 2015)
CE - Appellant engaged in replicating certain Microsoft software on CDs/DVDs and
clearing the goods without payment of duty by claiming exemption in terms of s.no.
27 of notification 6/2006-CE - Revenue denying exemption by holding that the said
entry covers any customized software other than packaged software or canned
software - appeal to CESTAT. Held: Prima facie applicant does not have any case on
merits as the work of replicating and that also in large quantities will not be relating to
customized software - such software has been developed by Microsoft and are used in
computer system by various O.E manufacturers and other customers - in such a
situation, software cannot be called ‘customized software' so as to be entitled for
benefit of exemption notification 6/2006 -CE - applicant will be required to pay duty on
the said goods - royalty is a contentious issue and will be gone through at the time of
final hearing - applicant directed to deposit an amount of Rs.50 lakhs and report
compliance: CESTAT [para 4, 6]
2015-TIOL-1048-CESTAT-DEL
M/s Meneta Automotive Components Pvt Ltd Vs CC & ST (Dated: March 18,
2015)
CX - Assessee, 100% EOU engaged in manufacture of an automobile part chargeable
to CE duty - In course of manufacture of Anti Noise Shims from HR Coils, Steel waste
arises, entire quantity of which was being cleared into DTA - As regards to calculation
of education cess and S&H cess, issue stands settled in favour of a ssessee by Larger
Bench judgment of Tribunal in case of Kumar Arch Tech Pvt. Ltd. 2013-TIOL-614CESTAT -DEL -LB - Part of duty demand based on this issue is not sustainable and has
to be set aside: CESTAT
Exemption from Basic Customs Duty under Notfn 21/02-CUS (SI. No. 200) - If some
goods imported into India are fully and unconditionally exempt from Basic Customs
Duty by some exemption notfn, while calculating CE Duty leviable on DTA clearances
of those goods, Basic Customs Duty would have to be taken as nil, even if those DTA
clearances are not in accordance with conditions prescribed in para 6.8 of FTP - As per
Indo Deutsche Trade Links 2014-TIOL-925-CESTAT -MAD , nature of scrap cannot be
determined on basis as to whether it has been sold to actual users or dealers, as only
use to which Iron and Steel Scrap can be put, is by melting the same to make some
other Iron and Steel products - Part of impugned order confirming duty demand on
basis of denial of exemption under Notfn 21/02-CUS in respect of Basic Customs Duty
is not sustainable and same has to be set aside: CESTAT
Since on goods sold into DTA, VAT has been paid, conditions of exemption Notfn
102/2007-CUS as applicable to DTA clearances of 100% EOU, have been substantially
satisfied and hence goods would be fully exempt from SAD as benefit of notfn cannot
be denied in respect of DTA cleara nces of a 100% EOU if condition as applicable
mutatis mutandis to DTA sales are satisfied - Duty demand based on this issue is also
not sustainable: CESTAT
2015-TIOL-1047-CESTAT-MUM
M/s Indian Oil Corporation Ltd Vs CCE (Dated: February 25, 2015)
CE - Appellant took CENVAT credit of Education Cess paid on Basic Customs duty
which is inadmissible - on being pointed out by Audit, appellant reversed the same
along with interest - since the appellant without contesting and without protest paid
the wrongly availed credit along with interest, their case is squarely covered by subsection (2B) of section 11A of CEA, 1944 and according to which Revenue should not
have issued SCN - consequently penalty should not have been imposed - Payment of
CENVAT and interest is upheld but Penalty not sustainable - Appeal partly allowed:
CESTAT
2015-TIOL-1046-CESTAT-MUM
CCE Vs Genom Biotech Pvt Ltd (Dated: April 25, 2015)
CE - Refund - Rule 5 of CCR, 2004 - Refund of the amount of service tax paid on the
services of commission agent who was rendering the services to the assessee for the
sale of goods abroad is not admissible as service rendered by the commission agents
not being analogous to the activities mentioned in the definition of Input service rule
2(l) of CCR, 2004, would not fall within the ambit of the expression "activities relating
to business" - issue is no more open for agitation in view of Gujarat High Court
decision in Cadila Healthcare Ltd. - 2013-TIOL-12-HC -AHM-ST - Order of
Commissioner(A) allowing refund set aside & Revenue appeal allowed: CESTAT [para
5, 6, 7]
2015-TIOL-1045-CESTAT-MUM
Candico (I) Ltd Vs CCE & C (Dated: April 06, 2015)
CE - Valuation - s.4 of CEA, 1944 - Appellant is a manufacturer of confectionery items
which are sold from depot - appellant clearing goods on Transaction Value u/s 4 of
CEA, 1944 and was recovering freight amount incurred from factory to depot from
their customers but was not including the same in the T.V. Held: Appellant has no
case on merits as duty is required to be paid inclusive of freight amount - issue of
another SCN for the same period demanding duty u/s 4A of CEA, 1944 does not affect
the present SCN - question of invoking extended period of time is a matter of fact and
law combined together and will have to be gone through at the time of final hearing keeping in view the financial condition, applicant directed to deposit 25% of the duty
demanded, minus duty already deposited, in cash: CESTAT [para 4]
2015-TIOL-1043-CESTAT-MUM
Godfrey Phillips India Ltd Vs CCE (Dated: March 26, 2015)
CE - Duty on cigarettes for the period 17/03/2012 to 27/05/2012 - unless the
amendment moved to the Finance Bill, 2012 on 07/05/2012 to replace the 10% ad
valorem rate of duty with specific rate was made effective from 17/03/2012 by
declaration under the Provisional Collection of Taxes Act, 1931, effective date of
enhancement would be date of enactment of the Finance Bill, 2012 i.e 28/05/2012
and not from 17.3.2012 - Provisional Collection of Taxes Act, 1931 does not provide
for recovery of any dues when the rates are amended upwards subsequent to the
introduction of the bill - Dispute squarely covered by Board Circular 981/5/2014-CX
dated 11.2.2014 - Demands set aside & Appeals allowed: CESTAT [para 2, 5]
2015-TIOL-1040-CESTAT-DEL
Jaiswal Industries Vs CC, CE & ST (Dated: January 9, 2015)
CX - SSI exemption - Assessee are manufacturers of PVC pipes chargeable to CE duty,
raw material for which is PVC granules - Appellant during period of dispute had
neither taken CE registration nor were paying duty, claiming that their clearances are
fully within SSI exemption limit - Challan book recovered from factory shows that the
clearances during period 06.05.2011 to 18.10.2011 had exceeded the SSI exemption
limit and duty involved on these clearances would be at least Rs.10.00 to 12.00 Lakhs
- Though duty demand cannot be confirmed merely on the basis of power
consumption, challan book indicates that the value of clearances of assessee unit may
be far in excess of SSI limit - Assessee is directed to deposit Rs.25.00 Lakhs for
compliance with provisions of section 35 F of CEA, 1944: CESTAT [Para 6]
2015-TIOL-1039-CESTAT-BANG
CCE, ST & C Vs Indian Oil Corporation Ltd (Dated: March 5, 2015)
Central Excise - Motor Spirit - Sanction of refund by Commissioner (A) - Appeal
against - Omission to declare assessee's intention of availing concessional rate of duty
to the department prior to obtaining motor spirit and obtaining the registration
certificate thereafter - Whether disentitles to claim refund - Held on facts, that
findings of the Commissioner that the issue as to whether without following procedure
prescribed under the Rules disentitles assessee to claim the benefit or not and that
that procedure relating to registration was held to be unnecessary has already
attained finality without being challenged - Further more as there was no change in
the price, Commissioner (A) rightly viewed that there was no unjust enrichment Revenue appeals lack merit hence rejected. (Para 5, 6)
2015-TIOL-1032-CESTAT-BANG
CCE, C & ST Vs Jindal Stainless Ltd (Dated: December 12, 2014)
Central Excise - CENVAT credit of duty paid on MS Plates, Sheets, Angles, Rounds Used in conjunction with certain capital goods/machinery for maintenance of
machinery - Admissible - No infirmity in the order of Commissioner (A) allowing credit
- Revenue appeal has no merit as such is rejected. (Para 6, 7)
2015-TIOL-1031-CESTAT-DEL
M/s J J Packagers Pvt Ltd Vs CCE (Dated: January 28, 2015)
CX - HDPE Caps - Duty demanded on 30,23,345 HDPE Caps alleged to have been
cleared without payment of duty during period 1999-2000, 2001-2002 - Details about
these clearances had been supplied by appellant company himself - Appellant have
submitted job work challans and job work records, that same had been manufactured
on job work basis, out of raw material supplied by principal manufacturer and had
been returned to them under job work challans - Matter remanded to original
adjudicating authority for de novo adjudication: CESTAT
CX - Confiscation - HDPE waste being meant for recycling and also exempt from duty
under notfn 67/95-CE had not been be accounted for in RG-1 register and hence,
confiscation is set aside - Unaccounted raw material cannot be confiscated under Rule
25 and as such confiscation of HDPE Granules is also not sustainable - HDPE caps
were in fully finished condition and same had not been accounted for in RG-1
Register, same had been correctly confiscated - Redemption fine is reduced to Rs.
20,000/- and penalty is reduced to Rs. 5,000/-: CESTAT
2015-TIOL-1030-CESTAT-DEL
J K Lakshmi Cement Ltd Vs CCE & ST (Dated: March 25, 2015)
CX - Assessee utilized their cenvat credit account for payment of output transportation
service - Revenue sought to deny utilization of cenvat credit account for payment of
output transportation service and relied on CBEC Circular 97/8/2007 - Period in
dispute is March, 2006 to March, 2007 and CBEC has issued said Circular only on
23.08.2007 which is after the period in dispute - Therefore, said circular have no
relevance to facts of this case - It is not in dispute that assessee has paid ST by
availing cenvat credit as well as in cash - Suo moto credit can be taken by assessee of
duty paid twice or excess - Appeal allowed: CESTAT [Para 7, 9, 10]
2015-TIOL-1029-CESTAT-MAD
M/s JSW Steel Ltd Vs CCE (Dated: November 7, 2014)
Central Excise - CENVAT credit - appellants are manufacturers of "Iron and Steel" and
availed 100% MODVAT credit on the item "Runner Mass" - Revenue viewed the
impugned item (runner mass) is not an input for manufacture of final products but it
is used in the runner path of the blast furnace; and that it is a capital good - demand
for recovery of excess availed 50% credit confirmed with interest and penalty, upheld
by Commissioner (Appeals), and agitated herein.
Held: Runner mass is used only in the runner path which is located outside the blast
furnace ie., from the mouth of the blast furnace to the ladle; hence it cannot be
considered to be a part of the blast furnace - The 'runner mass' is coated on the flow
path of the runner path which aids smooth flow of the molten metal and is only
applied on the runner path; the same cannot be considered as part of the blast
furnace ie.(capital goods) - Apex Court decision in the Escorts Mahle case is squarely
applicable to the facts of the present case where the runner mass is not even used
inside the furnace but it is used in the runner path which allows smooth flow of the
molten metal - therefore, the credit availed by the appellants as inputs is valid appellants are eligible to avail 100% credit on the 'runner mass' as inputs - the
impugned order is set aside. [Para 5, 6, 8]
2015-TIOL-1028-CESTAT-MAD
Hinduja Foundries Ltd Vs CCE (Dated: March 20, 2015)
Central Excise - Stay / dispensation of pre deposit - CENVAT credit - issue relates to
denial of capital goods credit on the spare parts, purchased for replacement of the
damaged parts caused due to a fire accident in 2006.
Held: Impugned credit was disallowed only on the premise that the original equipment
was purchased in 1991 where no credit scheme was in force - Prima facie, no such
provision in Cenvat rules for denial of capital goods credit on the parts imported for
replacement, particularly during that period original equipments were not covered
under modvat scheme - Compensation scheme from the insurance company has no
relevance for availment of credit on capital goods purchased in 2006 - appellants have
made out a case for waiver of predeposit of demand in question; predeposit of dues
arising out of the impugned orde r is waived and recovery thereof stayed during
pendency of appeal. [Para 4]
2015-TIOL-1025-CESTAT-DEL
CCE & ST Vs M/s Asim Enterprises (Dated: January 19, 2015)
CX - M/s Vipul Steel & Agro Industries had not challenged Adjudication order in
respect of demand of MODVAT Credit - Registered dealers, the assessees, took the
stand before Adjudicating Authority that they supplied material to M/s DCM
Engineering Products - Proceedings against M/s DCM Engineering Products was
dropped by Adjudicating Authority - As regards imposition of penalty on registered
dealers, revenue's appeal rejected - Regarding penalty on Shri Pramodhan Singh,
Authorised Signatory of said unit, Adjudicating Authority has already imposed penalty
on said unit under Section 11AC of CEA, 1944 - It is noted that Shri Pramodhan Singh
is an employee of said unit and separate penalty on Authorised Signatory is not
warranted: CESTAT
2015-TIOL-1024-CESTAT-MUM
Dy. Chief Manager, (Printing & Stationery), Central Railway Vs CCE (Dated:
May 6, 2015)
C X- Rs.12 crores CX duty demand on CR Printing Press - Goods being printed with
name and details of Central Railway is not capable of being bought and sold for
consideration hence the same is not marketable goods - product in question are not
dutiable on both counts of classification as well as marketability - appeals allowed with
consequential relief: CESTAT [para 5]
Also see analysis of the Order
2015-TIOL-1019-CESTAT-DEL
M/s Birla Corporation Ltd Vs CCE & ST (Dated: April 21, 2015)
CX - Assessee received certain inputs from a 100% EOU for use in manufacture of
their finished product which were cleared by 100% EOU on payment of duty in terms
of proviso to section 3(1) of CEA, 1944 read with Exemption notfn 23/03-CE - In
terms of said proviso, though excise duty paid by 100% EOU on its DTA clearances,
has a basic custom duty component also, cenvat credit is admissible only of Additional
Customs Duty portion payable on goods under section 3(1) of CTA, 1975 plus SAD
payable under section 3(5) of CTA and Secondary and Higher Education Cess - Thus,
DTA unit would not be entitled for cenvat credit of basic customs duty - Assessee is
directed to deposit an amount of Rs. 1.5 Lakhs: CESTAT
2015-TIOL-1018-CESTAT-DEL
M/s BSNL Vs CCE (Dated: April 15, 2015)
CX - Whether assembly, installation and commissioning of switching system along
with power plant and inverter would amount to manufacture - There is no dispute that
assessee have purchased switching systems - Main component of a telephone
exchange is switching system which is an electrical apparatus for line telephony Power plant and inverter are only auxiliary equipments - Power plant supplies 48V DC
current for functioning the switching system and inverter is required for standby
period in case of power break down - Thus, goods which have been purchasedSwitching systems have remained switching systems only even after installation and
no new commodity with distinct commercial identity or character or use has emerged
- Impugned orders are not sustainable, same are set aside - Appeals allowed: CESTAT
2015-TIOL-1017-CESTAT-MAD
M/s Aurobindo Pharma Ltd Vs CCE (Dated: March 6, 2015)
Central Excise - CENVAT credit - availment of credit earned by one unit by another
unit of the same company is under dispute herein.
Held: The basic principle of Cenvat credit being to avoid cascading effect, genuine
credit earned by one unit is not disallowed for set off against liability of other in
absence of any prohibition thereto by law - Ratio of Karnataka High Court ruling in
ECOF Industries applicable, subject to caveat that the manner of distribution of credit
should not be contrary to Rule 7 of the Cenvat Credit Rules, 2004. [Para 4]
2015-TIOL-1016-CESTAT-MAD
M/s L G Balakrishnan & Bros Ltd Vs CCE (Dated: March 13, 2015)
Central Excise - CENVAT credit - Appellant availed capital goods credit as per invoice
value, but at the time of removal of the capital goods they have reversed the credit as
per the transaction value - demand for recovery of differential credit with equal
penalty adjudicated, upheld by Commissioner (Appeals), and agitated herein.
Held: In view of the Tribunal's LB decision in the Navodaya Plastic Industries case, the
appellants are eligible for depreciation on the value of capital goods as per Board's
Circular dated 01.07.2002 - appellant has already paid the differential credit as per
depreciation formula given in the said Board's Circular - Since they have paid the
differential amount and interest before adjudication, there is justification for waiver of
penalty [Para 5]
2015-TIOL-1015-CESTAT-MAD
CCE Vs Vishnu Paper Products Pvt Ltd (Dated: March 19, 2015)
Central Excise - CENVAT credit - adjudicating authority confirmed the demand for
recovery of ineligible cenvat credit with interest and imposed penalty equal to the
demand under Rule 13 of Cenvat Credit Rules, 2002 read with Section 11AC of the
Central Excise Act, apart from penalty under Rule 13 of CCR 2002 - lower appellate
authority vide impugned order partly upheld the order to the extent of credit availed
on the capital goods and penalty in respect of simultaneous availment of cenvat credit
and depreciation from Income Tax on the ground that they have produced revised IT
returns for the years 2000-01 and 2001-02 and original return for 2002-03 - Revenue
filed appeal against that portion order of the Commissioner (Appeals) remanding the
case to the lower authority on the simultaneous availment of cenvat credit and
deprecia tion.
Held: Short issue in this appeal is simultaneous availment of modvat credit as well as
claiming depreciation under the Income Tax Act - clearly brought out in adjudication
order that respondent filed declaration under Rule 4 (4) of CCR; that they ha ve not
claimed any depreciation; that respondents have not claimed depreciation in their IT
return for the year 2001-02 on that part of the value representing duty on the capital
goods - facts are clearly discussed by the adjudicating authority in his orde r;
therefore, it is evident that appellate authority remanded the case to the original
authority only on the ground that respondents have filed revised returns without any
discussion - Karnataka HC in Suprajit Engineering case clearly held that once the
assessed claimed depreciation under Income Tax Act, he is not eligible for cenvat
credit even if they have filed revised returns - Division bench of Tribunal in Gujarat
Alkalies & Chemicals held that when an assessee claimed depreciation and also
availed mod vat credit, he is not eligible to avail credit - impugned order set aside and
OIO restored. [Para 6]
2015-TIOL-1009-CESTAT-DEL
Pearl Drinks Ltd Vs CCE (Dated: February 26, 2015)
CX - Assessee is a manufacture of aerated water and during the period 10.10.2000 to
7.3.2003, they procured sugar from first stage dealer of manufacturer of sugar Whether assessee is entitled to take Cenvat credit on invoices issued by first stage
dealer for period 10.10.2000 to 7.3.2003 - Dispute of availment of Additional Excise
Duty paid prior to period 1.3.2003 and same issue was before High Court of Delhi in
assessee's own case wherein period was 1.4.2000 to 9.10.2000 i.e. prior to 1.3.2003,
wherein Commissioner (A) has held that invoices issued by first stage dealer for
payment of AED, assessee is entitled to take Cenvat credit - CBEC circular
700/16/2003 clarifies the same that if AED has been paid prior to 1.3.2003, same can
be utilized for payment of subsequent period after 1.3.2003 - Assessee has correctly
taken Cenvat credit - impugned order is set aside and appeal allowed: CESTAT [Para
2, 8]
2015-TIOL-1008-CESTAT-DEL
Veena Industries Ltd Vs CCE & ST (Dated: January 13, 2015)
CX - Only basis of duty demands against assessee is that during the pe riod of default
beyond 30 days from due date, the assessee were required to pay duty on clearances
during that period without utilizing Cenvat credit - As per Indsur Global Ltd. 2014TIOL-2115-HC-AHM-CX , condition contained in sub-rule (3A) of Rule 8 of CER, 2002
regarding payment of duty without utilizing Cenvat credit during the forfeiture period
till the assessee pays the outstanding amount including interest is unconstitutional
and, therefore, the portion "without utilizing the Cenvat credit" in sub-rule (3A) of
Rule 8 shall be rendered invalid - Stay granted: CESTAT
2015-TIOL-1007-CESTAT-DEL
M/s Vikrant Auto Industries Vs CCE (Dated: March 25, 2015 )
Central Excise - Stay / dispensation of pre deposit - Rule 8(3A) of CER 2002 Appellant paid duty for Apr 2012 partly from PLA and partly from cenvat account Since the forfeiture period had started from 06.06.2012 which continued till
18.12.2012, the Department was of the view that during this period the duty in
respect of all the clearances made should have been made paid through PLA without
utilizing the cenvat credit; that they must pay this duty through PLA and once they
pay this duty through PLA, they can make a reverse entry in the cenvat credit account
- demand adjudicated with interest and penalty and agitated herein - Stay order dated
26.11.2014 passed with directions to pre deposit the duty demand and reverse the
credit, in terms of the Uniroll ruling - miscellaneous application filed, praying for
modification of the same in terms of the Indusar Global ruling.
Held: Madras HC in the Uniroll case held that when the failure to discharge monthly
liability for a particular month continues the period of one month from the due date,
the provisions of Rule 8(3A) become applicable and in terms of the provision of this
sub-rule, the duty in respect of the clearances made during such period, would be
required to be paid through cash without utilizing the cenvat credit - The Uniroll ruling
had not gone into the question of constitutionality of this provision, while Gujarat High
Court in the case of Indusar Global has gone into the question of constitutionality of
this provision and has held that Rule 8(3A), applicable for period of default beyond the
period of one month from the due date, the payment of duty without utilizing the
cenvat credit, is unconstitutional - On the question of constitutionality of the provision
of Rule 8(3A) there is no contrary judgment of any other High Court and, therefore,
the Indusar Global would be binding on this Tribunal and in view of the Larger Bench
judgment of the Tribunal in the case of Hindustan Lever Ltd, the stay order dated
26.11.2014 would be treated as suffering from a mistake apparent from record which
would need rectification [Para 5]
One of the grounds raised in the appeal was that there was no intention on the part of
the appellant not to discharge full duty liability for April 2012 inasmuch as while the
shortfall in payment was to the extent of Rs. 2 Lakh, at that time they had cenvat
credit balance amount of Rs. 3.3 Lakh - though this point had been raised in the
grounds of appeal but the same had not been considered - keeping in view the
Gujarat High Court in the case of Indusar Global Ltd., the appellant have prima facie
case in their favour - Accordingly, the pre -deposit of the duty demand, interest and
penalty is waived for hearing of the appeal and recovery thereof is stayed. [Para 7, 8]
2015-TIOL-1006-CESTAT-MAD
CCE Vs M/s The Supreme Industries Ltd (Dated: February 12, 2015)
Central Excise - Valuation - inclusion of trade discount allowed at different rates to
different buyers in the value for assessment to duty is under dispute herein, with
Revenue claiming that the impugned amounts represented commission.
Held: Issue of inclusion of trade discount settled by Tribunal in the respondent's favor,
considering limitation and merits; no further dilation necessary. [Para 6, 8]
Order of an appellate authority to meet judicial scrutiny should be in clea r terms,
stating what is the matter in controversy before him, the points for his decision, the
facts in issue, evidence tested, law applicable and reasons for the decision as well as
his decision thereon - This is the mandate of section 35(4) of the Central Excise Act,
1944 and similar provision enacted in Customs Act, 1962 - Any deviation to such
process, makes an order cryptic, unreasoned and non-speaking - Apex Court provided
guidelines at Para 7 of the ruling in JCIT Vs Saheli Leasing and Industries, a nd it is
hoped that orders passed by appellate authorities shall emanate in the manner
directed therein. [Para 9, 10]
2015-TIOL-1005-CESTAT-BANG
Tata Marcopolo Motors Ltd Vs CCE, C & ST (Dated: January 7, 2015)
Central Excise - Fabricating body on duty paid chassis - Excess payment - Set off Adjustments for neutralizing the demand of duty is permissible - Such adjustment
between the excess paid du ty and less paid duty does not amount to refund of duty Evidence on record indicates that appellant have paid Rs.2 Crores excess duty on all
clearances during the relevant period in question and such excesses have to be taken
into account for confirming the demand of duty in terms of the provisions of Rule 10A
of Central Excise Valuation Rules - Considering demand that is within limitation and
excess paid duty, balance demand due has already been deposited by reversing the
credit entry - Prima-facie case in favor of assessee - Pre-deposit of balance amount of
duty, interest and penalty waived. (Para 5 -8)
2015-TIOL-1004-CESTAT-BANG
M/s Bangalore Plastics Pvt Ltd Vs CCE (Dated: January 5, 2015)
Central Excise - Valuation - Appellant manufactures plastic mould furniture for
Principal manufacturer who supplies the mould - Assessable value of the final product
is inclusive of cost of mould - Final goods are transferred to depots of the Principal
who sells to the ultimate customers - Whether appellant is liable to pay excise duty on
final sale value charged to the customers - On identical set of facts, Tribunal has
dispensed with pre-deposit and ordered unconditional stay - Following the decision,
appellant is granted unconditional stay - Impugned order of Commissioner (A)
dismissing appeal for non-compliance of stay order and imposing penalty, set aside Matter remanded to Commissioner (A) to hear the appeal without insisting for predeposit. (Para 3, 4)
2015-TIOL-1002-CESTAT-MUM
Mangaldas K Patel Vs CCE (Dated: April 7, 2015)
CX - Rebate Fraud of Rs.11.61 crores - Penalty of Rs.1 crore on Supdt. CEX - It may
be true that the applicant is out of job for some period, however, this cannot imply
that the applicant has no means - Pre-deposit ordered of Rs.5 lakhs: CESTAT
Also see analysis of the Order
2015-TIOL-998-CESTAT -MUM
Samrudhi Sugars Ltd Vs CCE (Dated: March 11, 2015)
CX - CENVAT - Appellant was setting up a new unit and in that context had availed
credit on many items and even though demand was initially for Rs.60.27 lakhs the
Commissioner has confirmed only an amount of Rs.13.34 lakhs - appeal to CESTAT.
Held: It is seen that the items are falling under Chapter 73 of the CETA, 1985 and are
in the nature of inputs used in the manufacture of supporting structures of capital
goods - keeping in view the nature of dispute as also the fact that on being pointed
out the appellants have reversed the CENVAT credit and also paid interest and are not
pressing the demand, the ingredients of section 11AC of CEA, 1944 are missing penalty imposed is set aside & appeal is disposed of: CESTAT [para 5, 6]
2015-TIOL-997-CESTAT -MUM
M/s Nilesh Steel & Alloys Pvt Ltd Vs CCE (Dated: February 24, 2015)
CX - Statements recorded after issue of demand notice - Demand of duty confirmed
by CCE - copy of statements of 14 parties not provided to appellant - gross violation
of principles of natural justice - stay granted - adjudicating authority to supply copies
of all statements and other evidences on the basis of which demand is to be sustained
- thereafter following principles of natural justice, including hearing or cross
examination, adjudicating authority to decide the case - Matter remanded: CESTAT
[para 4]
2015-TIOL-996-CESTAT -DEL
M/s Aditya Polysack Pvt Ltd Vs CCE & ST (Dated: March 17, 2015)
CX - Inputs Services Credit availed on the strength of debit notes which are having
complete details for availment of Cenvat Credit as per Rule 9 of CCR, 2004 - As per
Elecon Information Technology Ltd. 2014-TIOL-1139-CESTAT -AHM , if in debit note,
all the details have been mentioned to avail Cenvat Credit, then assessee is entitled to
take Cenvat Credit - When there is no dispute that ST has been paid, therefore, issue
is no more res integra - Appeal allowed: CESTAT [Para 5, 6]
2015-TIOL-995-CESTAT -DEL
M/s Vishnu Chemicals Vs CCE & ST (Dated: January 12, 2015)
CX - Appellant's unit located at Bhilai is engaged in the manufacture of switchgear
equipment whose corporate office is located at Hyderabad where two more factories
of same company manufacturing the same product - There is another factory of same
appellant company located at Vizag manufacturing same product - The dispute is in
respect of cenvat credit availed by Bhilai Unit on the basis of invoices distributing the
cenvat credit as input service distributor issued by appellant company Head Office at
Hyderabad - Till 31.3.2012, there was no provision that the cenvat credit distributed
by the Head Office as input service distributor should be in proportion to the turnover
of the factories located at various places - During the period till 31.3.2012, there was
no irregularity in issuing of ISD invoices by the Head Office to appellant company
passing on cenvat credit in respect of service which may have been used exclusively
by Vizag Unit - Appellant unit would not be eligible for cenvat credit in respect of
invoices issued by Head Office during the period w.e.f. 1.4.2012 - Appellant is
directed to deposit an amount of Rs.12 lakh: CESTAT [Para 6, 7]
2015-TIOL-992-CESTAT -MUM
Truform Engineers Vs CCE (Dated: March 20, 2015)
CX - CENVAT - Rule 6 of CCR, 2004 - Whether 10% payable on clearances to SEZ
developers under exemption - issue no longer res integra - amendment to Rule 6(6)(i)
of the CCR, 2004 by the amending Notification No.50/2008-CE (NT) dt. 31/12/2008
shall be applicable w.e.f. 10/9/2004 when the CCR, 2004 came into existence and,
therefore, exception provided under Rule 6(6) of CCR, 2004 from operation of rule
6(1) to 6(4) shall be applicable to supply of exempted goods both to SEZ units and
SEZ developers / promoters - Order demanding amount equivalent to 10% of the
value of the goods cleared to SEZ developer is set aside - Appeal allowed: CESTAT
[Para 5, 8]
2015-TIOL-990-CESTAT -MUM
Gkn Sinter Metals Pvt Ltd Vs CCE (Dated: April 28, 2015)
CE - Rule 4 of CER, 2002 - Storing excisable goods outside factory - Exceptional
circumstances undoubtedly would imply temporary and brief period - Permission
sought is for very long or endless period - there is nothing wrong in the reasoning
given by Commissioner while rejecting the request - since the goods manufactured
were not notified under warehousing provisions, the benefit of Rule 20 of CER, 2002
cannot be extended - Appeal rejected: CESTAT [para 5 to 8]
Also see analysis of the Order
2015-TIOL-987-CESTAT -DEL
Continental Chemicals Ltd Vs CCE ( Dated: April 20, 2015 )
CX - Refund - Appellant has procured inputs on which duty has been paid and no
Cenvat credit has been taken by appellant - Said inputs have been used in
manufacture of exported goods which have been exported through merchant exporter
and under Bond - As the input is used in process of manufacture of final product,
therefore, appellant is entitled to take Cenvat credit thereof and as the appellant has
not taken Cenvat credit of duty paid on inputs, consequently, appellant is entitled for
refund of duty paid on inputs - Appeal allowed: CESTAT [Para 2, 8]
2015-TIOL-986-CESTAT -DEL
Simplex Infrastructure Ltd Vs CCE & ST (Dated: December 5, 2014)
CE - Appellant engaged in manufacture of RCC pipes in their factory and not at the
construction site, benefit of notfn would not be available to them - They insists that
site for manufacture of goods was shifted from construction site to the present site
with the approva l of project officer, which was on account of difficulties expressed by
appellant as there was shortage of space and continuous flow of traffic - It is seen
that manufacturing activity was not being done at construction site but at a separate
khata Number and separate site was taken for such fabrication which has nothing but
appellant factory site - No justifiable reason to interfere with stay order which is only
for the purpose of satisfaction of provisions of Section 35F of CEA, 1944 - In the
interest of justice, time to deposit the amount is extended by another six weeks:
CESTAT [Para 5, 6, 7, 8]
2015-TIOL-985-CESTAT -MAD
M M Forgings Ltd Vs CCE ( Dated: March 24, 2015 )
Central Excise - Interest - short issue involved in this case relates to demand of
interest against the delayed payment of duty on supplementary invoices raised by the
appellant; confirmed in adjudication, upheld by Commissioner (Appeals) and agitated
herein.
Held: Issue has been settled by the Supreme Court in the case of SKF India and
International Auto Ltd - ratio squarely applies to the facts of the present case; no
infirmity in the impugned order, which is upheld [Para 4]
2015-TIOL-984-CESTAT -MAD
Hinduja Foundries Ltd Vs CCE (Dated: March 20, 2015)
Central Excise - CENVAT credit - issue relates to denial of credit on MS Channels, MS
Angles, MS Plates etc. after the amendment of definition of Rule 2(k) of Cenvat Credit
Rules, 2004.
Held: Taking into consideration the judicial pronouncements, the appeal is remanded
to the adjudicating authority who shall hear the case afresh after examining the ratio
laid down in the HC judgments and pass appropriate order after hearing the appellant
[Para 3]
2015-TIOL-982-CESTAT -MAD
The India Cements Ltd Vs CCE (Dated: February 25, 2015)
Central Excise - CENVAT credit - common issue in all the appeals is the admissibility
of cenvat credit in respect of both inputs and/or input services used in setting up of
wind mills, generation of wind power and maintenance as well as operation thereof credit denied on the ground that those do not relate to manufacture since energy
generated by wind mills were not used in the manufacture or providing of any output
service; agitated herein.
Held: Bombay High Court in Endurance Technologies case held that there should not
be inadmissibility of input credit on input or input services used by wind mills to
generate energy which is made available through electricity board under barter
system - denial of credit set aside with consequential relief in all cases - Revenue's
appeals dismissed wherever admissibility / penalty contested[Para 5]
2015-TIOL-981-CESTAT -MAD
M/s Ums Radio Factory Vs CCE (Dated: March 26, 2015)
Central Excise - MODVAT credit - appellant engaged in manufacture of electronic
items such as antenna, booster, stabilizer etc. - They have two units both located in
two different premises at Coimbatore - Unit-I imported five machines during the year
1997-1999; filed intimation under 57(1) before purchase and receipt of the machines;
intimated shifting these machines to their unit-II without availing capital goods credit
- The machines were used in Unit -II for carrying out job work for unit-I and
subsequently, unit-II returned these five machines to unit-I in July'99 and Au gust'99
whereupon unit-I availed credit on the CVD paid - The machines were once again
shifted to unit-II after reversal of the entire credit - Revenue viewed the same
irregular; adjudicated demand for recovery of credit with interest and penalty on both
units; penalty reduced by Commissioner (Appeals), culminating in the instant appeal.
Held: Without any investigation and proof of evidence contrary to the intimation and
documents on record the adjudicating authority concluded that there is no receipt of
capital goods in unit-I - The first appellant had availed the credit for the first time
when the said capital goods returned from unit-II on 2.8,.99 and on 30.8.99 and
immediately filed the declaration under Rule 57S(2) on 30.8.99, which was duly
acknowledged by the Asst. Commissioner - no dispute on the fact that the appellants
have reversed the entire credit availed while shifting on 30.08.99 to their unit-II,
which is clearly reflected in the invoice dated 31.08.99 and supported by RT12 returns
filed for the month of August'99 wherein both availment of debit of RG23 (c) part 2
has been reflected in the returns - reversal of credit is in conformity with Rule 57Q(8)
of CER,1944 - In the case of Pooja Forge Ltd on identical issue the DB of the Tribunal
has allowed the credit on capital goods where the capital goods were removed from
unit-I to unit-II of the appellants own units; the same was upheld by the P&H High
Court - Ratio of the Pooja Forge ruling squarely applicable to instant case - appellants
followed the procedure correctly in conformity with Rule 57Q, 57(T) and 57(S) and
rightly availed and reversed the same at the time of removal of capital goods to their
unit-II - impugned order disallowing credit availed against the first appellant and
imposition of equivalent penalty is set aside; Consequently, the penalty on the second
appellant does not survive and the same is set aside [Para 7]
2015-TIOL-978-CESTAT -DEL
M/s United Chain Industries Vs CCE (Dated: August 20, 2014)
Central Excise - Penalty - appellant invoiced capital goods to M/s Talbros, allegedly
without supply of physical goods; and credit availed by Talbroson such invoices DGCEI investigated M/s Talbros, proposed demands and penalties on several suppliers
including the appellant for issuing invoices to M/s Talbros without supply of goods non imposition of penalty on appellant by original authority agitated by Revenue
before Commissioner (Appeals) who remanded the case; original authority imposed
penalty in denovo adjudication, upheld by Commissioner (Appeals) and agitated
herein.
Held: Appellants conceded that the invoices were issued without ever supplying any
goods - Settlement Commission itself did not admit their case and such non -admission
was not on the ground that they would be covered by the main order in case of
Talbros - The judgement in the case in K.I. International held that the benefit of the
Settlement Commission's order cannot be extended to those who never approached
the Settlement Commission; contention of the appellants in this regard is not
sustainable - Appellant further contended that the penalty under Rule 25 cannot be
imposed as there were no goods involved - Punjab & Haryana High Court in the case
of Vee Kay Enterprises discussed this very issue and has come to a finding that even
in such cases, penalty can be imposed - Further in the case of appellants, the fraud
committed is deliberate and blatant and involved manipulation of documents; no
mitigating factors in this case to justify lower penalty - no infirmity in the impugned
order. [Para 5, 6]
2015-TIOL-975-CESTAT -MUM
Shri Siyaramji Gupta Vs CCE (Dated: March 19, 2015)
CX - Rule 26 of CER, 2002 - Penalty - Sugar which was cleared for export was not
exported but diverted for home consumption - Penalties on exporter, Chairman and
Secretary & Ex-Managing Director of the sugar factory, whether imposable. Held: As
per rule 26 of CER, 2002 penalty can be imposed on any person who acquires
possession of excisable goods which he knows or has reason to believe that the goods
are liable for confiscation - In the cases in hand it is not in dispute that the sugar
which has been cleared for export purpose was cleared on examination and on
debiting B-1 Bond, AR-4 documents - If the bond amount (which is executed for
undertaking dis charge of duty liability) is debited and the goods are cleared the
question as to whether they may be confiscated may not arise - all the three
appellants could not have any reason to believe that sugar cleared for export is liable
for confiscation - penalties set aside and appeals allowed: CESTAT [para 6]
2015-TIOL-972-CESTAT -DEL
M/s Seleno Steels Ltd Vs CCE & ST (Dated: January 27, 2015)
CX - Department's case of duty evasion against assessee is based on recovery of
certain documents from commission agent Shri Gopal Krishna Aggarwal, which
showed that assessee sold certain consignments of sponge iron to various customers
through M/s Gopal Steel and for which Shri Gopal Krishna Aggarwal received
commission - No inquiry had been made with transporters or customers mentioned in
records of Shri Gopal Krishna Aggarwal and similarly neither the factories of assessee
had been visited in follow up action nor there is any allegation of discrepancies in
stock of finished goods or raw material in their factories - Assessee had requested for
cross -examination, but same has been refused by Commissioner, which is necessary,
as other than the documents recovered from Shri Gopal Krishna Aggarwal and his
statement, there is no other evidence in support of Department's allegation of duty
evasion - Appeal is restored and matter is remanded to Commissioner for denovo
adjudication: CESTAT [Para 1.1, 6]
2015-TIOL-971-CESTAT -DEL
Shri Siddeshwar Tobacco Prod Pvt Ltd Vs CCE (Dated: February 24, 2015)
CX - Assessee are manufacturer of pan masala containing tobacco called gutkha and
paying their monthly duty liability in advance - By the order dated 25/07/12 of
Government of Chhattisgarh, manufacture and sale of gutkha was banned with
immediate effect - Vide letter dated 26/07/12 addressed to department, assessee
clearly informed that in view of ban on manufacture and sale of gutkha and pan
masala, they wish to permanently discontinue manufacture of gutkha from 27/07/12 All the machines were sealed in the evening of 27/07/12 in presence of Panchas Refund claim was filed in respect of duty for period from 28/07/12 to 31/07/12, as
they had already paid duty for the entire month of July, 2012 in advance - Assistant
Commissioner has refunded disputed amount strictly in accordance with Rule 16 of
Pan Masala Packing Machines Rules, 2008 - Revenue argued that assessee has paid
duty for month of July, 2012 with a delay and for that they are required to pay
interest - If at all, there was demand of interest, for that department could have
proceeded separately which department has failed to do so - Therefore, impugned
order is set aside and appeal allowed: CESTAT [Para 6, 7, 8]
2015-TIOL-970-CESTAT -DEL
M/s VE Commercial Vehicles Ltd Vs CCE (Dated: January 19, 2015)
CX - Cenvat credit totalling to Rs.23.68 Crores has been denied i n respect of total 21
different input services including consultancy service - Credit of Rs. 5,54,49,137/- was
sought to be denied by SCN in respect of consultancy services received from foreign
service providers on the ground that assessee, the service re cipient had paid ST on
these services under section 66 A of FA, 1994, while CCR, 2004 do not permit cenvat
credit of ST paid by a service recipient under section 66 A - Commissioner has not
discussed at all as to how the said consultancy services are not covered by definition
of 'input service' - In respect of other services received by assessee from various
domestic service providers he has not discussed at all the Board's Circular
No.943/4/2011 cited by assessee on the ground that he could not locate the circular
on CBEC Website - He has not even discussed question of admissibility of cenvat
credit in respect of these services on merit - Order passed by Commissioner is an
irresponsible order which is not expected from a senior officer of rank of
Commissioner, same is set aside - Matter is remanded to Commissioner for de-novo
adjudication: CESTAT [Para 3, 5]
2015-TIOL-966-CESTAT -MUM
CCE Vs M/s Hindustan Lever Ltd (Dated: January 15, 2015)
CX - CENVAT - Slump sale of on -going factory along with raw materials, packing
materials etc. - no cause for reversal of CENVAT credit on inputs as there is no
"removal" from factory - Revenue appeal dismissed: CESTAT [para 5]
Also see analysis of the Order
2015-TIOL-962-CESTAT -DEL
M/s Slotco Steel Products Pvt Ltd Vs CCE (Dated: March 4, 2015)
CX – Clandestine removals - Relevancy of statements - While the allegation of duty
evasion against the appellant is based on the statements of suppliers, their cross
examination has not been allowed - If the adjudicator wants to invoke clause (a) of
Section 9D(1) of CEA, 1944, a finding has to be given that the situations mentioned in
this clause exist after hearing the appellant – In this case admittedly neither a finding
has been given after hearing the appellant that the witness whose statements are
sought to be relied upon by the Department in support of the allegation of duty
evasion against the ssesse are either dead, or cannot be found, or are incapable of
giving evidence, or are being kept out of way by the adverse party, or their presence
cannot be obtained without an amount of delay, or expense which is unreasonable nor
the witnesses who are available, have been made available for cross examination
which – this requirement is necessary and, therefore, order is set aside and matter
remanded to Commissioner for denovo adjudication: CESTAT [para 7, 8]
2015-TIOL-961-CESTAT -DEL
Trimurti Fragrances Pvt Ltd Vs CCE & ST (Dated: December 14, 2014)
CX - Appellant in addition to manufacturing Gutkha pouches of RSP Re.1/- per pouch
in respect of which declaration had been made by them in Form -1, also manufactured
gutkha pouches of RSP of Rs.0.50 paise per pouch on same packing machines Appellant dis charged their duty liability at per machine per month rate specified in
Notfn 42/2008-CE - Revenue asked assessee to treat each machine on which gutkha
pouches of RSP of Re.1/- as well as Rs.0.50 paise per pouch were manufactured, as
two machines - As per Phool Chand Sales Corporation, 1st proviso to Rule 8 of PMPM
Rules applies only when pan masala/gutkha with two RSPs falling under two different
slabs are manufactured on a machine in a month - Requirement of pre -deposit of duty
demand, interest thereon and penalty for compliance with provisions of Section 35F of
CEA, 1944 would cause undue hardship - Stay granted: CESTAT [Para 5, 6, 7, 8]
2015-TIOL-960-C ESTAT -MUM
Rathod Industries Vs CCE (Dated: November 13, 2014)
CE -175/86-CE - Appellant, engaged in the manufacture of goods falling under
Chapter 84 and 87 - appellant's claim was that they can clear goods free of excise
duty upto Rs. 30 lakhs out o f which they can clear goods worth Rs. 20 lakhs falling
under Chapter 84 and another Rs. 10 lakhs for the goods falling under Chapter 87,
even though in between they have cleared goods falling under Chapter 84 on payment
of duty. Held: Once aggregate value of clearances of the specified goods crosses the
limit of Rs.30 lakhs, benefit of Not. 175/86 cannot be extended - appeal dismissed :
CESTAT [para 6, 7]
2015-TIOL-959-CESTAT -MAD
Surya Exports Vs CCE (Dated: March 23, 2015)
Central Excise - Refund - both the adjudication and lower appellate authorities
disallowed the refund claim on the ground that appellants have not produced proper
evidence to substantiate their claim.
Held: In the appellant's own case on the identical issue, this Tribunal rejected the
appeal - appellants in the past also had not produced relevant original documents
before any of the authorities and even in the present appeal, the y have failed to
submit original documents - no infirmity in the impugned order, which is upheld [Para
3, 4]
2015-TIOL-957-CESTAT -AHM
M/s Standard Silk Mills Vs CCE & ST (Dated: December 3, 2014)
CX - Assessee have paid duty on the basis of actual production as they never opted
for compounded levy scheme - For the period under closure no duty can be demanded
even under compounded levy - Revenue could not bring any documentary evidence to
the notice of bench that such a declaration was in fact filed by the assessee except to
a mention made in OIO passed by Adjudicating authority - Assessee received
information through RTI to the effect that no such declaration is available with
department - Stay granted: CESTAT [Para 4]
2015-TIOL-955-CESTAT -MUM
Krcd (India) Pvt Ltd Vs CCE (Dated: March 31, 2015)
CE - MP3 CD-ROMs contain only audio songs which can be played on any MP3 CD
player, these discs are neither interactive nor is it possible to manipulate the details in
such CDs - they cannot be considered as 'software' so as to be classified under
Heading 8524.20 at Nil rate of duty - Appeal dismissed: CESTAT [para 4, 7, 8, 9]
Also see analysis of the Order
2015-TIOL-954-CESTAT -MUM
M/s Tata Motors Ltd Vs CCE (Dated: February 18, 2015)
CE - Whether Cess is applicable on Tractors cleared by appellant during the period
June 2001 to December 2001 - both automobile and tractor cess are leviable @1/8%
and both are covered by section 9 of IDRA Act, 1951 - consequent to decision of
Himachal Pradesh High Court in the case of Indo Farm Tractors & Motors Ltd., Board
has vide Circular 916/6/2010-CX clarified that tractor cess is chargeable - although
demand notice proposes to recover the same under sr. no. 7, tractors are more
specifically covered under sr. no. 10 - rate of cess is same under both entries demand upheld, however penalty imposed u/r 173Q of CER, 1944 of Rs.60,000/ - is
set aside - Appeal partly allowed: CESTAT [para 5]
2015-TIOL-953-CESTAT -MUM
CCE Vs Tatat Steel Ltd (Dated: March 30, 2015)
CX - Revenue appeal against o -in-a for non-imposition of interest and penalty on
respondent - respondent assessee had filed appeal against the same o -in-a and their
appeal was allowed on merits by setting aside o-in-a vide final order dated
15.11.2010 - in this view of the matter, nothing survives in the appeal filed by the
Revenue - appeal rejected: CESTAT [para 4]
2015-TIOL-952-CESTAT -AHM
M/s Vaibhav Auto Industries Vs CCE & ST (Dated: January 15, 2015)
CE - Assessee was directed to deposit an amount of Rs. 60,00,000/- - But they have
deposited only Rs. 30 Lakh and filed an application before the High Court for
extension of time for compliance of stay order - High Court by order dated 10.10.2014
extended the time up to 31.12.2014 - Assessee neither produced the compliance
report nor any further order from High Court - Appeal is dismissed for non compliance
of any order: CESTAT [Para 2]
2015-TIOL-946-CESTAT -DEL
M/s Tarun Alloys Ltd Vs CCE & ST (Dated: April 6, 2015)
CX - It is alleged that appellant during the period April 2008 to November 2008, had
clandestinely cleared 2145 MT of MS Ingots to KIL on which duty involved is Rs.
95,83,397/- - Out of said demand, duty demand of about Rs. 35 lakh is alleged
clandestine cleara nces of 789 MT of MS Ingots is based on purchase file and balance
amount of duty demand is based on the data retrieved from CPUs, Pen Drives and
Laptops - Commissioner while adjudicating the matter against KIL has held that
CPU/pen drive data is not reliable and on this basis had dropped the entire demand
based on such data retrieved from CPUs, Pen Drives and Laptops - Therefore, out of
total duty demand of Rs. 95,83,397/- at least demand of about Rs. 35 lakh may be
sustainable - Duty demand is based only on entries in purchase files maintained by
employees of KIL which had been recovered from their premises and prima facie, no
other evidence of unaccounted purchase of raw material or evidence of clandestine
removal by appellant was found - Stay granted: CESTAT [Para 5]
2015-TIOL-942-CESTAT -MUM
Rakhoh Enterprises Vs CCE (Dated: May 1, 2015)
CE - Duty demand along with interest upheld, however, penalty set aside - Appellant
submitting that sine qua non for invoking extended period & imposing penalty u/s
11AC is one & the same - as order was passed after considering all material facts and
judgements , no patent mistake exists - ROM dismissed: CESTAT [para 3, 3.1, 3.2]
Also see analysis of the Order
2015-TIOL-941-CESTAT -MAD
CCE Vs M/s Universal Fireworks Industries (Dated: November 12, 2014)
Central Excise - SSI exemption - Respondents engaged in the manufacture of
fireworks - Revenue was of the view that the said units are not eligible to avail SSI
exemption benefit under Notification No. 175/86-CE dated 1.3.1986 individually;
notice proposing denial of SSI benefit by clubbing clearances of the four units dropped
in adjudication, upheld by Commissioner (Appeals) and agitated by Revenue before
the Tribunal in the first round of litigation, who held that the units are independent;
that SSI benefit was admissible; and remanded it to the original authority to examine
the removal of the goods without payment of duty clandestinely - demands dropped in
the second round of litigation, culminating in the instant appeals by Revenue.
Held: Tribunal in the earlier round held that all the units are independent and the
benefit of exemption Notification is required to be extended - same was not
challenged by the Revenue before the higher appellate forum; hence Revenue is not
permitted to proceed on the same grounds in the remand proceedings - well settled
by the various decisions of the Tribunal that clubbing cannot be established without
any evidence of flow of funds - In the case of VIR Industries it has been held that the
three units having some common partners operating from the same premises and
having common facilities, entire production of two units sold to third unit, no finding
of special financial relationship involving common funding and financial flow back or
manipulation of accounts and therefore clearance cannot be clubbed and assessable
value to be the sale price of each unit - In the case of Techno Device it has been held
that maintenance of accounts of various units by a single person and at one office is
not a ground for justifying clubbing - Revenue has not placed any material for
clandestine removal of the goods as directed by the Tribunal in earlier order - No
infirmity in the order passed by the Commissioner (Appeals) recording detailed
findings on clubbing, which is upheld. [Para 4, 6, 7]
2015-TIOL-940-CESTAT -DEL
CCE Vs M/s United Breweries Ltd (Dated: February 27, 2015)
CE - Whether carbon dioxide which is generated during fermentation process in
assessee's factory and stored by them after liquefaction and is subsequently used for
carbonation of beer, would be chargeable to central excise duty or not; that in this
regard basic question to be decided is as to whether this carbon dioxide is marketable
or not - Carbon dioxide which is generated during fermentation process would have
certain impurities of methane and alcohol and for making it marketable as carbon
dioxide gas, same would have to be purified for which a separate plant is required - It
is a well settled law that marketability of goods in form in which the same are cleared
for captive use has to be proved - Carbon dioxide purchased from carbon dioxide
manufacturers is not comparable with gas which was being produced in their factory Appeal dismissed: CESTAT [Para 6, 7, 8]
2015-TIOL-938-CESTAT -DEL
M/s Rathi Ispat Ltd Vs CCE (Dated: March 30, 2014)
CX - Group of appeals along with stay applications have been filed on 2.3.2010 and
thereafter stay applications had been listed for the first time on 11.06.2010 - On that
day on request of appellant the matter was adjourned to 24.08.2010 - Between
August, 2010 to May, 2014, matter was adjourned by Bench from time to time for
various reasons - Adjournment was again granted on appellant's request was on
27.06.2014 when the matter was adjourned to 11.07.2014 and on this date
appellant's counsel could not come, as according to him, he was seriously ill and was
suffering from high fever an d in this regard, records of his treatment in form of
prescription given by CGHS Doctor as well as Private Physician has been placed on
record - Cost of Rs.25,000/ - imposed on appellant vide misc. order is waived and
misc. application is allowed: CESTAT
2015-TIOL-935-CESTAT -MUM
CCE & Cus, Vs Noble Grains India Pvt Ltd (Dated: February 11, 2015)
CE - Notfn. 41/2007-ST - Respondents are manufacturers of soya extraction meal refund claims filed in r/o service tax paid to service providers in connection with
consignments cleared for export - refund denied by original authority on the ground
that jurisdiction of sanctioning refund would arise only at Indore Commissionerate as
the export documents were prepared from the registered office there Commissioner(A) allowed appeals and, therefore, Revenue filed appeals before
CESTAT. Held: There is no dispute that consignments exported were cleared from
Akola factory and, therefore, the jurisdiction for claiming refund cannot be shifted to
Indore - respondent has correctly filed refund claims at Nagpur Commissionerate - it
is avowed policy of the Central Government that all exports should be of goods and
not taxes - order of Commissioner(A) is correct, proper and legal and does not suffer
from any infirmity - Revenue appeals rejected: CESTAT [para 7, 8]
2015-TIOL-934-CESTAT -AHM
Mahalaxmi Extrusions Vs CCE (Dated: March 4, 2015)
CX - Assessee purchased Brass Ingots from Dubai Company, who placed the orders to
M/s Mitesh Impex, a 100% EOU, supplied the goods to assessee in DTA as per
agreement with Dubai company - Goods were delivered to appellant accompanied
with CE invoices - In Cenvat Scheme, ownership of input is not relevant factor and the
assessee would entitle to avail cenvat credit on the basis of duty paying documents
prescribed under Rule 9 of Rules 2004 - There is no dispute that input received in the
factory of assessee - Manufacturer of input supplied the goods in DTA, thus, there is
no scope to use documents by overseas company - So, denial of cenvat Credit is not
justified - Accordingly, impugned order is set aside and appeal allowed: CESTAT [Para
5, 6, 8]
2015-TIOL-933-CESTAT -DEL
Shri V K Gupta Vs CCE (Dated: February 12, 2015)
CE - Role of Shri V K Gupta as described in impugned order is not covered by
activities enumerated in rule 209A of CER, 1944/ Rule 26 of CER, 2001/02 for which
penalty is attracted and similarly not covered by activities enumerated in section
112(b) of Customs Act, 1962 which would attract penalty - Shri VK Gupta has not
acquired possession of or has not dealt with any excisable goods which he knew or
had reason to belief were liable for confiscation and s imilarly he has not acquired
possession of or has sold or was involved in dealing with any imported goods which he
knew or had reason to belief were liable for confiscation - Provisions of Rule 209A or
Rule 26 are not attracted, and hence, penalty imposed on him is not sustainable Penalty imposed on him under section 112(b) of Customs Act, 1962 is also not
sustainable: CESTAT
CE - As regards, the other employees, Shri Pramod Nigam, was authorized signatory
of M/s Margra Industries Ltd. and allegation aga inst him is that while as authorized
signatory, it was his prime responsibility to ensure that rules and regulations are
scrupulously followed in unit, but he failed to discharged his responsibility - Allegation
against Shri Manoj Gupta is that he entered the figures for the period from
23.12.1999 to 23.12.2002 in the register without corroborating record on the basis of
figures supplied by one Shri A. K. Banerjee and thus he has tried to fabricate records,
which he knew were manifestly wrong - Allegation a gainst Shri Abbas Ali is that he
prepared invoices for excisable goods which were removed without payment of duty Neither the provisions of section 112(b) of Customs Act 1962 would be attracted nor
the provisions of Rule 209A of CER 1944/ Rule 26 of CER, 2001/2002 would be
attracted, and hence, penalty imposed on these employees are not sustainable:
CESTAT
2015-TIOL-932-CESTAT -DEL
Sandeep Laminates Ltd Vs CCE (Dated: December 29, 2014)
CE - During the period prior to amendment of tariff in 2007 in terms of Apex Court
judgement in the case of Metalex India Pvt Ltd - 2004-TIOL-77-SC-CX , process
undertaken by appellant did not amount to manufacture - There is no dispute that the
amount paid b y appellant on the clearances of laminated polyster Films is much more
than the cenvat credit availed - Impugned order is not sustainable and as such the
appellant have strong prima facie case in their favour - Stay granted: CESTAT [Para 6,
8]
2015-TIOL-931-CESTAT -DEL
N C Cables Ltd Vs CCE (Dated: December 11, 2014)
CX - Assessee took over the business of M/s National Cable Industries and sought
regis tration in their name - Assessee availed Cenvat Credit lying in account of M/s
National Cable industries - It is alleged that assessee has taken credit without
permission - As per rule 10 (3) of CCR, 2004, there is no requirement to take prior
permission to take Cenvat Credit from concerned authorities - As assessee has taken
credit and informed the department and filed ER return regularly and same has been
accepted by department, therefore, question of taking any permission does not arise Cenvat Credit is available to assessee - Appeal allowed: CESTAT [Para 7, 8, 9]
2015-TIOL-929-CESTAT -DEL
R A Casting Pvt Ltd Vs CCE & ST (Dated: January 16, 2015)
Central Excise - Demand - appellant are manufacture of MS ingots; officers visited
their factory and detected shortage of inputs and finished goods - demands
adjudicated with interest and penalty; upheld by Commissioner (Appeals) and
agitated herein.
He ld: appellant has paid the duty at the time when shortage was detected; did not
contest the duty liability but contested only penalty till the level of Commissioner
(Appeals) - appellant cannot be allowed to contest the duty liability taking support of
Hri Sidhdata Ispat - Commissioner (Appeals) has given a clear finding that there is no
tangible evidence of clandestine removal of goods; same not challenged by Revenue penalty on appellant is not imposable and is set aside; impugned order is modified
accordingly. [Para 7]
2015-TIOL-928-CESTAT -MAD
Saravana Ginning Factory Vs CCE (Dated: August 20, 2014)
Central Excise - Valuation - appellants SGF and SSTL are engaged in the manufacture
of cotton yarns; SSTL cleared cotton yarn on job work basis on receipt of the raw
materials from SGF, to the consignment agents - first appellant has not discharged
the excise duty on the value of the goods sold at the p remises of the consignment
agents, instead they have paid excise duty on the value certified by the Chartered
Accountant - differential duty demand with interest confirmed on SGF, apart from
penalties on both appellants, upheld by Commissioner (Appeals), a nd agitated herein.
Held: SGF instead of returning the finished goods to the principle manufacturer
directly cleared the goods to the consignment agents on payment of excise duty - the
consignment agents in turn collected the excise duty and sales tax from the buyers;
SGF has already collected the excise duty as per the value from the customers at the
price at which it was cleared from the consignment agents, hence duty is payable on
the goods manufactured and cleared from the job worker directly to the consignment
agent on the price at which consignment agents have sold to the buyers - Case law
relied upon by Revenue applicable to the present case and Ujagar Prints ruling relied
upon by SGF distinguished on facts - no infirmity in the findings of the adjudicating
authority in confirming the demands - However, penalty imposed on SSTL reduced
from Rs.25,000/- to Rs.5,000/- and the penalty imposed on SGF is set aside. [Para 5]
2015-TIOL-920-CESTAT -MAD
M/s Kores (India) Ltd Vs CCE (Dated: March 6, 2015)
Central Excise - Interest - Ex parte ruling passed earlier for non prosecution agitated
on ground of age of counsel; same restored and examined on merits.
Held: Under Explanation I to section 11BB of Central Excise Act, 1944, mandate is
that when the duty earlier payable in adjudication is reduced by Tribunal, the date of
determination of the duty shall be the date on which an amount of duty is first
determined to be payable - adjudication order which gave rise to the demand of duty
to the extent confirmed by Tribunal, becomes enforceable demand and only if that
demand is not paid, then there shall be levy of interest - demand which was
ultimately reduced by Tribunal having been discharged; there shall be no interest
liability [Para 4]
2015-TIOL-919-CESTAT -KOL
M/s Mideast Integrated Steels Ltd Vs CCE, C & ST (Dated: January 19, 2015)
CX - Short payment of duty - Assessee, 100% EOU engaged in manufacture of Pig
Iron - Impugned Order has been passed ex-parte - Lack of sincerity on the part of
assessee in participating in adjudication proceeding before Commissioner - In the
interest of justice, assessee be given a chance to place all the documents before
Commissioner in support of their defense/claim - Assessee is directed to file their
reply within two weeks and are directed to co-operate with the Department, without
seeking unwarranted and frivolous adjournments - Matter remanded: CESTAT [Para 5]
2015-TIOL-914-CESTAT -MUM
SKF India Ltd Vs CCE (Dated: April 21, 2015)
CENVAT - s.69 of FA, 1994 - Rules 6, 7, 9, 14, 15, 15A of CCR, 2004 - ISD neither
provides any service nor pays any service tax as provider of output service and,
therefore, there is no question of assessment or self-assessment - Input service
distributor is not an assessee under the Service Tax law, therefore, return cannot be
called as a self -assessment by the ISD - Concept of self-assessment is relevant for
service tax payer alone - Contention that credit cannot be denied unless the
assessment of distribution of credit made at the ISD is set aside is rejected outright Appeals dismissed: CESTAT
Also see analysis of the Order
2015-TIOL-913-CESTAT -DEL
M/s RGR Pharmaceuticals Derabassi Vs CCE (Dated: February 18, 2015)
CX - Assessee, RGR is a job worker of medicaments of NPIL - Revenue views that the
real manufacturer is NPIL - RGR is paying duty on the value arrived at cost plus job
charges as per the formula determined by Apex Court in the case of Ujagar Prints
2002-TIOL-03-SC -C X-CB - As per Glenmark Pharmaceuticals Limited 2007-TIOL2366-CESTAT -MUM , manufacturer is RGR and NPIL is not the real manufacturer - As
per CBEC Circular no. 619/10/2002- CE, duty demand against RGR on the selling price
of NPIL is not sustainable - As appellant RGR has paid duty correctly, therefore,
penalty on both the appellants is not imposable - Impugned order is set aside and
appeals allowed: CESTAT
2015-TIOL-912-CESTAT -DEL
GSC Toughened Glass Pvt Ltd Vs CCE (Dated: March 10, 2015)
CX - Valuation - s.4 of CEA , 1944 - Merely because at the instance of the buyer the
assessee has taken transit insurance it does not indicate that the ownership of the
goods remained with the assessee during transit - SCN issued for inclusion of freight
and transit insurance in the assessable value and demand of differential duty made is
not sustainable - Appeals allowed: CESTAT [ para 13, 14]
2015-TIOL-910-CESTAT -MUM
Conros Steels Pvt Ltd Vs CCE (Dated: February 27, 2015)
CX - ROM - decisions cited by appellant have been delivered four months after
Tribunal passed the order, hence, it cannot be said that there is an error apparent on
face of record - Application dismissed: CESTAT
2015-TIOL-906-CESTAT -MUM
M/s Crompton Greaves Ltd Vs CCE (Dated: December 12, 2014)
CX - CENVAT - Rule 2(l) of CCR, 2004 - Input Service - Denial of credit of ST paid on
outward courier charges, telephone bills and cargo handling charges etc. - appeal to
CESTAT. Held: SCN is vague as it nowhere gives the breakup of the proposed demand
nor it discusses any particular reason as to why the CENVAT credit is not allowable in
respect of the aforesaid three services - whole proceeding is vitiated for want of a
valid show-cause notice - service of a valid SCN containing the exact case and/or gist
of the allegation the appellant has to meet is a sine qua non for the adjudicating
authority to assume jurisdiction for adjudication - order set aside and appeal allowed
with consequential relief: CESTAT [para 5]
2015-TIOL-901-CESTAT -DEL
M/s Balkrishna Industries Ltd Vs CCE & ST (Dated: December 30, 2014)
CX - Reversal of Cenvat credit - Appellant company has two units for manufacture of
Tyres, first unit is at Chopanki and the second unit is at Bhiwadi - Inputs belonging to
Chopanki Unit used by them for job work in manufacture of compounded rubber for
Bhiwadi Unit - No physical movement of inputs - When there is no physical removal of
cenvated inputs, there is no requirement to reverse the credit under Rule 3(5) of CCR
- Amount of Rs.2.01 crores already paid by appellant is sufficient for hearing of their
appeal - Cenvat credit demand of Rs.2.01 crores has been confirmed against appellant
on the ground that this credit had been taken by Bhiwadi Unit on the basis of the
supplementary invoices issued by the Chopanki Unit while non-reversal of this credit
by Chopanki Unit was deliberate - Rule 9(1)(b) is not-applicable in case of inter-unit
transfer - Stay granted: CESTAT [Para 3, 6, 7, 8]
2015-TIOL-900-CESTAT -DEL
M/s Jindal Drugs Ltd Vs CCE (Dated: February 12, 2015)
C X- CENVAT- credit on ASTM, shapes and sections, joists, MSI beam, MS angle,
channel, welding rods and black sheet denied on the ground that these items do not
fall within the definition of capital goods- during the impugned period 2006-2007 up
to 15.2.09, availment of credit on these items were in dispute as there were contrary
decisions at the material time- hence extended period of limitation is not invocable :
CESTAT [ para 8]
C X- CENVAT- Appellant is located in Jammu and availing exemption under notification
56/2002-CE wherein whatever duty is paid by the appellant from PLA they are entitled
for a refund of the same- if in this case appellant had not taken the CENVAT credit,
therefore, whatever duty they would have paid, they could claim as refund- this is a
case of revenue neutral situation and in this eventuality also allegation of suppression
cannot be sustained- appellant succeeds on merits, on time bar and revenue
neutrality- Appeal allowed with consequential relief: CESTAT [ para 9, 10]
2015-TIOL-899-CESTAT -MAD
Ganesh Parthasarathy Vs CCE & ST (Dated: February 16, 2015)
Central Excise - Stay / dispensation of pre deposit - Appellant, a 100% EOU imported
goods duty free; Revenue alleged the same were not used for the purpose imported;
that the duty on DTA clearances was short paid to the extent of Customs duty
foregone - demands adjudicated with interest and penalty and agitated herein.
Held: The duty forgone at the time of import became loss to Revenue; also appellant
has discharged duty liability at normal rate of excise duty which is not equal to
customs duty forgone - prima facie, the demand raised appears to be correct at this
stage - Keeping the interest of Revenue and also striking a balance between the
amount already paid, appellant is directed to provide bank guarantee to the tune of
Rs.1 crore (Rupees One crore only) to Revenue and make cash deposit of
Rs.60,00,000/- (Rupees Sixty lakhs only) - in respect of personal penalty, pre deposit
waived considering hardship.
2015-TIOL-898-CESTAT -AHM
M/s Centricast Enterprises Pvt Ltd Vs CCE (Dated: January 12, 2015)
Central Excise - Stay / dispensation of pre deposit - Extension of Stay - Appellant filed
miscellaneous application for extension of period of stay granted vide Stay Order
No.S/837/WZB/2009 dated 22.06.2009.
Held: Larger Bench in the Haldiram India case held that the Stay Order passed by the
Tribunal may be extended after considering the necessary facts as it would authorize
the exercise of discretion by the Tribunal for grant of such extension - appeal was not
taken for hearing by the Tribunal as there is huge pendency of the appeals; instant
case already fixed for hearing, and therefore, extension of stay granted till the
disposal of the appeal. [Para 5, 9]
2015-TIOL-897-CESTAT -DEL
M/s Faurecia Automotive Seating India Pvt Ltd Vs CCE (Dated: February 23,
2015)
CX - Assessee company is a subsidiary company of FSA, France and they were to
receive certain business support services - A manufacturing unit of assessee is in
Bangalore and another in Gurgaon since February, 2009 - CENVAT Credit denied on
the ground that while credit has been taken by Gurgaon Unit, invoices mentioned
service recipients' address as "Faurecia Automative Seating India Ltd., Bangalore
KIADB - ST in respect of services, in question, received from parent company in
France has been paid by Manesar Gu rgaon Unit and this fact is clear from GAR 7
challans - Assessee who have paid ST under reverse charge mechanism of Section 66
A of FA, 1994 as service recipient in terms of Rule 2 (1) (d) (iv) of STR, 1994, challan
under which ST had been paid is also a valid document for taking CENVAT Credit in
terms of Rule 9 (1) (e) of CCR, 2004 - Since the challans under which ST has been
paid mention Gurgaon Unit as assessee, in terms of Rule 9 (i) (e), CENVAT Credit
cannot be denied to assessee even though invoices mentions the address of Bangalore
Unit of assessee company - Prima facie view that impugned order is not correct - Stay
granted: CESTAT [Para 7, 8]
2015-TIOL-894-CESTAT -MUM
Leo Circuit Boards, Pvt Ltd Vs CCE (Dated: April 23, 2015)
CX - s.2(f) of CEA, 1944 - Activity of assembling lottery terminal from various
imported components amounts to manufacture and consequently liable for payment of
excise duty - Appeals rejected: CESTAT [para 5]
Also see analysis of the Order
2015-TIOL-893-CESTAT -DEL
M/s Autolite India Ltd Vs CCE (Dated: March 19, 2015)
Central Excise - Valuation - Appellant, a 100% EOU made DTA clearance of halogen
capsules to their DTA Unit, assessed on the FOB price at which the goods were being
exported - The Department was of the view that the value is to be determined by
invoking Ru le 7(3) of the Customs Valuation Rules, on the basis of the sale price of
the Halogen Bulbs of the DTA Unit - duty demand with interest and penalties on firm
and individuals adjudicated, and agitated herein.
Held: Under the proviso to section 3(1) of Central Excise Act, 1944, while the duty
payable in respect of the goods cleared by a 100% EOU into DTA is the aggregate
value of duties of customs on import of like goods into India, the assessable value for
this purpose is to be determined under section 14 o f the Customs Act, 1962; hence
the assessable value of the goods cleared into DTA must be comparable with the
contemporaneous import price of identical goods or similar goods into India in
comparable quantity - Department was not correct in adopting the price at which the
unit-I had imported halogen capsules as sample as the quantum of DTA sales being
made by the 100% EOU was much larger and in this regard, the import price of gold
coated Halogen Capsules was not relevant, as the 100% EOU (Unit-I) was not
manufacturing such halogen capsules - contemporaneous import of similar goods in
comparable quantity had been made at the prices which were comparable with the
DTA sale price adopted by the appellant unit, on which no finding was recorded demand against u nit-I based merely on the allegation of clandestine removal and on
entries in the diary recovered from the store keeper, Sh. Satyanarayan, of the DTA
Unit; photocopy of this diary has not been supplied - demand not sustainable and the
matter has to be remanded to the Commissioner for de novo adjudication after
supplying a copy of this diary to the appellant, and taking into account their
submissions in respect of the same - impugned order is set aside and the matter
remanded for de novo adjudication [Para 6-9]
2015-TIOL-892-CESTAT -DEL
CCE Vs M/s Dhvani Terefabs Exports Pvt Ltd (Dated: December 10, 2014)
CX - Classification - Knitted pile fabrics in running length are classifiable under
heading 60.01 and not as textile made up articles, not elsewhere specified under
6307.90 - although the department has filed an appeal against the judgment in
S.Kumars Ltd. case, since the same is still pending, the judgment of Tribunal is a
binding one - Revenue appeal dismissed: CESTAT [ para 7, 8]
2015-TIOL-891-CESTAT -DEL
M/s Goyal Auto Products Pvt Ltd Vs CCE (Dated: March 3, 2015)
CX - Penalty - Assessee is a manufacturer of auto parts - Confiscation of finished
goods, semi finished goods and Indian currency of Rs.4,80,000/ - which was found
during visit of officer of Central Excise Department - Penalty under section 11AC of
CEA, 1944, is not imposable as duty demand has already been dropped by
Commissioner (A) - Currency seized is the amount withdrawn from bank which is not
the sale proceed of goods which have been cleared clandestinely - Seizure of Indian
currency is not correct, confiscation of Indian currency is set aside - For the goods
seized at their business premises valued at Rs. 20,27,870/-, redemption fine was
imposed of only Rs.25,000/ - whereas goods valued at Rs.91,58,842/-, redemption
fine imposed is Rs.300,000/- which is highly excessive - Therefore, redemption fine is
reduced to Rs. 1,00,000/- Penalties on appellants also reduced: CESTAT [Para 2, 9,
10]
2015-TIOL-889-CESTAT -DEL
CCE & ST Vs M/s Chetan Industries Ltd (Dated: January 5, 2015)
CX - Assessee availed Cenvat Credit on items like Joist, M.S. Angle, Channel and HSM
plates - Commissioner (A) in his order found that that all these items have been used
by assessee in manufacturing of capital goods which in turn is used for manufacturing
of final product - Said fact has not been denied by revenue - No infirmity in impugned
order, same is upheld - Appeal dismisseed: CESTAT [Para 2, 6, 7, 8]
2015-TIOL-884-CESTAT -DEL
Jain Ispat Vs CCE (Dated: February 12, 2015)
CE - If a private limited company or public limited company or a partnership or a
proprietorship firm as a registered dealer issues bogus invoices without supply of any
material to enable another person avail CENVAT credit it would not be correct to say
that in such cases the person who had issued the bogus invoices would not be liable
for penalty under Rule 26(2) of CER , 2002 - Pre -deposit ordered: CESTAT by Majority
Also see analysis of the Order
2015-TIOL-880-CESTAT -MAD
S K Electro Engineers Vs CCE (Dated: February 15, 2015)
Central Excise - clandestine clearances - investigation recovered various chits
containing entries directly demonstrating clearances of the goods manufactured by
the appellant - demands confirmed with interest and penalties on the firm and
individuals, agitated herein.
Held: When the chits recovered during investigation were not disowned by the
appellants, the elementary principle of jurisprudence that possessions follow title
brought the appellants to the rigour of law - clear case to hold that the goods were
removed clandestinely and cleared without payment of duty - involvement of the
Directors in evasion could not be ruled out; Clandestine removal was established from
the material facts and circumstances hence imposition of penalty on both the
Directors is justified - appellant did not discharge the duty in full, the Director shall
not get any leniency under the first proviso to Section 11A read with Section 11AC of
the Central Excise Act, 1944 and there is no necessity to further grant any concession
in penalty to any of the appellants. [Para 2, 3, 4]
2015-TIOL-878-CESTAT -MUM
M/s Sai Wardha Power Ltd Vs CCE (Dated: April 22, 2015)
CX - Maintainability - In the matter of refund/rebate against the supply of goods to
the SEZ located in India, whether the appeal lies before Appellate Tribunal or a
Revision Application is to be filed before the Jt. Secy. (Revisionary Authority) to GOI divergent views - Matter referred to Larger Bench: CESTAT [para 4, 5]
Also see analysis of the Order
2015-TIOL-877-CESTAT -KOL
M/s Lakhotia Metalizers Pvt Ltd Vs CCE (Dated: December 3, 2014)
CX - Duty evasion by M/s Lakhotia Metalizers Pvt. Ltd. and M/s A. B. Polymers, has
been quantified from the records recovered from their premises - Commissioner has
found that other applicants were involved in aiding/abetting the impugned duty
evasion - Said applicants pleaded that there is no evidence to support the contention
of revenue that they abetted the duty evasion by M/s Lakhotia Metelizers Pvt. Ltd. Case is based on appreciation of evidence produced by both the sides, which would be
gone in detail at the time of final disposal of appeals - Each of applicants has acted
and omitted in a manner contributed to alleged duty evasion - M/s Lakhotia Metalizers
Pvt. Ltd. is directed to deposit 10% of duty confirmed & M/s A. B. Polymers to deposit
5%, of duty: CESTAT
2015-TIOL-876-CESTAT -MAD
M/s Lakshmi Technology & Engg Vs CCE (Dated: January 28, 2015)
Central Excise - CENVAT credit - dispute relates to obligation of appellant
manufacturer under Rule 6 of CCR 2004, producing both dutiable and exempted
goods.
Held: Record reveals that there were rival contentions of both sides during pre adjudication and adjudication stage, therefore controversy on existence of evidence
may be well resolved if the appellant comes out with clean hands to adduce evidence
before the adjudicating authority and demonstrate that there exists separate record
showing manufacture of exempted goods and dutiable goods and the inputs / input
services attributable to such goods - record also reveals that during investigation,
certain materials were found out by the authorities from different places and certain
registers in each of the cubicles were existing but no co-relation with regard to
availment of Cenvat credit was made out by Range Officer - proper to remit back the
matter to the adjudicating authority to examine the entire evidences which is borne
by the record, granting reasonable opportunity of hearing to the appellants in time
bound manner.
2015-TIOL-875-CESTAT -DEL
Prakash Industries Ltd Vs CCE & ST (Dated: February 10, 2015)
CX - Tribunal's order directing the appellant to deposit an amount of Rs. 12.00 Crores
within a period of four weeks had been upheld by Chattisgarh High Court and an SLP
against High Court's order had been filed - Apex Court while dismissing the SLP had
directe d that amount to be deposited within a period of four weeks from the date of
order - Once the appeal against Tribunal's stay order under Section 35F of CEA, 1944
is dismissed by High Court, Tribunal's stay order mergers with High Courts order and
Tribunal cannot modify its stay order and extend the period of pre -deposit - Appeal is
dismissed for non-compliance of provisions of section 35F: CESTAT [Para 9, 10]
2015-TIOL-874-CESTAT -DEL
M/s Osaka Alloys And Steels Pvt Ltd Vs CCE & ST (Dated: March 13, 2015)
CX - Since, both the exemption notifications are in force, a unit located in the area
specified in Notification No. 56/02-CE has option either to avail of the exemption
Notification No. 56/02 -CE or avail of Notification No. 1/2010-CE - Even if an applicant
does not claim benefit under a particular notification at initial stage he is not
debarred, prohibited or estopped from claiming such benefit at a la ter stage – Matter
remanded to Commissioner for denovo decision: CESTAT [para 7, 9, 11]
2015-TIOL-868-CESTAT -DEL
M/s Man Industries India Ltd Vs CCE (Dated: March 4, 2015)
CX - Assesssee manufactures SAW pipes - Said pipes supplied to Gujarat Water
Supply and Sewerage Board (GWSSB), which as per the contract were to be cement
coated/ epoxy coated pipes - Dispute is only in respect of value of epoxy coating
which, according to Commissioner's impugned order had been done inside the factory
- According to assessee, epoxy coating had been done outside the factory and hence,
value of this coating is not includible in assessable value - If the appellant had availed
cenvat credit in respect of coating material and did not include the value of coating in
assessable value of pipes and this fact was not specifically intimated to Department, it
would amount to suppression of relevant facts from Department and extended period
under proviso to section 11A(1) of CEA, 1944 would be invokable - Impugned order
set aside and matter remanded to Commissioner for de novo adjudication:
CESTAT[Para 6, 8]
2015-TIOL-863-CESTAT -DEL
M/s Pepsico India Holding Pvt Ltd Vs CCE & ST (Dated: February 9, 2015)
CX - COD in filing appeal - in matters involving identical issue the appellant had filed
appeals before Tribunal and had been granted unconditional waiver from the
requirement of pre-deposit - in the present case the new employee and legal
Manager, both of them, by mistake treated the order as a SCN and did not take any
action of filing an appeal - it is seen that there is no reason for the appellant in
delaying filing of appeal as the appellant had been granted unconditional stay in
respect of earlier appeals on identical issue - delay in filing the appeal was due to
bonafide mistake on the part of the appellants employees, hence delay of 293 days in
filing appeal is condoned - COD application allowed: CESTAT [ para 6]
2015-TIOL-862-CESTAT -DEL
M/s Perfect Mechanical Industries Vs CCE (Dated: February 12, 2015)
CX - Appellant are a body builder who construct body, on the chassis received by
them - During the period of dispute, they had received duty paid chassis from M/s
Ashok Leyland and vehicle factory - Appellant undisputedly have paid duty on
fabrication charges in terms of notfn 6/06-CE (Serial No. 41) whose applicability is not
disputed by Department - The fabrication charges have been determined by
subtracting the value of chassis from the price at which vehicles were supplied to
Armed Forces by M/s Ashok Leyland and vehicle factory, Jabalpur - Department seeks
to demand duty on 110% of fabrication charges by invoking Rule 8 of CEVR - Rule 8 is
applicable only when the goods manufactured by a manufacturer are captively
consumed by him or by some other manufacturer on his behalf, hence not applicable Impugned order set aside and appeal allowed: CESTAT [Para 5]
2015-TIOL-861-CESTAT -MUM
Ram Techno Pack Vs CCE (Dated: January 14, 2015)
CX - Appellants were converting the paper into paper reels, cores and tubes on job
work basis – Since benefit of Notifications 83/94-CE and 84/94-CE is claimed by
appellant for the first time before the Tribunal, it would be proper to remand the
matter to original authority to examine whether appellants would be really eligible to
benefit of said Notifications - Original authority may also examine the plea of
extended period of limitation: CESTAT [Para 6]
2015-TIOL-860-CESTAT -MUM
Otis Elevator Co (I) Ltd Vs CCE (Dated: March 3, 2015)
CX - s.4 of CEA, 1944 - Valuation - Issue relating to adding of notional interest on
advances has been settled in various judgments of Tribunal and other higher courts it is a settled principle that until and unless Revenue is able to prove that the value is
suppressed due to advances taken, the notional interest cannot be added - Appeal
allowed: CESTAT [para 4, 5]
2015-TIOL-858-CESTAT -DEL
M/s Devta Steel Rolling Mills Vs CCE (Dated: February 6, 2015)
CX - ROM - On appeal being filed by Revenue against the order dated 9/10/2000 of
Tribunal, issue had been decided by High Court against the assessee and in favour of
Department following Apex Court's judgment in the case of Doaba Steel Rolling Mills
2011-TIOL-59-SC -CX - Last sentence in order dated 18/12/2013 to that "it is made
clear that the order of the tribunal passed on 9/10/2010 in the present appeal shall
operate" is deleted - The order dated 18/12/2013 stands modified - ROM application is
allowed: CESTAT [Para 2, 9]
2015-TIOL-857-CESTAT -MUM
Jindal Drugs Ltd Vs CCE (Dated: January 5, 2015)
CX - Argument of the revenue that labelling or relabeling must enhance the
marketability is contrary to the plain reading of note 3 to Chapter 18 - labelling per se
will amount to manufacture - CENVAT credit of Rs.23.02 crores correctly availed and
Rebate of Rs.13.22 crores rightly granted : CESTAT By Majority
Also see analysis of the Order
2015-TIOL-856-CESTAT -DEL
M/s Pepsico India Holdings Pvt Ltd Vs CCE & ST (Dated: February 17, 2015)
CX - Assessee is manufacturing dutiable as well as exempted goods - No seperate
accounts maintained - Assessee has opted for reversal of Cenvat credit on inputs as
per Rule 6(3 A) (b) (i) of CCR, 2004, while revenue views that formula is applicable to
appellant under Rule 6(3A)(b)(ii).
Held: Rule 6(3)A(b) (i) is correctly applicable to assessee, therefore, demand of
Rs.3.23 crores is not sustainable - In impugned order Commissioner himself has
agreed that input services availed by assessee are covered by other R ule 6(5) of Rules
- Stay granted: CESTAT [Para 7, 8]
2015-TIOL-855-CESTAT -DEL
M/s Monu Steels Ltd Vs CCE & ST (Dated: September 29, 2014)
CX - Appellant engaged in production of MS Ingots - Demand has been mainly worked
out on the basis that 830 units of electricity are required for producing of 1 MT of MS
Ingots - Demand can not be sustained merely on the basis of allegation of high
consumption of electricity in the absence of any other evidence to substantiate
unaccounted production and clandestine removal - There is this evidence in the form
of diary entries referred atleast to the extent of 395 MT of steel having been removed
clandestinely - Duty on this quantity of steel comes to about Rs. 11 lacs - Pre -deposit
of Rs. 11 lacs is ordered: CESTAT
2015-TIOL-854-CESTAT -DEL
CC Vs M/s MARK EXHAUST SYSTEMS LTD (Dated: February 26, 2015)
CX - Input service credit on construction service - Rule 2(1) of CCR, 2004 provides for
availment of cenvat credit for setting up, of modernization, renovation or repairs in
the factory premises and all the services undertaken by assessee are only related to
these services - Assessee are entitled to take cenvat credit on construction services
and also do not find any infirmity in impugned order and same is upheld: CESTAT
[Para 3, 4]
2015-TIOL-853-CESTAT -MAD
M/s M M Forgings Ltd Vs CCE (Dated: January 21, 2015)
Central Excise - Refund - appellants are manufacturers of excisable goods clearing on
payment of duty as well as export without payment of duty - they claimed refund of
unutilized input credit attributable to the exported goods under Rule 5 of CCR, 2002
read with Notification No. 11/2002-CX(NT) dated 01.03.2002; partly allowed and
partly rejected in adjudication, upheld by Commissioner (Appeals); and agitated
herein.
Held: As recorded in both the notice and the OIO, closing balance of Cenvat credit as
on 31.12.2003 includes input credit on the physical stock of raw materials and
finished goods - After excluding the credit on inputs lying in stock and contained in
the finished goods in stock, the balance credit amount arrived to Rs. 39,49,239 - Rule
5 of CCR, stipulates that exporter can claim refund only when not able to utilize the
accumulated cenvat credit for payment of domestic clearance - Input credit
attributable to the goods exported has been correctly worked out to Rs. 39,49,239
and what is excluded is the input credit involved in the physical stock of inputs and
finished goods lying in stock on 31.03.2003; adjudicating authority has correctly
sanctioned the refund amount to the extent of Rs.39,49,239 - impugned order is
upheld. [Para 4]
2015-TIOL-847-CESTAT -KOL
CCE Vs M/s Kesoram Rayon (Dated: February 2, 2015)
CE - Assessee engaged in manufacture of Viscose Rayon Filament Yarn and cleared
the same to their depots spread over different parts of country - Duty was paid on
clearance of such goods by determining assessable value provisionally - They have
adopted depots selling price nearest to the time of removal of goods from the factory
and paid differential duty accordingly - As per Rule 7 of Central Excise Valuation
(Determination of Price of Excisable Goods) Rules, 2000, value of goods under
assessment shall be the transaction value of goods sold from the depot at the time
nearest to time of removal - Revenue's Appeal being devoid of merit is dismissed:
CESTAT [Para 4, 5, 6]
2015-TIOL-842-CESTAT -MUM
CCE Vs M/s Rayat Siksan Santha's Satara (Dated: April 24, 2015)
CX - No dispute about CE duty liability which the respondent paid at the time of
investigation itself - No ingredient as enumerated in s.11AC of CEA, 1944 is satisfied
so no reason to levy penalty - at the material time provisions of s.11AB were similar
to s.11 AC, so interest is also not chargeable - Revenue appeal dismissed: CESTAT
[para 5]
Also see analysis of the Order
2015-TIOL-841-CESTAT -DEL
CCE Vs M/s Fortune Metaliks Ltd (Dated: March 3, 2015)
CX - Cenvat credit availed on as inputs/capital goods - Assessee has filed Chartered
Engineers' certificate along with report, design, drawing and photograph which clearly
shows that items in question were used for fabrication of capital goods - As per
Saraswati Sugar 2011-TIOL-73-SC -CX , they are entitled for cenvat credit - No
infirmity in impugned order, same is upheld - Appeal dismissed: CESTAT [Para 5, 6]
2015-TIOL-840-CESTAT -MAD
M/s Lucas Tvs Ltd Vs CCE (Dated: February 19, 2015)
Central Excise - CENVAT credit - appellants are engaged in the manufacture of Motor
Vehicle parts and accessories and availed credit under rule 2(l), of service tax paid on
the invoices raised by the C&F agents - same denied in adjudication and by
Commissioner (Appeals) and agitated herein.
Held: Services provided by C&F agents include freight, delivery charges,
transportation charges, airway bill charges, surcharges, handling charges (both
loading and unloading) - clear from the invoices that the C&F agents have rendered
the said services to the appellant not only on transportation but other charges and
paid service tax - Ratio of HC ruling in the Cadila Healthcare squarely applicable appellants are eligible for input credit on the service tax paid by the C&F agents. [Para
5, 7]
2015-TIOL-839-CESTAT -MUM
Finolex Cables Ltd Vs CCE (Dated: March 2, 2015)
CX - During manufacture of cables, certain amount of cable scrap is generated which
is being sold by the appellant without payment of duty on the ground that the same is
non-excisable - Revenue contention is that the said scrap contains valuable items like
copper, aluminium and are being sold as scrap; that similar scrap is even traded
internationally and, therefore, is chargeable to duty - Demand confirmed by CCE,
Pune-I - appeal before CESTAT - appellant contending that LB decision in Hindalco
Industries Ltd. - 2014-TIOL-1762-CESTAT-MUM-LB holding that Aluminium Dross and
skimmings are chargeable to duty after amendment to definition of s.2(d) of CEA,
1944 by FA, 2008 has been quashed by Bombay High Court - 2014-TIOL-2266-HCMUM-CX - AR submitting that the decision has been challenged in Supreme Court and
the goods involved in present case is not dross and skimmings. Held: Issue is
contentious and the goods involved are not Dross/Skimmings but Cable Scrap which is
an internationally traded commodity - Appellant directed to deposit 7.5% of duty
demanded within six weeks and report compliance: CESTAT [para 5, 6]
2015-TIOL-838-CESTAT -MAD
M/s Raj Petro Specialities Pvt Ltd Vs CCE (Dated: January 30, 2015)
Central Excise - CENVAT credit - HR Plates, MS Tubes and MS Pipes used in the
manufacture of storage tanks, viewed by Revenue as deployed in support structures.
Held: Appellant's submissions have force and subscribes to the ratio laid down by the
High Court of Karnataka in the case of SLR Steels Ltd.
2015-TIOL-837-CESTAT -MAD
M/s India Japan Lighting (P) Ltd Vs LTU ( Dated: February 2, 2015)
Central Excise - Excisability - Moulds and dies supplied by third parties to appellant for
use in making goods for Tata Motors - The difference between the amount paid to the
maker of moulds and dies and the amount realized from Tata Motors has been sought
to be taxed by Revenue, which is in dispute in the present appeal.
Held: Levy of duty on the difference between the charge of moulds and dies paid to
maker thereof and recovery of such charge from Tata Motors is inconceivable when no
such moulds and dies were removed by appellant - Such goods were never cleared by
the appellant who was mere user thereof and such use of mould in the manufacture
does not bring out the case of deemed removal thereof - The finished goods cleared
are only liable to duty and me re use of moulds and dies to manufacture of such
finished goods are not exigible to levy in the hands of the appellant - Apex Court in
the case of Baroda Electric Meters held that the profit charged without having bearing
on assessable value shall not be subject to levy of excise duty - In absence of any
depression to the assessable value, the cost of moulds in the present case cannot be
held to be liable to duty without that being cleared by the appellant nor the difference
realized by appellant from Tata Motors exigible to duty in absence of removal of that
goods. [Para 4, 5]
2015-TIOL-836-CESTAT -MUM
M/s Automotive Stampings And Assemblies Ltd Vs CCE (Dated: April 23,
2015)
CE - No statute permits that if the buyer is entitled for CENVAT Credit then supplier
can avoid to pay excise duty - Plea of Revenue neutrality cannot be accepted - when
invocation of proviso to S. 11A is not under dispute, imposition of penalty u/s 11AC &
interest u/s 11AB is inevitable - Appeals dismissed: CESTAT [para 5]
Also see analysis of the Order
2015-TIOL-831-CESTAT -MUM
SI Group India Ltd Vs CCE (Dated: December 26, 2014)
CX - s.4 of CEA, 1944 - Valuation - Additional consideration - Period June 2 002 to
December 2005 - Appellant manufacturing excisable goods and clearing the same on
payment of Central Excise duty - For specific customers the value which was charged
by them was lower than the value which is charged by them for the same grade and
quality of final products to other customers on the basis of validation of advance
licence in their favour - During the relevant period the judgment of the Tribunal in the
case of IFGL Refractories Ltd. was holding fort till 09.08.2005 when apex court
overturned the Tribunal decision - Lower authorities directed the appellant to pay the
differential dues by a letter dated 04.01.2006 and thereafter issued a SCN dated
13.4.2007 demanding differential duty based upon the allegation of under-valuation
and also invoking extended period - Demand confirmed along with penalty and
interest - Appeal to CESTAT.
Held : SCN invoking extended period seems to be erroneous, as invoices and
documents indicate that clearances made by appellant were in fulfilment of export
obligations on invalidating the licence in their favour - Nothing on record to indicate
that there was suppression or willful mis -statement on the part of appellant with
intention to evade duty - appellant's records were also audited by the departmental
officers - Appellant was taking benefit of ratio laid down by Tribunal in case of IFGL
Refractories Ltd. and should have on his own paid the duty liability for period
09.08.2005 to December 2005, when Apex Court upturned the order of Tribunal - To
that extent, appellant is required to pay duty and interest thereof - since issue
involved is interpretation of law and which was settled by apex court, penalty imposed
is unwarranted and hence set aside: CESTAT [Para 6, 6.2, 6.3, 6.4,]
2015-TIOL-825-CESTAT -DEL
Kapoor Lamp Shade Co Vs CCE (Dated: December 24, 2014)
Central Excise - Manufacture - Appellant factory shop, a proprietorship, p rocure
various components of lamp shades and chandeliers from various sources including
their manufacturing unit and thereafter pack the same in cartons, put their logo on
the cartons and also put the code number of the product - Revenue viewed that this
activity of the appellant amounts to manufacture of the lamps and light fittings
covered by 9405.90 of the Central Excise Tariff Act, 1985 - duty demands with
interest and penalties on firm and individual under Sec 11AA, Sec 11AC of CEA 1944
and Rules 173Q and 209A of erstwhile CER 1944 adjudicated, modified by
Commissioner (Appeals), and agitated herein.
Held : Appellants were procuring the metal/brass parts, fabricated metal items and
capsule mirrors, polythene tubes and packing materials, lamp shade, gla ss shades,
decorative glasses and other items for lamp shades and light fittings; all the
components had been got manufactured with a specific design to match the design of
the finished item and a specific item number or code number was put at the bottom o f
each item and cleared with brand name, logo and price tag in a cartoon as finished
item - appellant do not manufacture any component of lamp shade/chandeliers or
other light fittings but procure the various component of the chandeliers lamp shades
and light fittings of a particular design and packed the same in a box - this activity
would not amount to manufacture; same view held by the Tribunal in the case of
Kapoor Enterprises, by APHC in XL Telecom Limited, and by the Tribunal in the TI
Diamond Chains case - rulings squarely applicable to the facts of the instant case the activity of the appellant does not amount to manufacture and as such the duty
demand is not sustainable on merits - once it has been intimated to the department
that a portion of the factory has been leased to another firm for trading activity and
along with this letter the ground plant had also been enclosed, it was for the
department to ascertain as to what trading activity was being carried on there impugned order is not sustainable on limitation also, and is set aside. [Para 5, 6]
2015-TIOL-824-CESTAT -DEL
M/s K P Pan Products Pvt Ltd Vs CCE (Dated: February 10, 2015)
Central Excise - Stay / dispensation of pre deposit - appellant are manufacturers of
Gutkha and panmasala of different RSP, discharging duty under Panmasala Packing
Machine (Capacity Determination and Collection of Duty) Rules, 2008 - The dispute is
in respect of one packing machine which was being used for manufacture of the
panmasala of retail pouches of the RSP of Rs.2 as well as Rs.3 - appellant discharged
duty liability by treating the machine as having been used for manufacture of
Panmasala pouches of RSP of Rs.3 - Revenue viewed that since, on the same
machine, in addition to the Panmasala pouches of RSP of Rs.3, the pouches of the RSP
of Rs.2 were also manufactured, first proviso to Rule 8 of the PMPM Rules would
become applicable and this machine wo uld have to be treated as two machines - duty
demand with interest and penalty under Sections 11A(1), 11AA of CEA 1944 and Rule
25 of CER 2002 confirmed and agitated herein.
Held : It is clear that first proviso to Rule 8 becomes applicable when on an existing
packing machine, the manufacturer commences manufacture of the "goods of the new
RSP" during that month and in such a situation, this has to be treated as an addition
in the number of operating packing machines for the month - the new retail sale price
would mean the retail sale price which had not been declared in respect of that
machine in the Form -I declaration - if in the Form -I declaration, he had declared that
machine to be used for manufacture of both the RSPs of Rs.3 as well as Rs.4, it
cannot be treated as the case of commencing manufacture of goods of new RSP so as
to attract the first proviso to Rule 8 - if the intension of the Government had been to
treat a particular machine being used during particular month for manufacture of the
retail pouches of two or more RSPs as that many machines, the first proviso would
have been worded differently - when the statute is clear and unambiguous; it has to
be given effect to without adding any words to it or subtracting any words from it the Department's stand in this case is not correct and as such, the appellant have
strong prima-facie case in their favour; requirement of pre -deposit of the duty
demand, interest and penalty is, therefore, waived for hearing of the appeal. [Para
6.1, 7]
2015-TIOL-823-CESTAT -MUM
CCE, C & ST Vs M/s Ispat Metallics (India) Ltd (Dated: March 4, 2015)
CX - During manufacturing Blast Furnace gas is produced which i s exempted from
payment of excise duty under Notfn 76/86-CE - Said Blast Furnace Gas was being sold
by appellant to customers and paying amount equal to 8% on total price of Gas Refund claim filed for said amount as according to appellant assessee, Blast furnace
gas is a by-product and, therefore, no Cenvat Credit is required to be reversed
corresponding to inputs in manufacture of said by-product - original authority rejected
claim, however, first appellate authority allowed the claim - Revenue in appeal. Held:
Case is squarely covered by decision of Supreme Court in Hindustan Zinc Ltd - 2014-
TIOL-55-SC -CX - Payment of 8% /separate accounts not applicable for by-products Revenue Appeal dismissed: CESTAT [Para 5]
2015-TIOL-822-CESTAT -AHM
CCE & ST Vs Taj Haberdashery Products Pvt Ltd (Dated: February 4, 2015)
CX - Brand name - SSI Notfn . 9/2003-CE - Assessee manufactured and cleared Zip
fasteners with sliders bearing the brand /trade name MIG , GUN, TLR belonging to
Madura Coats Pvt Ltd. - benefit of SSI exemption denied - appeal before CESTAT by
assesse. Held: Argument of appellant assesse is that the slider was supplied by the
Madura Coats Pvt Ltd, which was fixed in their manufactured goods and, therefore,
they have not affixed any brand name on the finished goods - it is clearly evident
from the record that the appellant cleared Zip fasteners with sliders, which were
bearing the brand/trade name of Madura Coats Pvt Ltd. - Para 4 of SSI exemption
notification No 9/2003-CE provides that the exemption contained in this notification
shall not apply to the specified goods bearing a brand name or trade name, whether
registered or not, of another person - As per Notification No. 9/2003-CE it is not
relevant, whether the manufacturer affixed the brand name or not - in the earlier SSI
exemption Notification No. 175/86, 1/93 it was specifically mentioned "where a
manufacturer affixes the specified goods with a brand name", which are absent in the
present SSI exemption notification - Admittedly, the assessee had cleared the
specified goods bearing brand name of other person - Apex Court decision in Kohinoor
Plastics Ltd ( 2005- TIOL -120-SC-CX ) would squarely apply - benefit of SSI
exemption correctly denied - no merit in appeal by assessee , hence dismissed:
CESTAT [ para 5, 7]
Penalty - Since the issue involved is interpretation of the notification and there is no
material available of suppression of facts with intent to evade payment of duty,
Commissioner( A) has rightly set aside the penalty - Revenue appeal dismissed:
CESTAT [ para 6]
2015-TIOL-821-CESTAT -MAD
M/s Goyal MG Gases Pvt Ltd Vs CCE (Dated: February 3, 2015)
Central Excise - Manufacture - Stay/dispensation of pre deposit - appellant procured
gases in bulk in tankers, loaded into small cylinders of the specified quantity without
any processing thereof - Revenue viewed the same as manufacture, adjudicated
demands, agitated herein.
Held : Prima facie , Apex Court ruling relied upon by Revenue relates to processing
carried out, but in the present case that is absent - pre -deposit waived during the
pendency of the appeal. [Para 3]
2015-TIOL-819-CESTAT -DEL
M/s Caparo Fasteners Vs CCE (Dated: December 26, 2014)
Central Excise - CENVAT credit - input services credit availed on outdoor catering
service; rent-a-cab service and repair and maintenance service of Company's vehicles
used for business denied in adjudication on the grounds that the impugned services
had no nexus with manufacture; that amounts were collected from workers extended
canteen facility; and agitated herein.
Held: In view of the Ultratech Cement ruling, Appellant is entitled to take Cenvat
credit of service tax on outdoor catering and rent-a-cab services, subject to the fact
that appellant has not recovered the amount from the employees towards rendering
these services - this fact has not been examined by the lower authorities, therefore,
matter needs examination at the end of adjudicating authority to ascertain whether
appellant has recovered any amount from the employees towards rendering a service
of 'outdoor catering' and 'rent-a-cab' service; and if any amount is recovered from the
employees towards these services, same is not entitled to input service credit impugned order is set aside and matter remand ed to examine the quantification of
admissible input service credit only - the vehicles in question have been used by the
appellant in the course of their business being a manufacturer of excisable goods and
hence appellant are entitled to avail Cenvat credit on repair and maintenance services
- impugned order is set aside. [Para 6, 7]
2015-TIOL-813-CESTAT -DEL
M/s Ellora Steels Vs CCE (Dated: February 26, 2015)
CX - Stand of the Department is that the hot rolling process is not possible below
1000°C and as such the appellant were undertaking cold rolling process and hence,
the process undertaken by them amounts to manufacture and the goods
manufactured by them would be chargeable to duty under heading 7211 – Merely on
the basis on the types of customers who were buying the products or the statements
of the suppliers of the rolling stands that the rolls supplied by them were suitable for
cold rolling, it cannot be concluded that the product of the appellant was a cold roll
product - No evidence has been produced that the claim of the appellant is not correct
- No tests have been done to establish as to whether the Appellant's final product has
the characteristics of cold rolled product – Order set aside and appeals allowed:
CESTAT [ para 6.1,7, 9]
2015-TIOL-812-CESTAT -DEL
M/s Honda Motorcycle And Scooter India Pvt Ltd Vs CCE (Dated: February 20,
2015)
Central Excise – CENVAT credit - appellants are manufacturer of motorcycle and
scooters; installed a paint shop and availed credit on the items deployed therein –
Revenue viewed that certain credit was inadmissible and merited recovery with
interest and penalty; in respect of (a) items embedded to earth, have become
immovable goods consequently the appellant is not entitled to take Cenvat credit; (b)
credit on air conditioner installed in the office premises has no nexus with
manufacture activity of the appellant; (c) the inputs sent for job work were not
received back by the appellant within the stipulated period of time and (d) credit
related to mould and dies which were not in the possession of the appellant for use –
demands adjudicated and agitated herein.
Held: In respect of (a), appellant eligible to avail credit in terms of the Omax Auto
ruling – Appellant did not contest demand in respect of (b) and (c); corresponding
demand confirmed with interest to be paid within 30 days of issue of this order –
Situation in (d) covered by Rule 4 (5) (b) of the Cenvat Credit Rules, 2004, wherein
the mould and dies are sent to the job workers for manufacturing intermediate
product, the appellant is entitled to take Cenvat credit; corresponding credit
admissible - No penalty is imposable on the appellant in the facts and circumstances
of the case.
2015-TIOL-810-CESTAT -DEL
M/s Indian Oil Corporation Ltd Vs CCE (Dated: February 25, 2015)
CX - Board vide Circular No. 798/31/04-CX had clarified that while the facility of
removal of petroleum products without payment of duty from a Refinery to a bonded
warehouse or from one bonded warehouse to another bonded warehouse has been
withdrawn w.e.f. 06/9/04 vide Notif No. 17/04-CE (NT) dated 04/9/04, the facility of
removal of petroleum products without payment of duty for export warehousing
continues to be available under Notification No. 46/01-CE (NT) – while reiterating this
position in Circular No. 804/1/2005-CX. dated 04/1/05 it was also clarified that for the
purpose of expo rts, separate storage of the duty paid and non -duty paid petroleum
products is not required - The only objection of the Department is that the Shakur
Basti Warehouse is not approved by the Commissioner and separate registration as
intermediate warehouse has not been obtained – CE duty demand of Rs.
20,14,29,960/- confirmed in respect of clearances of ATF to Shakur Basti Warehouses
during the period from 06/9/04 to 09/08/05 – appeal to CESTAT.
Held: Objection is without any basis, as immediately after amendment to Notification
No. 47/01-CE (NT) by Notification dated 04/9/04, the appellant under their letter
dated 13/9/04 addressed to the Commissioner had requested for converting the
existing bonded warehouse at Shakur Basti as export warehouse under Rule 20 for
export of ATF and in response to this Circular, the Department had clarified that since
they are already holding a Central Excise registration with the Division, the same
registration number would be used for intermediate export warehouse for export
clearances - this letter clearly shows that the required registration as intermediate
export warehouse has already been granted to the Shakur Basti Warehouse - In view
of this, the allegation in the SCNs that Indian Oil Corporation, Shakur Basti, New Delhi
is not a registered export warehouse and, therefore, is not entitled to receive duty
free ATF from IOC's Refinery at Panipat is absolutely without any basis – Order is not
sustainable, hence set aside - Appeals allowed: CESTAT [para 6]
2015-TIOL-806-CESTAT -MUM
Hindustan Coca-Cola Beverages Pvt Ltd Vs CCE (Dated: March 2, 2015)
CX - ROM application filed against order of Tribunal classifying the appellants' product
'Minute Maid Nimbu Fresh (MMNF)' under CSH 2202 10 20 as 'Lemonade' & holding
that same is not entitled for benefit of exemption notification 3/2006-CE. Held - It is a
matter of interpretation as to the meaning of words 'juice concentrate' and lime - On
the contention that PFA criteria was not under consideration in O -I-O, Tribunal has
discussed matter with reference to a technical note produced by the appellant during
course of arguments - Tribunal did consider the judgment of Parle Agro Pvt. Ltd. and
distinguished it by stating that in case of Parle, the product 'Appy Fizz contained far
more and higher significant percentage of apple juice i.e. 23% - Decision of Tribunal is
based on totality of various factors including HSN Notes on which CE Tariff is based Description on product did use the word 'Lemonade' - Similarly when there is doubt as
to the classification of a common product reference to a standard encyclopedia such
as Britannica may be made for guidance and to remove doubts - Last line in Para 8 of
Tribunal order i.e. "the juice content is admittedly only 1%" may be read as "the juice
concentrate is admittedly only 1%" - ROM application rejected as there is no 'mistake
apparent from the record': CESTAT [Para 5, 6, 7, 8]
2015-TIOL-805-CESTAT -DEL
M/s Indian Oil Corporation Ltd Vs CCE (Dated: February 19, 2015)
CX - Assessee are depots of IOCL and they are receiving duty paid petroleum products
from refineries - They are selling goods on the price fixed by Government of India Revenue views that the price at which goods are sold from depot are higher than the
goods cleared from refineries and goods are duty paid - As per Hindustan Petroleum
Corporation Ltd. 2012-TIOL-619-CESTAT-MUM-LB, duty is payable by manufacturer or
producer of goods while assessee is not a manufacturer or producer of goods,
therefore not liable to pay duty under section 11(D) of CEA, 1944 - Appeal allowed:
CESTAT [Para 9, 10]
2015-TIOL-800-CESTAT -DEL
CCE Vs M/s B D Gupta (Dated: March 12, 2015)
CX - Respondent is a second stage dealer of iron and steel items and claimed to have
received consignment of scrap from Adhunik Alloys Ltd and which was subsequently
sold to Kisco Casting who took CENVAT credit of Rs.4 ,15,844 /- based on the said
invoices - a llegation of department is that in all these invoices issued by the
respondent firm, the vehicles Nos. were of two wheelers, three wheelers, tankers etc.,
in which the goods claimed to have been supplied by the respondent firm to M/s Kisco
Casting could have not have been transported - credit of Rs.4,15,844 /- denied to
Kisco Casting and an equivalent penalty imposed on respondent & penalty of Rs.2
lakhs on proprietor of respondent firm - Commissioner(A) setting aside order and,
therefore, Revenue is in appeal before CESTAT.
Held: CENVAT - When the burden of proving that the material covered under the
invoices issued by the respondent firm had actually been received by M/s Kisco
Casting is on them, it is M/s Kisco Casting who has to lead the evidence of having
actually received the goods covered under the invoices issued by the respondent firm,
and they cannot do so by picking the holes in the Department's case or shifting the
burden of proof to the Department - The burden of proof will shift to the Department
only when M/s Kisco Casting have produced credible evidence in support of their claim
of receipt of the goods covered under the invoices issued by the Respondent - the
impugned order is not sustainable, same is set aside and the matter is remanded to
the Original Adjudicating Authority for de novo adjudication: CESTAT [ para 5]
Penalty - There is no justification for imposition of separate penalty on its proprietor Punjab & Haryana High Court in the case of Vinod Kumar Gupta vs CCE 2012-TIOL324-HC -P&H -CX has held that the proprietorship firm and its proprietor cannot be
treated as two different legal entities and in that view, the second penalty on the
proprietor in addition to the penalty on the proprietorship firm would amount to
imposition of penalty twice over, which is not sustainable in the eyes of law - Revenue
appeal to this extent is dismissed: CESTAT [ para 6]
2015-TIOL-799-CESTAT -MUM
Tien Yuan India Pvt Ltd Vs CCE (Dated: March 13, 2015)
CX - Clandestine removal of Terpene - Once the demand is confirmed invoking the
proviso to Section 11A(1) of the CEA, 1944, imposition of penalty u/s 11AC is
mandatory and automatic - contention of the appellant that adjudicating authority had
not imposed any penalty is clearly wrong - ROM dismissed: CESTAT [para 3, 3.1, 4]
Also see analysis of the Order
2015-TIOL-798-CESTAT -DEL
M/s Hotline CPT Ltd Vs CCE (Dated: December 24, 2014)
Central Excise - CENVAT credit - Returned goods - appellant, manufacturer of color
picture tubes (CPT), received back defectives which were accounted for under Rule 16
of the CER 2002 and credit was availed on the returns - the goods were dismantled,
refurbished and re cleared on payment of duty - Revenue viewed that since in the remaking of the CPTs some Cenvat credit availed parts/inputs are used and since re making does not amount to manufacture, they would not be entitled to Cenvat credit
in respect of the fresh parts used for re-making of the CPTs - demand for recovery of
credit with interest and penalty under Rules 14 & 15 of CCR 2004 read with proviso to
Sec 11A(1), 11AB and 11AC adjudicated, upheld by Commissioner (Appeals) and
agitated herein.
Held: Under the provisions of Rule 16 of the Central Excise Rules, 2002, when duty
paid goods are returned to the factory of manufacture, for being repaired, remade,
refined, reconditioned, etc., the manufacturer take the cenvat credit of the duty
originally paid and thereafter in terms of provisions of sub -rule (2), at the time of
clearance of the repaired/remade goods, if the process undertaken does not amount
to manufacture, he is required to pay the duty amount equal to the cenvat credit
taken, but if the process amounts to manufacture, he is required to pay the duty
chargeable on the goods at the rate applicable on the date of removal and on the
value determined under the provisions of Section 3(2), Section 4 or Section 4 A, as
the case may be - Rule 16 does not provide that Cenvat credit in respect of the inputs
used in the pro cess of repairing/refining would not be available - In identical
circumstances, Tribunal in Maruti Udyog and Tudor (I) cases, held the process to be
manufacture - Also, appellant had disclosed the process undertaken by them in
respect of the defective CPTs received from their customers and hence, the
department cannot allege suppression of facts - merit in the appellant's plea that they
correctly availed the Cenvat credit on input and the same cannot be denied impugned order set aside. [Para 5]
2015-TIOL-797-CESTAT -DEL
Bright Brothers Pvt Ltd Vs CCE (Dated: February 13, 2015)
CX - Duty demand of Rs.25,14,220 /- based on the allegation that the appellant have
inflated their raw material consumption/plastic granules and the excess consumption
of CENVAT Credit availed plastic granules has actually been cleared without reversal
of the credit - This allegation is based on the weight of the various plastic components
as determined by the actual availment and the weight of the same component as
intimated by the officials of the appellant company, as per their knowledge - Just on
the basis of the weight intimated by the appellants' officials and the actual availment
of the component, it cannot be presumed that the appellant have inflated the
consumption of raw material and have cleared the alleged excess consumption
without reversal of the credit - Demand set aside: CESTAT [ para 7]
CX - Shortage of finished goods and non -amortization of value of moulds and dies in
AV of finished goods - duty rightly demanded - Where short payment of duty is
accepted and paid before issuance of SCN in view of Delhi High Court decision in K.P.
Pouches 2008- TIOL -240-HC -DEL-CX penalty is reduced to 25%: CESTAT [ para 6, 9]
2015-TIOL-796-CESTAT -AHM
M/s Hindustan Pencil Pvt Ltd Vs CCE & ST (Dated: December 30, 2014)
Central Excise – Excisability - appellant is engaged in the m anufacture of Pencil
classifiable under Chapter heading 96.09 of the Central Excise Tariff Act, 1985;
engaged Job Worker for manufacturing Pencil Lead, which is also classifiable under
heading 96.09 - The said job worker prepared mixture of natural Graphite and natural
Bentonite (clay) captively consumed for manufacturing Pencil Lead - Revenue viewed
that the mixture of natural Graphite and natural Bentonite (clay) would be classifiable
under heading No. 38.01 and Central Excise duty is leviable; the job wo rker
discharged duty during the period March 2006 to December 2006 which was claimed
as refund by the appellant herein - the claim was rejected in adjudication on the
ground that mixture of natural Graphite and natural Bentonite (clay) is excisable and
the job worker has rightly paid the duty – Commissioner (Appeals) upheld the
rejection both on merits and unjust enrichment, agitated herein.
Held: Tribunal in the case of Umesh Pencil Processors held that mixture of natural
Graphite and natural Bentonite (clay) would not amount to manufacture; the same is
upheld by the Apex Court; hence the instant refund is admissible on merits - appellant
should be given an opportunity to substantiate their case on the eligibility to refund
claim and on unjust-enrichment - impugned order is set-aside; appeal allowed on
merits; however adjudicating authority is directed to examine the eligibility to refund
claim, unjust-enrichment and other issues. [Para 5, 6, 7]
2015-TIOL-787-CESTAT -DEL
M/s Avtec Ltd Vs CCE & ST (Dated: March 25, 2015)
CX - Assessee during the course of manufacture of final product, sent certain
processed goods to job workers for further processing - Revenue views that appellant
is required to pay duty on scrap generated at job workers end - As per Fag
Engineering India Ltd 2011-TIOL-2033-CESTAT-AHM , duty is being demanded by
treating them as a manufacturer of waste and scrap which is factually incorrect - In
fact, manufacturer of waste and scrap is job worker, therefore, duty cannot be
demanded from principle manufacturer - Assessee is not required to pay duty on
waste and scrap generated at job workers end: CESTAT [Para 6, 7]
2015-TIOL-786-CESTAT -DEL
M/s Dharampal Satyapal Ltd Vs CCE (Dated: March 25, 2015)
CX - Pan Masala - Pan Masala Packing Machines (Capacity Determination and
Collection of Duty) Rules, 2008 - It is well settled law that a casus omissus cannot be
provided by the Courts or the Tribunals - Machine, in question, is a single track duplex
machine - Just because the speed of this machine is about two times the packing
speed of simplex model, it cannot be treated as a multiple track machine - Amending
notifications of year 2015 taking into account the maximum packing speed while fixing
the duty liability is not retrospective - Demand of Rs.25.98 crores & penalties set
aside - Appeals allowed: CESTAT [para 6 to 11]
Also see analysis of the Order
2015-TIOL-785-CESTAT -DEL
M/s Dhanjjal Industries Vs CCE (Dated: March 24, 2015)
CX - Manufacture - Assessee are engaged in the process of crushing of manmade
fabrics with the aid of power - Revenue views that process of crushing would amount
to manufacture - Assessees have accepted that the crush fabrics, as such, are sold It has to be held that process of crushing results in permanent change in fabrics and,
hence, in view of Chapter Note 4 of Chapter 55, this process would have to be treated
as amounting to manufacture and process of crushing would be covered by expression
"any other process" - No infirmity in impugned order holding that the process of
crushing would amount to manufacture - Duty demands are within normal period of
limitation and hence same are upheld - Since the dispute pertains to interpretation, no
malafide can be attached to non-payment of duty by assessees on crush fabrics being
cleared by them - Penalty on both the assessees is set aside - Appeals of both the
assessees are partly allowed: CESTAT [Para 6, 7, 8, 9]
2015-TIOL-784-CESTAT -DEL
Abc Paper Vs CCE (Dated: February 12, 2015)
CE - Notification 6/2002-CE, 4/2006-CE - Manufacture of paper in same factory When it is the appellant who is liable to pay duty on the paper and not the job worker
who converted pulp into paper rolls on job work basis, the exemption under these
notifications cannot be denied as long as other conditions have been satisfied Appeals allowed: CESTAT [ para 5]
Also see analysis of the Order
2015-TIOL-783-CESTAT -MUM
CCE Vs Greaves Cotton Ltd (Dated: February 03, 2015)
CE - Valuation - s.4 of CEA, 1944, Rule 8 of Valuation Rules, 2000 - Assessee is
manufacturing ‘diesel engine model FL -400' and clearing the same to related party Period of dispute is 1.7.2000 to 31.8.2001 - During the said period they had paid duty
on the basis of Cost Accountant's certificate dated 7.8.2000 - Another report of cost
auditor was available for the period ending 30.9.2001 - Amounts indicated in two
certificates under head ‘Material Cost' and ‘Other costs/overheads' were different - It
is not app ropriate on part of Revenue to take material cost as per certificate dated
7.8.2000 and take "other cost/overheads" on the basis of certificate dated 30.9.2001
- Certificate dated 30.9.2001 represents correct cost of production and said cost is
less than AV on which assessee had paid duty - No merit in appeal of revenue, so,
dismissed: CESTAT [Para 3, 4, 5]
2015-TIOL-780-CESTAT -MUM
Echjay Forgings Pvt Ltd Vs CCE (Dated: March 03, 2015)
CENVAT - Rule 9(1) and 9(2) of the CCR, 2004 do not invalidate invoices issued in the
course of Transit sale - Once receipt of inputs, admissibility of credit and subsequent
usage of the same is not in doubt and goods have been legitimately procured in the
course of transit sales, an accepted business practice, credit cannot be denied Appeal allowed: CESTAT [para 4, 5]
2015-TIOL-773-CESTAT -DEL
B S B K Engineers Pvt Ltd Vs CCE (Dated: January 1, 2015)
CX - SSI exemption - Appellant company in their factory manufactures ash handling
equipment and a part of premises has been rented out by them to another company
(MBPL) - Both units during period of dispute were independently availing SSI
exemption - Exemption is sought to be denied to appellant company by clubbing its
cleara nces with the clearances of MBPL - Evidence relied upon by Department, at the
most indicates mutuality of interest, but it does not prove that appellant company and
MBPL are owned by same person - Since there is no shareholding of appellant
company in MBPL, on the basis of individual shareholding of Directors of appellant
company in MBPL, latter cannot be treated as subsidiary company of appellant
company - Registered offices of both companies being at the same address or that
plant and machinery of one company having been pledged to Bank as a security for
the loan sanctioned by bank to the another, by themselves cannot be treated as the
evidence that both the units are owned by same person or that appellant have all
purvasive financial operational and management control over MBPL or vice versa - On
merits also, there is no justification for clubbing the clearance of appellant company
with clearance of MBPL for determining eligibility for SSI exemption of appellant
company - Impugned order is not sustainable, same is set aside and appeal allowed:
CESTAT [Para 6, 7, 8]
2015-TIOL-772-CESTAT -DEL
M/s F S Chemicals Pvt Ltd Vs CCE (Dated: February 4, 2015)
CX - Assessee manufactures a product called "organic composite solvent" and classify
under heading 3814 of the Central Excise Tariff, while Revenue views that goods are
"other motor spirit" classifiable under sub-heading 27101119 of the Central Excise
Tariff - Chemical examiner's report while mentioning the flash point as below 25°C is
totally silent about other factor as to whether the product either by itself or in
admixture with other substance is suitable for use as a fuel in spark ignition engines,
hence, product cannot be classified under heading 27101119 - Appeal allowed:
CESTAT [Para 6]
2015-TIOL-771-CESTAT -MAD
M/s Automotive Coaches And Compone nts Ltd Vs CCE (Dated: February 18,
2015)
Central Excise - CENVAT credit - feasibility study for setting up unit done; credit of tax
paid toward it availed; same denied in adjudication and agitated herein. Held:
Impugned credit admissible since the input services definition in Rule 2(l) would
permit cenvat credit for such services which has nexus with business [Para 1]
2015-TIOL-769-CESTAT -DEL
Gail Gas Limited Vs CCE & ST (Dated: February 10, 2015)
CX - Assessee in ER -I return for September, 2001 had showed duty payable as
Rs.1,29,541/- and they had also shown cenvat credit balance which was more than
sufficient to discharge duty liability - Merit found in assessee's plea that non -payment
of duty, which is a small amount for such a big company, was due to bonafide mistake
- When provisions of Rule 8 (3A) of CER, 2002, requiring an assessee to pay duty
through PLA without utilizing credit during the period of default beyond the period of
one month have been declared as unconstitutional, impugned order itself would not
be sustainable - Said order has been passed without any application of mind at all Stay granted: CESTAT [Para 5, 6]
2015-TIOL-767-CESTAT -DEL
M/s Decotouch Paints Ltd Vs CC, CE & ST (Dated: January 12, 2015)
CE - Assessee are manufacturers of wall putti, cement and paints which were sold
under brand name "Decotouch' and 'Diamond gold' and were availing SSI exemption Revenue views that these brand names do not belong to assessee but are registered
in name of M/s. Diamond Water Proof Compound Ltd., who have assigned these brand
names under two assessment deeds to M/s. Diamond Retail Mart who, in turn, has
assigned these brand names to assessee - Assessee were also using brand name
"Ultra White", "Korean", "Samsung" Champion" and "Diamond Gold", Revenue has not
identified as to whom these brand names belong, hence, assessee cannot be deprived
of benefit of SSI exemption in respect of these goods - As per Vikshara Trading &
Invest P. Ltd. 2003-TIOL-97-SC-CX, SSI exemption is allowed under notfn 175/86CE and 1/93 - Amount already deposited by assessee is sufficient for hearing of
matter - Stay granted: CESTAT [Para 8, 9]
2015-TIOL-766-CESTAT -MUM
Alarsin Vs CCE (Dated: April 1, 2015)
CENVAT - Omission to take registration as an Input Service Distributor is to be
considered as procedural irregularity - Division bench decision needs to be followed
giving precedence over decision of Single Member Bench – Appeal allowed: CESTAT
[para 6, 7]
Also see analysis of the Order
2015-TIOL-765-CESTAT -MUM
Accosoic Controls Pvt Ltd Vs CCE (Dated: March 18, 2015)
CX - Rule 6 of CCR, 2004 - Issue is regarding reversal of an amount equivalent to
10% of the value of goods cleared to SEZ developer by availing exemption Notfn Issue is no more res integra - As per Steel Authority of India Ltd. 2013-TIOL-384-HC CHATTISGARH-CX , there cannot be a discrimination between SEZ developer and SEZ
unit - no cause for reversal/payment of amount in terms of rule 6 of CCR, 2004 Appeal allowed: CESTAT [Para 4, 7]
2015-TIOL-764-CESTAT -DEL
M/s Ercon Composites Vs CCE & ST (Dated: November 24, 2014)
Central Excise - Exemption - appellant are engaged in manufacture of Glass Fibre,
Channels, Angles, Rods, Tower, Window Rods etc., cleared to ONGC's contractor
without duty under notification No.6/2006-CE [Sl.No.19] and 21/2002 -Cus
[Sl.No.214/ condition No.29] - Exemption denied in adjudication on the ground that
the required certificate from the Directorate General of Hydro Carbons was not
produced; duty demand along with interest and penalty under Section 11 AC
confirmed; upheld by Commissioner (Appeals) and agitated herein.
Held: Appellant had supplied the goods by availing full duty exemption under
Notification No. 6/06-CE (Sl. No. 19) against international competitive bidding to M/s
Essar Offshore Subsea Ltd. who were to use these goods for petroleum operations of
ONGC - no dispute that the same goods if imported into India would be exempt from
basic customs duty as well as additional customs duty in terms of Sl. No. 214 of the
table to the notification subject to the fulfillment of the certain conditions prescribed only point of dispute is regarding the condition regarding production of certificate from
Directorate General of Hydro Carbon; this very issue stands decided in the appellants
favour by the Bombay Bench of the Tribunal in the case of Kent Introl Pvt. Ltd.,
wherein it was held that the condition No. 29 referred of the Notification No. 21/02CUS (Sl. No. 214) regarding production of a prescribed certificate for Directorate
General of Hydro Carbons is not applicable to the sub-contractors who are domestic
manufacturers - impugned order is not sustainable; and the same is set aside. [Para
6]
2015-TIOL-763-CESTAT -AHM
M/s Atcom Technologies Ltd Vs CCE & ST (Dated: March 27, 2015)
CX - MODVAT/CENVAT - Relevant date for determination of availability of
MODVAT/CENVAT credit is the date of receipt of capital goods in the factory and if on
that date credit was not admissible, it cannot be allowed subsequently: CESTAT
2015-TIOL-757-CESTAT -MAD
Audco India Ltd Vs CCE (Dated: February 23, 2015)
Central Excise - Demand - appellants are manufacturers of industrial valves;
investigation revealed that they have not paid appropriate excise duty on the scrap
generated at the job worker premises from the goods sent and processed under rule
57F (4) of Central Excise Rules, 1944 and they also removed capital goods to their job
workers premises without reversal of credit - Demands adjudicated with interest
under various sub rules of Rule 57U apart from penalty under Rule 173Q of erstwhile
CER 1944 - When the matter was agitated before the Tribunal, the demand was
upheld and the penalties imposed under Section 11AC, 57U and 173Q and the interest
demanded under Section 11AB and under Rule 57U (8) were all set aside - Revenue
took the matter to the HC who remanded it for denovo consideration.
Held: Gross violations clearly brought out in the findings of the adjudication order;
evident from the records that the appellants have paid the duty only on 9.3.99 i.e.
after the department detected the duty evasion - Since the suppression of facts is
established beyond doubt the adjudicating authority has rightly invoked Section 11AC
and Section 11AB for imposition of penalty and the interest and rightly restricted the
penalty under Section 11AC and interest under Section 11AB only on the demand
amount covered for the period from 28.9.1996 - . As held by the apex court in the
Dharmendra Textile Processors case, once mens rea with intention to evade payment
of duty is established, penalty is sustained [Para 9]
Appellants are liable for penalty under Section 11AC, interest under Section 11AB and
under Rule 57 U (6) and Rule 57U (8) of CER prospectively for the demand a mount
covered from 28.9.96 - in the present case, the appellants have not complied the
provisions of Section 11AC as they have not paid the interest demanded under
Section 11AB and the reduced penalty within 30 days of the communication of the
adjudication order; their case is not covered under 3rd proviso of Section 11AC - their
letter dt. 19.11.2009 addressed to Range Superintendent informing that they have
remitted 25% of total penalty under Section 11AC under protest after receipt of the
High Court orde r is not acceptable - no evidence to show that payment of interest
demanded under Sec 11AB and Rule 57U(8); and reduced penalty paid before 30 days
of receipt of adjudication order - impugned order sustainable and the appellants are
not eligible for the reduced penalty of 25% of the duty amount - impugned order is
upheld except waiver of penalty under Rule 173Q. [Para 10, 11]
2015-TIOL-756-CESTAT -MUM
Shri Ghanshyamdas C Goyal Vs CCE (Dated: April 15, 2015)
CX - Co-appellant cannot be exonerated from penalty imposed u/r 26 of CER, 2002
even if the main appellant has paid the duty, interest and 25% of penalty in terms of
proviso to Section 11A(2) of CEA, 1944 - Immunity is available to only those persons
to whom the notice is issued u/s 11A(1) - However, considering the fact that total
amount of duty confirmed of Rs. 2,79,803/-, interest and 25% of penalty has been
paid by the main appellant, personal penalty of Rs. 50,000/ - imposed on the co appellant is higher side, therefore, same reduced to Rs. 25,000/- - Appeal partly
allowed: CESTAT [para 5]
Also see analysis of the Order
2015-TIOL-755-CESTAT -DEL
Bajaj Motors Ltd Vs CCE (Dated: February 11, 2015)
CENVAT - Rule 2(l) of CCR , 2004 - Credit sought to be denied on the ground that in
the invoices, the name of the service was not mentioned - Manpower recruitment
agency mentioned in the invoice instead of Man power recruitment service - input
service cannot be denied on this ground - order set aside to this extent: CESTAT [
para 6]
CENVAT - Outdoor Catering Service - Rule 2(l) of CCR , 2004 - As per amended
statute with effect from 1.4.2011, outdoor catering service has been excluded from
the definition of input service - appellant is not entitled to take Input service credit on
Outdoor catering service of Rs.78 ,312 / - - provision denying input service credit on
outdoor catering service came into existence with effect from 1.4.2011 - accumulated
SCN issued to the appellant in 2012 by invoking the provision of Rule 2(l) of CCR ,
2004 as existed prior to 2011 - Therefore, penalty is not imposable on the appellant,
interest payable: CESTAT [ para 7]
2015-TIOL-754-CESTAT -DEL
M/s A K Multimetals Vs CCE & ST (Dated: February 27, 2015)
CENVAT - Rule 9 of CCR , 2004 - Assessee is required to ensure that the input on
which Cenvat Credit is taken the relevant document is accompanied or not Admittedly, in this case the appellant is able to produce the invoice against which
appellant has availed Cenvat Credit and same has been entered in their RG -23
Register - appellant also produced weightment slips before adjudicating authority Therefore, the burden is cast on the revenue to prove that this is only a paper
transaction and goods have not been received by the appellant at all - as revenue
failed to do so, cha rge against the appellant that they have not received goods and it
was only the paper transaction is not sustainable - Appeal allowed with consequential
relief: CESTAT [ para 8, 9]
2015-TIOL-753-CESTAT -AHM
M/s Alfa Synthetics Vs CCE (Dated: December 31, 2014)
Central Excise - Clandestine clearances - appellants were engaged in manufacture of
Polyester Texturised Yarn; officers visited factory premises and detected shortage of
physical stock of finished goods vis -a-vis RG1 - Confiscation with RF option; Duty
demand confirmed with interest in adjudication and penalties imposed on firm [Sec
11AC of Central Excise Act 1944] and individual [under Rule 209A of the Central
Excise Rules 1944]; upheld by Commissioner (Appeals) and agitated herein.
Held: Appellant paid the entire amount of duty along with interest and penalty of 25%
of the duty so determined within 30 days of communication of the adjudication order;
hence balance amount of penalty as imposed is liable to be waived under clause (c) of
Section 11AC(1) - the goods are not available; Tribunal ruling in Kay Bee Tax Spin
case applicable; and therefore, the confiscation of the goods and imposition of RF is
not sustainable - penalty was imposed on the partnership firm under Section 11AC of
the Central Excise Act 1944 and therefore the penalty imposed on the partner under
Rule 209A of erstwhile rules is not justified in terms of the Gujarat HC ruling in Pravin
N Shah case - impugned order modified to the extent that penalty under Section 11AC
imposed on the appellant No.1 would be 25% of the duty as per Clause (c) of Section
11AC (1) of Central Excise Act 1944 and confiscation and redemption fine are set
aside - penalty on appellant No.2 is set aside. [Para 6, 7, 8]
2015-TIOL-746-CESTAT -DEL
Raj Laxmi Products Pvt Ltd Vs CCE (Dated: February 03, 2015)
Central Excise - Clandestine clearances - investigation launched by the DGCEI on the
appellant firm engaged in manufacture and sale of Ghutka/Pan Masala; who concluded
clandestine clearances, suppressed production and illicit transportation through
railways - demands adjudicated (a) against RPPL under proviso to Section 11A(1) of
Central Excise Act, 1944 along with interest under section 11AB ibid; amount paid by
them during investigation appropriated towards this demand, (b) penalty on RPPL
under section 11AC of Central Excise Act, 1944 read with Rule 25 of the Central Excise
Rule 2002; (c) confiscation of the cash seized from the residential premises of the
individuals (Shri Harish Kr. Makhija and Shri Hira Lal Makhija) under section 121 of
Customs Act, 1962 read with section 12 of the Central Excise Act, 1944 and (d)
penalty on each individual under rule 26 of the Central Excise Rule, 2002 - agitated by
the firm a nd individuals herein.
Held: The excess stock of Supari, Gutkha and Packing material by itself cannot be
treated as an evidence of unaccounted manufacture or clearance of 'Kimti' Brand
Gutkha by RPPL during the period to which the entries in the notebook recovered from
Shri Manoj Gupta pertain - For that period, there is no evidence of unaccounted
purchase of principal raw material - Regarding recovery of cash from the residential
premises of the individuals, in both the cases the stand of the appellant has been that
this cash was meant for purchase of some property and was not for the sale proceeds
of unaccounted Gutkha - in view of the judgment of the Apex Court in the Pandit DP
Sharma case, the onus to prove that the currency represented sale proceeds of the
clandestinely removed goods in on the department and it is the department which has
to lead cogent evidence in this regard; absent in the instant case - currencies
recovered from the residential premises of the individuals cannot be held to be sale
proceeds towards the clandestinely cleared goods. [Para 6]
According to the statement of Shri Manoj Gupta, the entries represented the details of
the consignment of 'Kimti' Brand Gutkha booked through him with railways for
transportation and the same consis t of the railway receipt number, the number of
packages and the date of RRs - however, the Department has not obtained the copies
of the RRs from the railways, in absence of which it cannot be inferred as to whether
the RR numbers mentioned in the diary of Shri Manoj Gupta represent actual railway
receipts under which certain consignments had been booked - Although Shri Manoj
Gupta in his statement mentioned Shri Sumit Kumar stating that he used to be
informed by Shri Sumit Kumar about the arrival of the consignments for booking and
it is Shri Sumit Kumar who used to make cash payments for the same, but no enquiry
with Sumit Kumar, who during that period was an employee of RPPL, has been made
and absolutely no statement of Shri Sumit Kumar had been recorded - merely on the
basis of the entries in the notebook recovered from Shri Manoj Gupta under the
heading of 'Kimti' coupled with his statement, it cannot be concluded that those
entries represent clandestine clearances of the consignments of 'Kimti' Brand Gutkha
by RPPL and demand on this basis cannot be confirmed against RPPL - In this case,
even the railway receipts under which the consignments of 'Kimti' Brand Gutkha are
alleged to have been clandestinely cleared, had been booked are also not on record
and it is not known as to whether the RR numbers mentioned in the notebook of Shri
Manoj Gupta under the heading 'Kimti' represent the actual railway receipt or not;
therefore, the duty demand against RPPL is not sustainable - hence no question of
imposition of penalty on Shri Hira Lal Makhija and Shri Harish Kumar Makhija under
Rule 26 of the Central Excise Rule 2002 - impugned order unsustainable and set
aside. [Para 7, 8, 9]
2015-TIOL-745-CESTAT -AHM
M/s Ambica Organics Vs CCE & CC (Dated: March 4, 2015)
CX - Clandestine removal-Entire case was made out on the basis of statements of the
buyers and the computer printouts-Commr (A) has already held that the evidentiary
value of the similar pre-drafted computer statements is weak-Investigating officers
have failed to comply with the conditions of S. 36B of the Act in r/o relying upon
compute r print out - there is no adequate material available on record to establish the
clandestine removal of goods - Demand set aside and appeals allowed: CESTAT [ para
7, 10, 11]
Also see analysis of the Order
2015-TIOL-744-CESTAT -DEL
CCE Vs M/s Plethico Pharmaceuticals Ltd (Dated: March 16, 2015)
CX - Classification - "Travisile" lozenges and "Plethico Byte" are correctly classifiable
under heading 3004 of the CETA, 1985 as ayurvedic medicines as claimed by assesse "Actifresh"and"Plethico Mint"are classifiable as sugar confectionery under heading
1704 as proposed by Revenue and the Appellant would be liable to pay duty on this
basis alongwith interest-duty shall be quantified by the Assistant Commissioner Revenue appeal partly allowed: CESTAT [ para 9, 10, 11, 13]
2015-TIOL-740-CESTAT -DEL
M/s Jindal Photo Films Ltd Vs CCE (Dated: February 19, 2015)
CX - Refund - Assessee reduced the price and filed revised price list before authorities
- Assessee has given discount to their customers which contains reduction in price
plus duty - But, they continued to pay duty on the price indicated in original price list
- After approval of revised price list, assessee filed re fund claim of excess duty paid by
them - On perusal of calculation sheet and invoices provided by assessee, it is found
that while granting discount to their customers, assessee included the prices reduction
plus duty component and same has been ignored by lower authorities - Assessee has
been able to prove that they have not recovered excess duty from their customers Therefore, assessee has discharged burden of unjust enrichment and consequently, is
entitled for refund claim - Appeal allowed: CESTAT [Para 2, 8, 9]
2015-TIOL-736-CESTAT -DEL
M/s Bajrang Wire Products Pvt Ltd Vs CCE & ST (Dated: January 22, 2015)
Central Excise - CENVAT credit - input Cenvat credit on outward transportation
services denied in adjudication on the premise that although the goods are sold by the
appellants on FOR basis but in the invoice, freight is shown separately - demands
confirmed and agitated herein.
Held: In terms of the Ambuja Cement ruling read with Board Circular dated
23.08.2007, assessee disentitled to credit of outward transportation service ineligible credit unearthed only with audit intervention, hence extended period rightly
invoked [Para 5, 6]
2015-TIOL-735-CESTAT -DEL
M/s Swastik Pipes Ltd Vs CCE (Dated: January 16, 2015)
CX - Assessee cleared pipes to Kerala Water Authority at nil rate of duty by availing
full duty exemption under notfn 6/2002-CE (Sl.No.196 A) as amended by notfn
47/2002-CE - Revenue views that the storage tank is located on the hill and the pipes
used for carrying water beyond that storage tank are not eligible for exemption - On
account of hilly area between water source and water treatment plant, the water had
to be carried to a temporary storage facility on hill by booster pumps, the temporary
water facility on the hill cannot be treated final storage facility and benefit of
exemption notfn can not be confined only to the pipes needed for the supply to
temporary storage facility on hill - Appeal allowed:CESTAT
2015-TIOL-733-CESTAT -DEL
M/s JCT Ltd Vs CCE (Dated: January 5, 2015)
CX - Refund - Assessment has been finalized upto spindle stage on 15.01.2004 - SCN
was issued to appellant for the same period although on some other ground - Once
the assessment is reopened then all issues can be raised by appellants and as such
the Adjudicating Authority was bound to consider refund claim on merits - When SCN
was issued on 29.12.2004 for the said period, appellant was at liberty to raise all the
issues in defence of SCN issued to them - Order dated 15.01.2004 is non est and non
cooperative - Impugned order set aside and matter remanded to adjudicating
authority: CESTAT [Para 5, 6, 7, 8]
2015-TIOL-732-CESTAT -MUM
CCE & C Vs M/s Shalini Plywood Pvt Ltd (Dated: February 18, 2015)
CX - 8/99-CE - Brand name - Denying SSI exemption & confirming the demand by
holding that brand name does not belong to the respondent company on the ground
that earlier the company was under different management is absurd and beyond
common sense - finding of Commissioner(A) is unambiguous and proper and legal Revenue appeal dismissed: CESTAT [para 5]
Also see analysis of the Order
2015-TIOL-731-CESTAT -MUM
Laurel Wires Ltd Vs CCE (Dated: February 9, 2015)
CX - Appeals of applicants were dismissed only on the ground of non -prosecution – As
per Balaji Steel Re-Roling Mills - 2014-TIOL-92-SC -C X-LB , appeal should be disposed
of on merit - Applications for restoration of appeals are allowed and appeals are
restored to its original numbers: CESTAT [Para 4, 4.1]
2015-TIOL-730-CESTAT -MUM
CCE Vs M/s Consolidated Hoists Pvt Ltd (Dated: February 18, 2015)
CX - Revenue in appeal - Duty amount involved is less than Rs. Five Lakhs - As per
Government Litigation Policy F.No. 390/MISC/163/2010/JC and decision in Presscom
Products 2011-TIOL-889-HC -KAR-CX , Revenue appeal is dismissed without going into
merit of issue: CESTAT [para 1]
2015-TIOL-724-CESTAT -MAD
K G Naidu Mills Vs CCE (Dated: December 11, 2014)
Central Excise - Valuation - instant dispute as to whether (a) transportation cost of
input sent to the job worker's premises shall be included in the assessable value of
the goods manufactured by the said job worker; and (b) the handling charges
incurred by the job worker-appellant for unloading the goods by its own workers shall
be includible in the assessable value.
Held: Written submissions filed by the appellant do not disclose whether the
transportation cost can be disintegrated from the contract between the manufacture
and the job worker; unless there is a clear disintegration made out by evidence, the
appellant fails on this count - handling charges are integrally connected with the input
coming to the premises of the job worker and cannot be disintegrated - For no
disintegration, appeal fails on this count also - It does not make difference to law as
to whether unloading is done by workers from outside or own workers of appellant
since every acti vity involves cost whether expressed or intrinsic - non inclusion of
value of cost of waste arising during the course of manufacture is not raised by the
appellant in the written submissions nor in appeal; Tribunal cannot create a
jurisdiction for itself to decide the issue not before it. [Para 2, 3, 5]
2015-TIOL-719-CESTAT -DEL
M/s Dinesh Tobacco Industries Vs CCE & ST (Dated: January 15, 2015)
Central Excise - Annual Capacity based duty - appellant are manufacturing ' Sada Pan
Masala' as well as 'Zarda' and governed by Rule 10 of Pan Masala Packing Machine
(Capacity Determination and Collection of Duty) Rules 2008 and Chewing Tobacco and
Unmanufactured Tobacco Packing Machines (Capacity Determination and Collection of
Duty) Rules 2010 - duty unpaid for period of closure and belatedly paid pro rata for
working period - Revenue viewed duty payable as per ACDO, confirmed demands,
agitated herein.
Held: In terms of the Candex Chemical Fibres ruling, appeal against demand under
ACDO by Commissioner (Appeals) before the Tribunal held maintainable - on merits,
Division bench order in Shree Flavors case squarely applicable - the factory of the
appellant was closed for the period 25.07.2012 to 21.08.2012 and duty was not paid
by the appellant on 05.08.2012 as their factory was not functioning but when the
factory started functioning on 22.08.2012 they have paid the duty on 24.08.2012 appellant liable to pay interest for the period of 05.08.2012 to 24.08.2012 which
stands paid; appellant is not required to pay duty; impugned order is set aside [Para
6, 7, 8]
2015-TIOL-718-CESTAT -DEL
M/s Ess Kay Enterprises Vs CCE (Dated: January 20, 2015)
CX - Whether during the period of default in discharge of monthly duty liability for a
particular month beyond the period of one month from due date, the assessee is
required to pay duty without utilising the Cenvat credit - In the case of Indsur Global
Ltd 2014-TIOL-2115-HC -AHM-CX Gujarat High Court has gone into the
constitutionality of provisions of Rule 8 (3A) and has held in clear terms that the
condition contained in sub-Rule (3A) of Rule 8 for payment of duty during the period
of delay beyond the period of one month from the due date without utilising the
Cenvat credit, till the Assessee pays outstanding amount is constitutional - Stay
granted: CESTAT [Para 6]
2015-TIOL-717-CESTAT -DEL
Farmparts Company Vs CCE & ST (Dated: February 5, 2015)
CX - Assessee engaged in manufacture of Tractor Parts and Forging - On physical
verification of goods, they were contained 52 pallets and 85 cardboard cartons (duly
packed containing Tractor parts and forgings) which were lying unaccounted in the
factory premises of assessee and were in fully finished condition - If preventive staff
did not visit factory premises of assessee, fully finished goods would have been
cleared clandestinely - Goods are liable for confiscation and consequently redemption
fine and penalty are imposable - Goods were meant for export, therefore, redemption
fine is reduced to -Rs.1 lakh and penalty is reduced to Rs.50,000/ -: CESTAT [Para 6,
7]
2015-TIOL-716-CESTAT -MAD
M/s GTP Granites Ltd Vs CCE (Dated: February 3, 2015)
Central Excise - Exemption - goods procured duty free by the EOU appellants were
used for raising of granites from the quarries owned by State of Tamilnadu - Revenue
denied benefit of Notification No. 37/2000-CE dated 8.5.2000 on the ground that the
appellant neither owned nor leased the land from which granite was lifted;
adjudicated demands, agitated herein.
Held: The appellant was user of the land in accordance with agreement - Under Rule
8A of Tamilnadu Minor Mineral Concession Rules, 1959, grant of quarry lease is the
domain of the State Government, who has equal power to permit use thereof under
any other arrangement for raising the output from the quarry - Since the quarry
belongs to the State and appellant was user thereof, the goods procured withou t
payment of excise duty used in quarrying granite and processing thereof for export is
not disentitled to exemption benefit under the notification - Not owing lease has not
debarred the appellant to quarry granite and process the same; if the condition of
processing of procured granite from the quarry of the State under an agreement is
fulfilled by the 100% EOU appellant, benefit of the notification is undeniable since any
denial thereof would defeat the object thereof. [Para 4]
2015-TIOL-715-CESTAT -MAD
M/s The Lakshmi Mills Co Ltd Vs CCE (Dated: January 7, 2015)
Central Excise - Valuation - simple question involved herein is whether the goods
processed by a processor belonging to the appellant when cleared for delivery at the
depot of the appellant shall be liable to duty.
Held: The manufacturing process was indeed carried out and the goods sent by the
appellant to the processor upon payment of duty had undergone value addition - The
impugned goods all along carried the title of the appellant till delivered at its depot;
hence the value addition is not immune from duty.
2015-TIOL-714-CESTAT -MUM
M/s Cadbury India Ltd Vs CCE (Dated: March 10, 2015)
CX - Rule 6 of CCR, 2004 - Cocoa Shells arise unavoidably during the process of
manufacturing cocoa butter and cocoa powder from cocoa beans - they are nothing
but by-product or waste - no question of payment of any amount under rule 6(2) of
CCR, 2004 when Cocoa shells are cleared at Nil rate of duty - [para 5] Also see analysis of the Order
2015-TIOL-713-CESTAT -MUM
Asiatic Gases Ltd Vs CCE (Dated: January 22, 2015)
CX - Appellant is manufacturing acetylene gas on job-work basis and principal is
supplying inputs - Appellant is paying excise duty on sale -price at which the goods are
sold by their principal - Revenue's contention in applying the value of comparable
goods is not agreeable - It is settled law that prices of different class of buyers can be
different, and same is acceptable - Value adopted by appellant job worker is correct
and legal and is as per settled law Ujagar Prints - 2002-TIOL-02-SC-CX - Order set
aside and appeal allowed: CESTAT [Para 5, 6, 8, 9]
2015-TIOL-712-CESTAT -MUM
G R Woolen Mills Pvt Ltd Vs CCE (Dated: January 21, 2015)
CX - Assessee clearing the goods on payment of duty and also without payment of
duty under Notfn 29/2004-CE and Notfn 30/2004-CE - In manufacture of said item
they are also using plastic packaging material - Assessee has given the data relating
to packaging material on which they have availed Cenvat credit and on which they
have not availed Cenvat credit - Benefit of said Notfn is available only when no credit
on inputs is taken - Appellant has not produced said data to show that they have not
availed or utilized packaging material (on which credit of duty was taken) in
manufacture of exempted goods - Rule 6(3) of CCR is not relevant as exemption itself
is subject to condition of non-availment of Cenvat Credit on inputs – Case remanded
to original authority: CEST AT [Para 2, 6] -
2015-TIOL-711-CESTAT -MUM
M/s Aquapharm Chemical Pvt Ltd Vs CCE (Dated: January 8, 2015)
CX - Appellant, a 100% EOU cleared by-product namely Hydrochloric Acid in domestic
market on payment of excise duty by availing concessional Notfn 23/2003-CE Revenue contends that by-product was cleared without obtaining permission for DTA
sale, so, they are not entitled for concessional rate of duty under said notfn Appellant referred to LOP, which was issued in respect of by-product i.e. Hydrochloric
Acid - As per Circular 31/2001-Cus, if LOP in respect of by-products is obtained, it is
sufficient requirement for sale of byproduct in DTA - Matter remanded to original
adjudicating authority with directions: CESTAT [Para 5]
2015-TIOL-707-CESTAT -MAD
M/s Wabco India Ltd Vs CCE (Dated: February 6, 2015)
Central Excise - CENVAT credit - input services credit availed on (i) Warranty Services,
(ii) Photograph Services, (iii) Hotel Bills/ Labour Charges for poori/chapathi
preparations, (iv) Canteen Equipment Alterations, (v) Guest House Maintenance and
Ayudha Pooja Work, (vi) R&D Services, (vii) Advertisement for Board Meeting and
(vii) Ticket Booking & CH/AAA denied in adjudication and agitated herein.
Held: So far as the service tax paid on the Warrant Services, Photograph Service,
Canteen Equipment Alteration Services and R&D Services are concerned the reasoning
given by the appellant acceptable insofar as the relevancy of the expenditure to the
manufacturing and business activities of the appellant is appreciable - credit of the
quantum on these services shall be admissible and the other services are not
qualifying for eligibility to Cenvat credit for no good reason stated. [Para 3].
2015-TIOL-705-CESTAT -DEL
M/s Gallant Ispat Ltd Vs CCE & ST (Dated: January 22, 2015)
CENVAT-Welding electrodes were used to remove runners and risers from the ingots
and sometimes for cutting of steel bars and billets etc. -welding electrodes also used in
fabrication /manufacture of capital goods of plant and machinery-Credit is admissible appeals allowed: CESTAT [ para 6]
2015-TIOL-704-CESTAT -AHM
Banco Products India Ltd Vs CCE, C & ST (Dated: December 17, 2014)
CX - CENVAT - Appellants are engaged in the manufacture of Radiators and Gaskets
(Ch 84 and 87); paid ST under reverse charge mechanism on Commission paid to
their agents outside India and availed CENVAT credit thereon - credit denied along
with imposition of interest and penalty on the ground that no material is available on
record that the activity of the foreign agent is in the nature of sales promotion Gujarat High Court in the case of Cadila Healthcare Ltd had observed that it is to be
decided on the basis of materials on record as to whether the services were sales
promotion or otherwise - Adjudicating authority should have examined the documents
as enclosed with the reply to SCN before arriving at a conclusion - Matter remanded:
CESTAT [para 6, 7]
2015-TIOL-698-CESTAT -AHM
M/s Astra Lifecare India Pvt Ltd Vs CCE & ST (Dated: February 23, 2015)
CE - Refund of unutilised balance of CENVAT Account - Assessee engaged in
manufacture of Pharmaceutical products and availing facility of CENVAT credit - As per
assessee's own case vide final order No. A/11356/2014, impugned orders are setaside and matters remanded to Commissioner (A) to decide the issue afresh: CESTAT
[Para 3, 6]
2015-TIOL-695-CESTAT -DEL
M/s Sundram Fasteners Ltd Vs CCE (Dated: January 20, 2015)
CX - M/s Sundram Fasteners sent imported bright bars directly to M/s Juneja Bright
Steels Pvt. Ltd. for conversion into bright wire rods on job work basis - M/s Juneja
Bright Steels Pvt. Ltd. had obtained ST registration treating their activity as BAS and
were paying ST on job charges and were also filing ST-3 return - Just because
subsequently Department takes the view that the activity of M/s Juneja Bright Steels
Pvt. Ltd amounts to manufacture and bright wire rods manufactured by them would
attract Central Excise duty, M/s Sundram Fasteners Ltd. cannot be accused of
receiving the wire rods with knowledge that the same were non-duty paid and liable
for confiscation - Imposition of penalty on M/s Sundram Fasteners Ltd. under Rule 26
(1) is not sustainable and as such they have strong prima facie case in their favour Stay granted: CESTAT [Para 6]
2015-TIOL-694-CESTAT -DEL
M/s Steelbird Hi Tech India Ltd Vs CCE (Dated: February 13, 2015)
CX - Appellant entitled to claim remission of duty in respect of finished goods
destroyed in fire - rule at the material time did not provide any condition regarding
reversal of credit taken in respect of inputs used in such goods - appeal allowed:
CESTAT [para 8, 9]
CX - Remission of duty on unfinished / semi- finished goods destroyed in fire - as
these goods are not marketable, remission of duty cannot be claimed - no cause for
reversing credit on input contained in unfinished goods / semi- finished goods lost in
fire as there is no provision for reversal of CENVAT Credit - appeal allowed: CESTAT
[para 10]
CX - There is also no provision in the Cenvat Credit Rules to reverse proportionately
CENVAT Credit on capital goods which was lost in fire or were not used - appeal
allowed: CESTAT [para 11]
2015-TIOL-690-CESTAT -AHM
M/s Thakkar Tobacco Products Pvt Ltd Vs CCE (Dated: February 6, 2015)
CX - Assessee operating under Pan Masala Packing Machines (Capacity Determination
and Collection of Duty) Rules 2008 and had been paying duty as per Rule 7 under said
Rules - In situations where after payment of duty by 5th for a particular month, if
factory remained closed for a period of 15 days or more, for the subsequent month,
they adjusted the amount of abatement under Rule 10 and paid the balance Revenue views that assessee should have paid the duty for subsequent month in full
and have claimed the abatement separately - Apart from Circulars dt.30.08.1997 and
15.09.1999, in a series of judicial pronouncements, a co nsistent approach has been
taken to effect that in case of such adjustment of duty which is mandatorily required
to be abated, Revenue cannot insist upon recovery of amount so adjusted - Appeal
allowed: CESTAT [Para 8, 9, 10]
2015-TIOL-684-CESTAT -MUM
M/s Mahindra & Mahindra Ltd Vs CCE & ST (Dated: March 25, 2015)
CX - Valuation - s.4 of CEA, 1944 - Rule 7 of Valuation Rules, 20 00 - price prevailing
at the depot from where the goods are finally sold shall apply - When the facts came
to the notice of the Department in January, 2001, subsequent to that it cannot be said
that there was suppression on the part of the appellant - Appeals partly allowed:
CESTAT [para 5, 5.1]
Also see analysis of the Order
2015-TIOL-683-CESTAT -DEL
M/s Swati Menthol And Allied Chem Vs CCE (Dated: December 31, 2014)
CX - Assessee is a manufacturer of DMO (De -Menthalised Oil) as Mentha Oil is
manufactured by farmer as agricultural product and exempted from payment of duty
as well as sales tax - For purchase of Mentha Oil, assessee is required to issue form
21 under UP State Sales Tax Provision to farmers - A truck carrying Mentha Oil was
detained which start from Sambhal to factory in Rampur and goods were seized Revenue has made the case only on basis of test report of Shriram Institute to say
that as goods are having 26% of Mentha Oil, therefore, are not Mentha Oil but of DMO
- DMO carries more than accumulated solo impurities which fact is ignored Statement of truck driver and Form 21 supports the case of assessee, as no
statement of farmers has been recorded - As the goods are not required to be seized,
same are not liable for confiscation - Order set aside and appeal allowed: CESTAT
[Para 2, 6]
2015-TIOL-682-CESTAT -DEL
M/s Tubewell Workshop And General Industries Vs CCE (Dated: January 13,
2015)
CX - Goods received by appellant in their factory as the goods have been
manufactured from inputs of same has been cleared on payment of duty - No
statement of supplie r of goods and transporter have been recorded to corroborate the
allegations against appellant - Appellant produced a certificate from supplier of goods
that they have supplied the goods and received payment through account payee
cheque - These facts have not been controverted by revenue at any stage - As the
goods have been received and duty has been paid there on - Appellant are entitled to
take Cenvat Credit: CESTAT
2015-TIOL-681-CESTAT -MAD
M/s Varica Herbs Vs CCE (Dated: February 6, 2015)
Central Excise - CENVAT credit - input services credit relating to testing and
certification charges, training, courier services, renting, security services, telephone
charges, transportation charges, AMC and printing and stationery denied in
adjudication; demands confirmed and agitated herein.
Held: Actual usage of services supported by substantial evidence on record
demonstrate relevancy of services to manufacture and business of the appellant - No
contrary evidence of use of services elsewhere; utilization for business as well as
manufacture - denial of CENVAT credit unjustified - However, expenditure on training,
printing and stationery could not satisfy as to relevancy thereof to the manufacture
activity; no CENVAT credit on these two items shall be allowed - credit on the rest of
the items clamed shall be allowed. [Para 4]
2015-TIOL-678-CESTAT -AHM
M/s Personna Cosmetics Vs CCE & ST (Dated: March 20, 2015)
CX - Shortage of finished goods - Demand of duty on shortage of finished goods was
confirmed on the basis of statement of Shri Hakim Thanawala - CE officers visited
appellant's premises on the basis of intelligence and thereafter how they accepted
Shri Hakim Thanawala as Director of Company when appellant firm is registered with
CE authorities as partnership firm - No material available on record to establish that
Shri Hakim Thanawala has any connection with appellant firm - It is the responsibility
of Revenue to identify the person while recording statement - No statement of any
employee of appellant firm was recorded - Demand of duty alongwith interest and
penalty on Appellant firm can not be sustained - Considering the fact that Shri Hakim
Thanawala is an employee of another unit, therefore, penalty is reduced to Rs.
25,000/-: CESTAT [Para 9, 10, 12]
2015-TIOL-676-CESTAT -MUM-LB
Mahindra & Mahindra Ltd Vs CCE (Dated: February 27, 2015)
CX - Classification of Commander Vehicles, whether under heading 87.02 or 87.03 of
the CETA, 1985 - In the absence of any expert opinion or advice from ARAI or VRDE,
Larger Bench handicapped in taking a final view - Matter remanded to adjudicating
authority: CESTAT LB[para 5.1 to 5.10, 6]
Also see analysis of the Order
2015-TIOL-674-CESTAT -MUM
Jsw Salav (Steel) Ltd Vs CCE (Dated: March 20, 2015)
CENVAT - Rule 2(l) of CCR, 2004 - If excise duty paid on Tugs & Barges are not
available as credit, it does not stand to reason that service tax paid on insuring these
goods should be available as credit under CCR 2004 - Insurance for assets utilised
within the factory is clearly admissible - It is not understood how Insurance done on
Contractors Plant and Machinery is an input service as it is the contractors who are
undertaking the job work for the appellant - For the contractor or the job worker it
may be an input service but not to the appellant who does not own these goods Matter remanded for ascertaining quantum of eligible credit: CESTAT [para 6.1, 6.2,
6.3, 7]
Also see analysis of the Order
2015-TIOL-671-CESTAT -DEL
CCE Vs Silver Grace Polypack (Dated: February 9, 2015)
CE - Restoration of appeal - From the letter dated 25.03.2014 of the Regis try to the
CPIO, CESTAT, New Delhi, which was sent to the respondent in response to their
application under RTI Act it is clear that there is no acknowledgement of the service of
the appeal available with the Registry and also there is no acknowledgement o f the
service of the notice fixing the date of hearing on 02.01.2014 - In view of this, there
is merit in the respondent's plea that they had neither received the copy of the
Revenue's appeal nor they had received the notice of hearing of the appeal on
2.1.2014 - Non-appearance of the respondent at the time of hearing of the matter on
2.1.2014 is justified - Final order dated 2.1.2014 is recalled and the appeal is restored
for fresh hearing: CESTAT [ para 7]
2015-TIOL-670-CESTAT -MAD
M/s Tamil Nadu Rolling Mills Ltd Vs CCE (Dated: January 30, 2015)
Central Excise - Compounded levy scheme - demands with interest and penalty
agitated herein.
Held: In view of divergent Court rulings, with Punjab & Haryana HC decision in favor
of appellant prior to the Chennai HC ruling, duty demand confirmed whereas interest
and penalty waived.
2015-TIOL-669-CESTAT -DEL
M/s Prem Products Vs CCE & ST (Dated: December 15, 2014)
Central Excise - Stay / dispensation of pre deposit - appellants are manufacturers of
Pan Masala and Gutkha; discharging duty liability under Pan Masala Packing Machine
(capacity determination and collection of duty) Rules, 2008 - during the month of
March 2010, May 2010, August 2010 and October 2010 they used the same machines
for the manufacture of the Pan Masala/ Gutkha Pouches of RSP 50 Paise as well as of
one Rupee - The department invoking the first proviso to PMPM Rules, 2008
demanded duty in respect these packing machines by treating each of these packing
machines as two operating packing machines; adjudicated duty demand along with
interest and penalty; agitated herein.
Held: Rule 8 becomes applicable when during a month, a manufacturer of Gutkha/
Pan Masala commences the manufacture of pouches of a "new RSP" on an existing
machine by which he was earlier manufacturing pouches of a different RSP - point of
dispute is as to what is the "new RSP" and whether a RSP different from the existing
RSP, but of the same RSP slab of the different RSP slabs mentioned in Rule 5, can be
treated as a "new RSP" - even if, for example, the machine during that month made
pouches of 25 paise, 50 paise and 75 paise per pouch, the deemed production under
Sec 3A read with Rule 8 would be 37,44,000/- pouches only - If first proviso to Rule 8
is invoked on such a case, it would result in charging duty on the same production
thrice which is not permissible as excise duty can be charged on the quantity of the
goods manufactured, whether on actual basis or on deemed basis - Rule 5 and first
Proviso to Rule 8 have to be read harmoniously; it cannot be given an interpretation
which result in levy of duty on the quantity which is more than the quantity of
Gutkha/ Pan Masala deemed to have been manufactured per month per machine as
per the provisions of Rules - new RSP referred in first proviso to Rule 8 would be the
RSP of a different slab, and not the RSP of the same slab - impugned order which
treats the RSP same slab i.e. Rs. 50 Paisa per pouch and Rs. 1 per pouch as different
RSPs is not correct as viewed in the rulings relied upon by the appellant - requirement
of pre-deposit of the duty demand interest there on and penalty is waived. [Para 6, 7,
8]
2015-TIOL-667-CESTAT -DEL
M/s Nidhi Metal Auto Components Pvt Ltd Vs CCE (Dated: January 27, 2015)
CX - CENVAT - it would be impractical to require the assessee to go behind the
records maintained by the first stage dealer – allegation has been made against the
appellant on the basis of statement given by the manufacturer, dealer/supplier of the
goods, but no investigation has been conducted at the end of the appellant - Appeal
allowed: CESTAT [para 7, 8]
Also see analysis of the Order
2015-TIOL-666-CESTAT -DEL
M/s Sunita Ispat Pvt Ltd Vs CCE (Dated: January 14, 2015)
Central Excise - Offence case - appellant firm engaged in the manufacture of MS
ingots from scarp; officers visited factory and detected stock shortages of finished
goods vis -à-vis records; katcha chits with particulars of scrap purchases seized from
residential premises of individuals, who are partners in the firm; on the basis of
investigation, suppressed production, clandestine clearances was alleged; demands
confirmed with interest and penalty; agitated herein.
Held: Demands on two primary counts (1) excess electricity consumption coupled with
katcha slips inter alia, suppressed production and clandestine clearances of the same;
and (2) clandestine clearance of stock short-detected - In respect of (1), charge
against the appellant has been dropped o n the ground that demand based on report
of Dr. N K Batra, Prof. IIT Kanpur is not acceptable as held by Apex Court in the case
of R A Casting - charge of clandestine manufacture and removal already held by
Commissioner as not sustainable; therefore, duty demand is also not sustainable show cause notice although discussed that certain katcha slips were found during
investigation for purchase of scrap on the basis of these slips, no demand of duty is
proposed on that basis - as there is no duty demand in the show cause notice
corresponding duty demand unsustainable and set aside; consequently the demand of
interest and imposition of penalty on this count is also set aside. [Para 6, 7]
During the course of investigation finished goods were found short and the appellant
has paid the duty thereon; but the charges of clandestine removed have been
dropped - it cannot be held that goods have been cleared clandestinely - Although the
appellants has paid the duty that might be to settle the issue at that stage, but from
the records it is not coming out that the charge of clandestine removal has been
proved with any supportive evidence except the goods were found short during the
course of investigation - appellant is not contesting the duty demand hence cannot
claim refund as a consequence - when the appellant has paid the duty but there is no
demand of interest proposed, charge of clandestine removal stands unapproved and
hence question of imposing penalty does not arise - impugned order qua demand of
duty along with interest and imposition of penalty on the main appellant and penalties
co-appellant is set aside. [Para 8]
2015-TIOL-665-CESTAT -DEL
M/s The Malt Company India Pvt Ltd Vs CCE (Dated: January 13, 2015)
CENVAT - Credit taken on the strength of GAR-7 indicating the amount of ST paid on
GTA service under reverse charge - the only mistake in the GAR challan is that the
name of the appellant and address is correctly mentioned but the Registration number
of their Khandsa road unit has been wrongly entered in the challan - credit cannot be
denied for this mistake: CESTAT [ para 6]
CENVAT - Invoices on the basis of which credit had been availed bear the address of
Khandsa Road unit - subsequently the service providers had made corrections in these
invoices - it is not the department's allegation that on the basis of these invoices, both
the Khandsa and Patudi unit have taken credit simultaneously - the Khandsa unit has
also given an undertaking in this regard - denial of credit is not sustainable - Order
set aside and appeal allowed with consequential relief: CESTAT [ para 7, 8]
2015-TIOL-660-CESTAT -DEL
CCE & ST Vs Gardex (Dated: February 11, 2015)
CENVAT - Rule 5, 6 of CCR, 2004 - Common inputs - Respondent manufacturing Hand
tools which had been cleared on payment of duty and Garden tools wh ich are fully
exempt from duty under notification no. 5/-2006-CE dated 1.3.2006 and these garden
tools have been exported out of India under letter of undertaking without payment of
duty - Department seeking action under rule 6 of CCR, 2004 - Commissioner( A)
allowing respondents appeal - Revenue in appeal before CESTAT. Held: For an earlier
period on identical issue in respect of same respondent, it is held that respondent
have correctly availed the CENVAT credit in respect of the inputs for garden tools
which were exported out of India and have correctly utilized the credit for payment of
duty on the other dutiable final products which were exported out of India under
rebate claim - Rule 5 of CCR, 2004 nowhere states that the same would not be
applicable when the final products exported under bond or under letter of undertaking
are the goods fully exempted from duty - Bombay High Court decision in Repro India
2007-TIOL-795-HC -MUM-CX relied upon - Revenue appeal dismissed: CESTAT [para
2, 3]
2015-TIOL-657-CESTAT -MAD
M/s Tansi Foundry Vs CCE (Dated: September 16, 2014)
Central Excise – SSI exemption – Appellant claimed benefit under Notification No.
1/93-CE dated 28.02.1993 for clearances of CI Tubes and Pipes; while they paid full
duty on unmachined CI articles an d ferrous waste/scrap – Revenue viewed benefit
inadmissible since the appellants had not opted SSI exemption in respect of the goods
under Sub -heading No. 7325.10, they are not eligible to avail the SSI exemption in
the other products – demands adjudicated, upheld by Commissioner (Appeals), and
agitated herein.
Held: No dispute that after amendment of the SSI exemption Notification No. 1/93 by
Notification No. 59/94, the simultaneous availment of modvat and SSI exemption by
the manufacturer on different goods is not permissible – no merit in the appeal; no
reason to interfere with the impugned order. [Para 2]
2015-TIOL-656-CESTAT -DEL
M/s Dalmia Bharat Sugar And Industries Ltd Vs CCE & ST (Dated: January 20,
2015)
Central Excise - Stay / dispensation of pre deposit - CENVAT credit - appellant
engaged in the manufacture of sugar, molasses, denatured spirit, also produces
bagasse, pre ss mud and electricity which are non dutiable - Revenue viewed that
input services credit availed on security agency service, goods transport agency
service for transportation of the inputs up to the factory premises, manpower
recruitment or supply service, internet telecom services, courier service, business
auxiliary service (commission agents service) etc. used commonly for both excisable
and exempted goods and that an ‘amount' under Rule 6 (3) (ii) of CCR 2004 merited
reversal; that exemption under notification No.67/95-CE was unavailable for molasses
cleared for manufacture of Extra Neutral Alcohol and also that credit on molasses
procured from outside was not available on the quantum deployed in manufacture of
exempted goods - demands confirmed with interest and penalty; agitated herein.
Held: appellant's plea in respect of input services credit is that they have already
complied with the requirement of Rule 6 (3) (ii) read with Rule 6 (3A) of the Cenvat
Credit Rules; the same would be examined during main appeal hearing - Duty
exemption under Notification No. 67/95-CE is available only to the goods falling under
the first Schedule to the Central Excise Tariff Act - When the "un-denatured ethyl
alcohol of any strength" does not figure in the first Schedule to the Central Excise
Tariff Act, 1985, the excisable goods produced in a factory and used within that
factory for production of un-denatured ethyl alcohol would not be eligible for this
exemption - duty exemption in respect of molasses manufactured in the appellant's
factory and captively cleared to the distillery unit would not be admissible, to the
extent the molasses was used in the manufactured of un-denatured ethyl alcohol and
prima facie corresponding duty demand appears to be on a strong footing - appellant
directed to deposit an amount of Rs. 5,00,00,000/ - (Rupees Five crore) for
compliance with the provision of Section 35F within a period of eight weeks. [Para 6.1,
7, 8]
2015-TIOL-654-CESTAT -MUM
M/s Sridhar Metal Vs CCE, C & ST (Dated: March 05, 2015)
CX - s.35F of CEA, 1944 - In the appeal procedure in Tribunal the stage of
entertaining the appeal is right from the date of filing of the appeal, therefore, at the
time of filing of the appeal, the appellant is required to make deposit of 7.5% or 10%
of duty - Pre -deposit ordered: CESTAT [para 5, 5.1]
Also see analysis of the Order
2015-TIOL-649-CESTAT -DEL
Cabana Estates Pvt Ltd Vs CCE & ST (Dated: December 30, 2014)
CX - Common input services used in or in relation to providing of taxable and
exempted service - Assessee had not maintained separate accounts and inventory of
input services meant for taxable and exempted service - As per amended Rule 6(3) of
CCR, 2004, they have already revered the cenvat credit along with interest
attributable to input services used in or in relation to providing exempted service Matter, though pertaining to cenvat credit, is in respect of an output service provider
and assessee is not a manufacturer, this appeal should have been numbered as ST
Appeal and listed accordingly - Stay granted: CESTAT
2015-TIOL-647-CESTAT -AHM
M/s Mafatlal Industries Ltd Vs CCE (Dated: December 19, 2014)
Central Excise - CENVAT credit - appellants are engaged in the manufacture of Cotton
Yarn, Non Cellulosic Spurn Yarn, Processed Man Made Fabrics, 100% Cotton Fabrics,
and Mixed Cotton Fabrics; received duty paid Yarn under Basic Excise duty and
Additional Excise Duty (Textile and Textile Articles) and availed CENVAT Credit Revenue viewed that as per Rule 3(6)(b) of CENVAT Credit Rules, 2002, the appellant
is not eligible to utilize the AED (T&TA) for payment of Basic Excise Duty - Impugned
credit disallowed in adjudication; demand for recovery along with interest confirm ed,
penalties imposed under Rule 13 of CENVAT Credit Rules, 2002 read with Section
11AC of Central Excise Act 1944; upheld by Commissioner (Appeals) and agitated
herein.
Held: On plain reading of Rule 3(6)(b) of CCR, it is clear that the CENVAT Credit in
respect of AED (T&TA) shall be utilized only towards payment of duty of Excise
leviable under AED(T&TA) Act - With effect from 09.07.2004, AED(T&TA) was
exempted in respect of clearance of the final product hence the appellant cannot
utilize credit of AED(T&TA) in respect of payment of basic duty for clearance of final
product - Board's circular dt.16.04.2003 was issued in respect of utilization of CENVAT
Credit of Basic Excise Duty towards payment of Additional Duties of Excise (GSI) Act,
1957; whereas in the present case, the appellant utilized the AED (T&TA) for payment
of Basic Excise Duty - CENVAT Credit Rules, 2002 has clearly imposed restriction of
utilization of AED(T&TA) in respect of other duties - appellant cannot utilize credit of
AED (T&TA) for payment of Basic Excise Duty, in terms of the Raymond Limited ruling
- appellant also contended that the accumulated credit of AED (T&TA) would be
eligible for refund - Tribunal in the case of Century Rayon Ltd held that even if held to
be entitled to take credit of such duty paid in excess by them, would not be able to
utilize the credit, the assessee is entitled to cash refund; if appellant cannot be
allowed to utilize AED(T&TA), they can take a refund, if permitted under the law - no
allegation of suppression of facts with intent to evade payment of duty; dispute a case
of interpretation of provisions of law; no material available on records to invoke the
ingredients as mentioned in Section 11AC of the Central Excise Act 1944 - imposition
of penalty under Section 11AC unwarranted; impugned order modified to the effect
that demand of duty along with interest are upheld while Penalty is set aside. [Para 6,
7, 8, 9]
2015-TIOL-640-CESTAT -DEL
Dry Tech Processors (I) Pvt Ltd Vs CCE (Dated: December 24, 2014)
CE - Notfn 3/2007 -CE - Classification - Whether goods i.e. "Fresubin" manufactured
by appellant merit classification as 'instant food mix', as claimed by assessee for
purpose of duty exemption under said Notification or under category of 'food
supplement' as asserted by Revenue - Affixation of additional information in pouches
regarding its possible use for hospitalized patients cannot change the basic
characteristic of "Instant Food Mix" being a statutory requirement under food laws No conceivable substantiation has been brought on record to negate the stand of
assessee, which is duly endorsed by expert on concerned field vide certificate dated
16.05.2007 - Competency of said institute in furnishing the certificate cannot be
questioned by revenue, especially in absence of a contrary certificate being obtained
from a recognized agency of repute - Appeal allowed: CESTAT [Para 10, 13]
2015-TIOL-636-CESTAT -MUM
Mirc Electronics Vs CCE (Dated: January 20, 2015)
CX - Appellants availing CENVAT Credit of CVD/CE duty and SAD paid by them when
they import the parts, components and accessories for manufacturing of Colour T.V. Appellant had not reversed SAD at the time of removal of parts, components and
accessories, but subsequently discharged duty liability along with interest - SCN
invokes provisions of Rule 14 of CCR, 2004 r/w s. 11A for demanding the amount
which is equivalent to an amount of SAD on parts and components cleared to co makers - Non-reversal of SAD cannot be with intention to evade duty on such
components, as the appellant had discharged appropriate duty liability of CVD/CE Since there is revenue neutral situation, there cannot be any intention to evade duty Order set aside and appeal allowed: CESTAT [Para 8, 9, 9.1, 9.2, 10]
2015-TIOL-630-CESTAT -DEL
M/s Dhampur Sugar Mills Ltd Vs CCE (Dated: January 28, 2015)
CX - MODVAT credit - As regards denial of Modvat Credit in respect of Steel Items for
period January 1997 to March 1997, since during this period definition of capital
goods, as it existed during period prior to 23.07.1996 has been substituted by a new
definition which covered the goods of certain specified chapter headings and as such
for this period iron and steel items would be eligible for credit as inputs only if the
same had been used for manufacture of capital goods or their parts and would not be
eligible for credit if the same had been used as foundation or supporting structure for
machinery - Matter is remanded to Original Adjudicating Authority for de novo
decision after hearing appellant regarding the use of steel items: CESTAT
CX - CENVAT credit - As regards denial of credit in respect of nickel screen and gunny
bags, the credit denied only on ground that the same are not covered by the
declaration - It is seen that this ground for denial is not factually correct as both the
items are covered by declarations filed by appellant - denial of credit is set aside:
CESTAT
2015-TIOL-623-CESTAT -BANG
CCE, C & ST Vs Shri Doodhganga Krishna Sahakari Sakkare Karkhane Niyamit
(Dated: November 7, 2014)
Central Excise - Stay sought by Revenue against dropping of demand of interest Grant of stay would result in reviving non-executable original order - Stay hence
rejected.
2015-TIOL-621-CESTAT -BANG
Aabha Mouldings Vs CC,CE & ST (Dated: May 21, 2014)
Central Excise - SSI Exemption - Denial - Sustainability - Manufacturing of plastic
bottles bearing brand name - Notification No. 10/2013 - C.E. (N.T.) dated 02.08.2013
provided retrospective exemption for clearances of plastic containers and plastic
bottles meant for use as packing material by the person whose brand name such
goods bear for the clearances from 16.06.2003 to 26.02.2010 - Period disputed is
covered by said Notification - Entitled to duty exemption - In assessee's own case on
identical facts , appeal was allowed - Appeal thus allowed with consequential reliefs.
(Para 5)
2015-TIOL-620-CESTAT -KOL
M/s Jai Balaji Industries Vs CCE & ST (Dated: January 21, 2015)
CX - Assesssee engaged in manufacture of TMT Bars/Rods captively used in
fabrication of plant and machinery in their factory premises - Exemption under Notfn.
67/95 -CE was availed - Chartered Engineer's Certificate produced by assessee before
Adjudicating Authority is vague and definitely difficult to verify the use of such TMT
Bars/Rods in respective plant, machinery and structural - Assessee had placed
another Chartered Engineer's Certificate dated 17.06.2010, furnishing the use of such
TMT Bars/Rods in respective plant and machinery - Since this Certificate was earlier
not placed before Adjudicating Authority, hence, same could not be verified by
Department - In interest of justice, therefore, contents of Certificate and claim of
assessee, needs to be verified vis -a-vis allegations in Demand Notice - Thus, matter
remanded to Commissioner for necessary verification of said Certificate - Assessee is
directed to deposit Rs.5.00 lakh: CESTAT [Para 2, 5]
2015-TIOL-617-CESTAT -BANG
M/s Agro Tech Foods Ltd Vs CCE (Dated: November 25, 2014)
Central Excise - Edible preparations -Classification -Appellant engaged in importing of
peanut butter and undertakes re-labeling of the product with label of its own brand
name - Denied Cenvat credit of duty paid on ground that final product is exempted
under Sl. No. 11 of Notification No. 3/2006-CE - Whether 'Peanut butter' a nd
'Margarine' are two distinct products and not interchangeable or similar to each other
-Held, issue is complicated and involves different interpretations as such requires
consideration of HSN Explanatory Notes, Tariff Heading, End use, Chemical properties,
etc - In view of the fact that large part of the credit has already been reversed
appellant directed to deposit Rs.10 lakhs to hear the appeal - Pre -deposit of balance
dues is waived. (Para 4)
2015-TIOL-616-CESTAT -BANG
CC, CE & ST Vs M/s Balaji Industries (Dated: December 2, 2014)
Excise – Appeal by Revenue – Maintainability – Duty amount involved is less than Rs.
5 lakhs – Appeal rejected following established precedents notwithstanding appeal in
question was filed prior to issue of Board Circular prescribing mandatory limit for filing
appeal.
2015-TIOL-615-CESTAT -MAD
CCE Vs Vyas Textiles (Dated: December 2, 2014)
Central Excise – Offence case - respondents M/s. Vyas Textiles were engaged in the
manufacture of cotton yarn; officials visited the premises and found another unit, M/s
Vyas Textiles ‘B' Unit in the same premises – On investigation, Revenue viewed that
the value of clearances of the two units merited being clubbed and SSI exemption to
be denied – demands proposed on the cotton yarn in Cheese form cleared in the guise
of Plain Reel Hank (PRH) dropped in adjudication on merits as well as limitation, and
agitated by Revenue herein.
Held: department's allegation that the proprietor has deliberately obtained two
registrations by changing the initials of G.M. Vyas and M.G. Vyas appears to be
factually incorrect; department has not adduced any evidence to prove that M.G. Vyas
is not the son of G.M. Vyas and both relates to same individual - no merit in the
Revenue's allegation that proprietor has obtained registration by falsely declaring the
name by changing the initials. [Para 10, 11]
Both the units have obtained central excise registration certificates much prior to the
SSI exemption extended to cotton yarn vide Notification No. 90/94 dt. 25.4.94 – Both
Units submitted record requesting for allowing SSI exemption up to the limit of Rs. 30
lakhs as per Notification No. 1/93 dt. 1.3.93 as amended by Notification No. 90/94 dt.
25.4.94 - evident that returns were duly scrutinized and assessed by the proper
officer and accepted; that the description, quantity manufactured and quantity cleared
and duty paid undisputed - adjudicating authority has rightly held that there is no
suppression of facts; the respondents are eligible for SSI exemption of Rs.30 lakhs fo r
both the units in the year 1994-95; adjudicating authority has rightly dropped the
proceedings both on merits and on limitation. [Para 12]
On the issue of mis declaration of cheese yarn in the guise of PRH, the entire demand
was made on the basis of sta tements recorded from seven customers, transporters
and few workers of the respondent factory - burden of proof is entirely on the
department to establish that there was clearance of cheese yarn either from the
respondents premises - department has to establish mis declaration and evasion of
duty, there should be statutory proof beyond doubt other than the statements;
department has to establish through corroborative documentary evidence and not
merely relying on a general statement from the customers – onus not discharged.
[Para 13, 14, 15]
Patna HC ruling in CCE Vs Brims Products squarely applicable to the facts of the
instant case - adjudicating authority has discussed the issues at length and has given
a detailed order while dropping the demand proposed in SCN - no infirmity in the
impugned order passed by the adjudicating authority; same upheld. [Para 16]
2015-TIOL-608-CESTAT -MAD
CCE Vs M/s B K Office Needs Pvt Ltd (Dated: December 2, 2014)
Central Excise - Clubbing of clearances - respondents are suppliers of Modular Office
partitions, work stations and furniture; they also supply tables, chairs, computer
tables etc., which are bought out items - Officers visited the premises and detected
two other firms located thereat - Revenue viewed that they were interconnected
units; and that their clearances were to be clubbed for assessment to CE duty - duty
demands adjudicated with interest and penalties on the firms and the individual;
goods held classifiable as "Systems Furniture and Work Stations" under chapter
heading 9403.00; demands set aside by Commissioner (Appeals) and agitated by
Revenue herein.
Held: Two issues involved, viz, Clubbing of clearances and classification of impugned
goods - M/s. Tab Top and Fab Craft, manufactured general furniture such as tables,
chairs, computer tables, cupboards, filing cabinets and parts of modular work stations
and sold to M/s. B.K. Office - Shri S. Ramanathan procured the orders from buyers
and placed to the other two firms for manufacturing of goods - M/s. B.K. Office, in
their brochure claimed the goods were manufactured by them - M/s. Tab Top and Fab
Craft are separate entities and constitution of partnership/proprietorship, sales tax
registration etc. are in existence, should serve as an independent business entity investigation had not proved any non -receipt of raw materials and manufacture of
components thereon from these two units; no evidence of financial flowback - well
settled that mere common partners and proprietor of other concern, and use of staff
etc., would not suffice to hold that units are one and the same - no reason for
clubbing of the three units. [Para 10]
On identical issue, Revenue initiated proceedings in other Commissionerates, which
were dropped by the respective Commissioner (A) on the ground that impugned
goods called as modular system furniture or workstations cannot be classified as a
collective item as 'other furniture or parts', under CH 9403 of CETA, 1985 - no
material that the order of the Tribunal was challenged before the higher Appellate
Authority - In the present appeals also, Revenue took the same grounds as in other
cases - findings of the Commissioner (Appeals) on both the issues upheld. [Para 14]
2015-TIOL-604-CESTAT -MAD
M/s Surya Fine Chemicals Vs CCE (Dated: January 8, 2015)
Central Excise – Dutiability / Classification – Appellant firms engaged in manufacture
of food color preparations both as manufacturer and job worker - appellant was under
bona fide belief that its activities shall not amount to manufacture and not liable to
duty and no registration under Central Excise Act, 1944 is warranted even after
insertion of Chapter Note 7 in Chapter 21 of the Schedule to the CETA 1985 – Goods
sought to be classified by Revenue under Chapter 32, agitated herein.
Held: When the bonafide of appellant is patent from records in view of the confusion
persisting in the industry it would not be proper to hold the adjudication made is
within the limitation period; Apex Court rulings in Anand Nishikawa case and Uniworth
Textiles case applica ble - Where there are specific and explicit averments challenging
fides and conducts of assessee brought out in the show-cause notice, the notice is
said to have brought such fides to the knowledge of the assessee for defence - In
absence of malafide expre ssly stated in the show-cause notice, it cannot be presumed
that appellant had acted malafide – Apex Court consistently held that when facts are
within the knowledge of both sides there cannot be presumption that there was
suppression of fact. [Para 7, 9, 10]
In view of the finding that there was no malafide in the show-cause notice and
confusion of classification persisted in the industry having led the appellant to be in
confusion, the adjudication can be said to be time-barred; for the same reasons no
penalty on this appellant sustainable. [Para 11, 12]
2015-TIOL-603-CESTAT -AHM
Bilag Industries Pvt Ltd Vs CCE (Dated: January 6, 2015)
Central Excise - CENVAT credit - appellants are engaged in manufacture of Technical
Grade Pesticides; used Furnace oil for generating electricity, which was used captively
as well as to other units in the same premises - Revenue viewed the credit
inadmissible on the Furnace oil used in generation of electricity cleared to other units
during the material period; confirmed demand for recovery of CENVAT Credit along
with interest and imposed penalties on the firm and individual under Rule 26 of
Central Excise Rules 2002 - demands upheld by Commissioner (Appeals) and agitated
herein.
Held: On the identical issue, a show cause notice dt.12.08.2005 was issued proposing
denial of CENVAT Credit for the earlier period, set aside by the Division Bench of the
Tribunal vide Final Order No.A/877-882/WZB/AHD/ 2012, dt.04.06.2012 on the
ground of limitation - present show cause notice dt.10.09.2007 was issued for the
subsequent period - when the demand of duty against the earlier show cause notice
was set aside as time barred, the demand of duty for the extended period of
limitation, on the same facts in the present show cause notice cannot be sustained findings of the Tribunal in the appellant's own case for the earlier period would be
squarely applicable in the present case; part of demand along with interest and
penalty barred by limitation set aside - demands for normal period upheld - penalty
on individual set aside. [Para 4, 5]
2015-TIOL-600-CESTAT -MAD
Mathur Corr-Tech Pvt Ltd Vs CCE (Dated: January 8, 2015)
Central Excise - Valuation - Goods were assessed under Sec 4A and cleared but
Revenue viewed that Sec 4 is applicable; adjudicated demands; agitated herein Assessee contends there was no suppression.
Held: Board's circular dated 28.02.2002 has ground that there was persisting
confusion in industry which has prevented the appellant assess the goods under
Section 4A of Central Excise Act, 1944 - No malafides alleged in SCN; Apex Court
ruling in Jaiprakash Industries applicable; appellant's bonafide intentions brought to
public record - Appeal allowed. [Para 6, 7]
2015-TIOL-599-CESTAT -DEL
Dewas Metal Section Ltd Vs CCE (Dated: January 1, 2015)
CE - Assessee manufactured certain automobile parts for M/s. Bajaj Tempo Ltd. in
terms of supply agreement with them at a specified price - Assessee purchased their
two years requirement of raw-material at one time and since this involved extra
carrying cost of raw-material inventory, said cost was recovered from M/s.Bajaj
Tempo Ltd as interest on raw-material inventory under debit notes - As per Bombay
Tyre International 2002-TIOL-374-SC -CX-LB, the amount charged from customers as
carrying cost of extra raw material inventory would be includible in AV - Since the fact
of recovery of extra inventory cost from M/s Bajaj Auto under debit notes had not
been disclosed in ER -I returns, it has to be inferred that short payment was on
account of suppression of fact on the part of assessee - Hence, longer limitation
period has been correctly invoked and penalty under section 11AC of CEA, 1944 has
been correctly imposed: CESTAT [Para 5, 6, 7]
2015-TIOL-598-CESTAT -DEL
M/s Dashmesh Castings Pvt Ltd Vs CCE & ST (Dated: February 3, 2015)
CX - Raw material purchased by appellant was defective CTD rounds / bars which
acted as a waste material for appellant, to be melted in their furnace - Entire case of
Revenue is based upon financial calculation of profit and loss of manufacturing unit Inasmuch as no retailer can survive if more than 80% of its final product were held to
be defective/ rejected / scrap - Appellant have shown receipt and utilization of raw
material in their factory and have taken the benefit of Cenvat credit based upon
cenva table invoices issued by registered dealer - Appellants need the raw material for
the production of their final product and if, as per the Revenue, such material has not
been received by them from M/s. ASRM, they were not in a position to manufacture
the f inal product - Revenue has not shown any alternative source of such procurement
of raw material - No reason to uphold impugned orders and same are set aside Appeal allowed: CESTAT
2015-TIOL-597-CESTAT -MAD
M/s Caress Beauty Care Products Pvt Ltd Vs CCE (Dated: December 24, 2014)
Central Excise - CENVAT credit - appellant, a manufacturer of shampoo and cold
cream availed input services credit under Rule 2(l) of CCR 2004 on ‘Gardening and
House Keeping Services', viewed as inadmissible by Revenue; demands adjudicated;
partly modified by Commissioner (Appeals) and agitated herein.
Held: Under the Pollution Control License Order and Schedule-M of the Drug Control
Act, it is mandatory for the appellant to maintain green cover and also use the
effluent treated water and keep the factory premises clean - Therefore, as per the
statutory requirement, the appellant is required to maintain gardening and green
cover and plants and cleanliness of the manufacturing premises - Tribunal ruling in
the Murugappa Morgan Thermal Ceramics case applicable; Tyco Sanmar and Xomax
Sanmar not applicable to the facts of the present case - appellant is eligible for credit
on gardening and house-keeping services. [Para 5]
2015-TIOL-590-CESTAT -BANG
M/s Facor Alloys Ltd Vs CCE (Dated: November 25, 2014)
Central Excise - Cenvat - Eligibility - Cenvat credit on molasses diverted after
clearance for export - Merchant exporter diverted molasses only upon obtaining
required permission, paying tax under Challan - Further, issued invoice and Challan to
appellant - Denial of credit for want of legally recognized documents - Challan is one
of the documents listed - Prima-facie case made out on limitation though not on
merits as notice was issued in 2011 for the credit taken in 2007 - Pre -deposit waived.
(Para 2)
2015-TIOL-589-CESTAT -MAD
Cauvery Stones Impex Pvt Ltd Vs CCE (Dated: December 29, 2014)
Central Excise - Refund of unitized credit - appellants exported polished granites and
claimed refund under Rule 5 of CCR 2004; portion related to outward transportation
up to port disallowed in adjudication on the ground that the service was rendered
beyo nd factory premises; upheld by Commissioner (Appeals) and agitated herein.
Held: Invoice and Shipping Bills clearly show that terms of delivery is on FOB basis
and the place of removal is upto the port of loading - Tribunal, in their own case for
the subsequent period, allowed their appeal - Since the export documents in the
instant case clearly show that terms of delivery on payment is upto port on FOB basis,
following the ratio of the Tribunal decision in their own case, the impugned order is
set aside. [Para 5]
2015-TIOL-588-CESTAT -MAD
M/s Chemplast Sanmar Ltd Vs CCE (Dated: October 24, 2014)
Central Excise - Excisability of waste weak HCl acid - appellants are engaged in the
manufacture of PVC Resin and Hydrochloric Acid; during the process of which,
Hydrogen Chloride gas emerges, is dissolved in water and cleared as HCl on payment
of duty - complex hydrocarbon waste is also generated which is incinerated and
cleared as "Waste Weak HCl Acid" viewed as dutiable by Revenue under Heading
2806.10 - demands confirmed and agitated herein.
Held: Supreme Court consistently viewed that merely because the goods are sold in
the market, it would not make them marketable - Apex Court rulings in the TISCO
case and Gujarat Narmada Valley Fertilizers case; Gujarat HC ruling in the Dhakad
Metals case applicable - Larger bench ruling in the Keti Chemicals case relied upon by
Revenue distinguished - no material available to show that waste weak HCL acid is
marketable and therefore it cannot be treated as an excisable commodity - the
impugned orders are set aside. (para 5)
2015-TIOL-587-CESTAT -MAD
Dalmia Cements (Bharat) Ltd Vs CCE (Dated: September 16, 2014)
Central Excise – CENVAT credit - appellants engaged in the manufacture of cement
and clinkers, availed cenvat credit on cement, steel etc. used for constructing "Silos"
to be used for storage of cement and various raw material during the period from
September 2004 to March 2005 – Revenue held the same inadmissible, adjudicated
demands with interest and penalty, agitated herein.
Held: Decision of the Bombay High Court in the case of Bharti Airtel relied upon by
Revenue found inapplicable to the facts and circumstances of the instant case decision of Karnataka High Court in the case of SLR Steels Ltd is directly on the
present issue in favour of the assessee - impugned order set aside. [Para 5, 6]
2015-TIOL-586-CESTAT -MAD
M/s Jubiliant Engineering Ltd Vs CCE (Dated: January 12, 2015)
Central Excise - Rebate / Refund - appellant, a 100% EOU engaged in the
manufacture of valve assemblies, exported goods on payment of duty from CENVAT
credit and then filed rebate claim - before the claim could be adjudicated, they sought
cancellation and availed suo moto credit of cenvat credit and no duty was payable on
exports - Revenue viewed the same irregular; adjudicated recovery with interest and
penalty, upheld by Commissioner (Appeals); and agitated herein.
Held: Division Bench in their own case already decided the issue in favour of the
appellants vide final order 1280 - 1284/2008 dated 16.07.2008 - By following the
same, once the appellants rebate claim is cancelled they are entitled to take re -credit
in their cenvat account. [Para 5]
2015-TIOL-584-CESTAT -BANG
M/s Goodrich Aerospace Services Pvt Ltd Vs CCE (Dated: November 21,
2014)
Central Excise - Credit distribution - Credit cannot be denied because both EOU and
STPI are located within the same premises necessitating to take input distributor
registration and distribute credit - Impugned order to that extent set aside - As
regards nexus between the units in question, matter is remanded to original authority
to decide in view of interim order and binding precedents on the issue. (Para 2)
2015-TIOL-576-CESTAT -KOL
M/s AI Champdany Industries Ltd Vs CCE (Dated: January 5, 2015)
CX - Pre-deposit - s.35F of CEA , 1944/s. 129E of CA, 1962 - It is a cardinal principle
of statutory interpretation that while incorporating a statute or a provision into the
existing statute, the Legislatures are fully aware of the position of law as was
prevailing on the date of new legislation or bringing the change into the exis ting
legislation - law i.e. amended Sec.35F of CEA /1944 is very clear and unambiguous
and the intention of the legislature is also loudly made clear about its applicability Needless to emphasize, the Tribunal is a creature of the statute and accordingly
bound by the statute - Pre -deposit mandatory even in respect of orders passed prior
to 06.08.2014 and appeals filed thereafter: CESTAT [ para 6]
Also see analysis of the Order
2015-TIOL-573-CESTAT -DEL
M/s Insecticides (India) Ltd Vs CCE (Dated: December 11, 2014)
CE - Valuation - s.4 of CEA , 1944-Denial of the deduction of trade discount and
turnover discount which had been passed on to the customers through credit notes discounts were known prior to the clearance of the goods is not in disputeCommissioner has allowed the deduction of these discounts wherever these discounts
had been passed on to the customers in the invoices, however, same have been
disallowed only in those cases where the discounts were not mentioned on in the
invoices, but were passed on by the way of credit notes - Commissioner has also
given a finding that the genuineness of the credit notes through which they have
given the sales discounts has been established-Only ground on which the deductions
of these discounts has been disallowed is that the a ppellant had not intimated to the
Department about the discount which they intended to passed on through credit
notes, after the sales through depot and they have not resorted provisional
assessment-Grounds on which the deduction of the discounts passed on through
credit notes has been disallowed are totally wrong - Demand is not sustainable, hence
set aside: CESTAT [ para 6]
CE-Short payment of duty of Rs . 1,891/-and wrong availment of Cenvat credit of Rs .
4,41,633/--these demand amounts are not dispute d and appellant has paid the same
before issuance of demand notice - there is no finding in the order that the wrong
availment of credit or short payment was deliberate or on account of fraud, willful
misstatement etc. on the part of the appellant - in such a circumstance imposition of
mandatory penalty u/s 11AC of CEA , 1944 is not sustainable, however demand
sustained: CESTAT
2015-TIOL-572-CESTAT -DEL
M/s Redicura Pharmaceuticals Pvt Ltd Vs CCE (Dated: February 4, 2015)
CE - SSI exemption - Notification 9/2003-CE - Goods got manufactured by the
appellant as a Loan Licensee through other manufacturers & goods manufactured by
appellant for Loan Licen sees as a job worker is not to be included while computing the
aggregate value of clearances for determining exemption limit - Appeal allowed:
CESTAT [ para 4, 5]
Also see analysis of the Order
2015-TIOL-571-CESTAT -DEL
M/s Pawan Alloys And Casting Pvt Ltd Vs CCE & ST (Dated: January 2, 2015)
Central Excise - Clandestine clearances - officers visited the appellant's premises,
detected shortage of MS Ingots on comparing physical stocks vis -à-vis record demands confirmed with interest and peanlty, upheld by Commissioner (Ap peals) and
agitated herein.
Held: Average basis counting of the MS Ingots was done to arrive at the shortage;
apart from that, no other corroborative evidence has been ascertained in this matter
to allege the clandestine removal of the goods - Although the authorized
representative of the appellant has admitted the shortage, he has not admitted that
any goods have been removed from the factory without payment of duty - Tribunal
ruling in the case of J C Rolling Mills and High Court ruling in the case of Bajrang Petro
Chemicals distinguished on facts - Ruling pronounced in the case of Durga Steel
Rolling Mills applicable to instant case; appellant is not liable to pay duty on the
shortage of finished goods - in respect of discount offered by supplier of defective
inputs, no reversal of credit required as clarified in Board Circular dated 17.11.2008.
[Para 7, 9]
2015-TIOL-567-CESTAT -MAD
M/s Madura Steel Industries Pvt Ltd Vs CCE (Dated: January 12, 2015)
Central Excise - CENVAT credit - Obligation under Rule 6 of the Cenvat Credit Rules,
2004 - appellants manufactured 'Steel Castings' and supplied to M/s. Heavy Vehicles
Factory, for use in the manufacture of 'Battle tanks'; claimed exemption under sl. No.
88 of Notification No. 4/2006-CE dated 01.03.2006 - Revenue viewed appellant liable
to reverse 10% 'amount' of value of exempted goods under Rule 6; adjudicated
demands; upheld by Commissioner (Appeals); and agitated herein.
Held : As per the amended Rule 6 of CCR w.e.f. 01.04.2008, the appellants are
required to pay proportionate credit as per sub-rule 3(A) of Rule 6 of CCR, 2004 appellants have reversed proportionate credit on the inputs used in the manufacture
of castings supplied to M/s. HVF and the same was appropriated in the Order-inOriginal - Though the adjudicating authority in his order stated that it is covered
under the provisions of sub-rule 3(A) of Rule 6 of CCR, he confirmed the demand of
10% on the value of goods cleared instead of following the formula prescribed - the
adjudicating authority has not followed the provisions of sub -rule 3(A) of Rule (6),
therefore, the impugned order is set aside and the appeal is remanded back to the
adjudicating authority to re-determine the reversal of credit amount as per the
provisions of sub-rule 3 (A) of Rule (6) of CCR and take into account the amount
already reversed by the appellants - However, the penalty imposed on the appellants
is set aside. [Para 5, 6]
2015-TIOL-566-CESTAT -AHM
Navpad Textile Industries Ltd Vs CCE, C & ST (Dated: December 22, 2014)
CE - Assessee, a 100% EOU cleared Polyester Gray Knitted Fabrics (PGKF) to another
three EOUs - But, invoices indicates "Polyester Gray Fabrics" - It is submitted that
other EOUs received Polyester Knitted Fabrics and issued certificate in favour of
assessee - Assessee contends that adjudication order was passed without supplying
relied upon documents and without giving proper opportunity of hearing - By letter
dtd 24.3.2014 assessee was directed to collect the relied upon documents and to
appear in hearing on 31.3.2014 - Justice demands that "the parties should have an
opportunity of submitting to the person by whose decision they are to be bound such
considerations as in their judgement ought to be brought before him - So, it is difficult
to file the reply after taking copies within period, as specified in Notice dtd 24.3.2014
- Impugned order set aside and matter remanded to Adjudicating authority: CESTAT
[Para 5, 6]
2015-TIOL-565-CESTAT -DEL
M/s Winsome Yarns Ltd Vs CCE & ST (Dated: January 21, 2015)
Central Excise - CENVAT credit - Appellant, manufacturers of Yarn, availed capital
goods credit during the material period when clearances were effected under
exemption Notification No. 29/2004-CE dated 09.07.2004 as well Notification
No.30/2004-CE dt.09.07.2004 - Yarn meant for export was cleared @4% duty under
claim of re bate - Department viewed that since in respect of clearances of export
under rebate claim, where the goods had been cleared under Notification No. 29/04CE on payment of 4% duty, the appellant were eligible for full duty exemption, as
they satisfied the condition for Notification No. 30/04-CE but they still chose to pay
duty under Notification No. 29/2004-CE, the amount paid towards duty cannot be
treated on duty but only a deposit and the goods have to be treated as the exempted
goods cleared under Notification No. 30/04-CE and since the capital goods in question
have been used exclusively for manufacture of exempted goods, credit would be
inadmissible under Rule 6(4) of Cenvat Credit Rule, 2004 - demand for recovery of
irregularly availed credit confirmed with interest and penalty, agitated herein.
Held : Undisputed that during the material period, the clearances for domestic
consumption had been made at nil rate of duty by availing the Notification No.
30/2004-CE and clearances for export had been made on payment of 4% duty under
Notification No. 29/2004-CE - No input duty credit had been availed and only capital
goods Cenvat Credit had been availed in respect of which there is no prohibition in
Notification No. 30/04 -CE - point of dispute is as to when the appellant have not
availed input duty credit, whether they have option to avail the Notification No.
29/2004-CE where the rate of duty is 4% - Department's contention totally incorrect,
as Exemption Notification No. 29/2004-CE is an unconditional exemption which
prescribes a rate of duty of 4% adv - There is no condition that input duty Cenvat
Credit must be availed; condition of non-availment of input duty Cenvat Credit is for
nil duty under Notification No, 30/2004-CE and this does not mean that an asse ssee
not availing input duty credit can not avail the exemption under Notification No.
29/2004-CE - When an assessee does not avail of input duty credit, he has option to
pay 4% duty under Notification No. 29/2004-CE and also the option to clear his goods
at nil rate of duty under Notification No. 30/2004-CE - when two exemption
Notifications are available to an assessee, he can always opt for the Notification which
is most beneficial for him and in this regard the Department cannot force the
availment of a particular exemption Notification - during the period of dispute the
appellant was clearing the goods by availing full duty exemption as well as on
payment of duty, hence the capital goods cannot be treated as having been used
exclusively in the manufacture of exempted goods and Cenvat Credit in respect of the
same cannot be denied; impugned order deserves no merits, same set aside. [Para 6,
7]
2015-TIOL-564-CESTAT -KOL
M/s Larsen And Toubro Ltd Vs CCE & ST (Dated: December 9, 2014)
Central Excise - Stay / dispensation of pre deposit - CENVAT credit - Tata Steels
entered into four separate contracts with L&T, for supplying drawings, plant &
machinery, erection, testing, commissioning, civil and structural steel work - Tata
Steels availed capital goods credit on material supplied to L&T, who in turn has
discharged service tax against 'works contract services' considering the said job as a
composite contract - Revenue viewed credit inadmissible at Tata Steels since they
availed cenvat credit on the capital goods which were inputs for L & T Ltd., therefore,
the same cannot be treated as capital goods in the hands of Tata Steel - demands
adjudicated with interest and penalties on firms and individuals; and agitated herein.
Held: Prima-facie, Tata Steel Ltd has availed cenvat credit on the capital goods sold/
supplied by L & T, which were later installed and used in or in relation to the
manufacture of finished goods in their premises, a fact not in dispute - not clear as to
how and under what provision, the cenvat credit on the capital goods could be held
inadmissible, as undisputedly, the said capital goods are installed in their factory and
continued to be in their possession and used in the manufacture of finished goods not understandable as how payment of service tax by L&T, treating the project as
works contract, would deprive Tata Steel Ltd to avail credit on the duty paid capital
goods sold/supplied - Applicants made out a prima-facie case for total waiver of
predeposit of dues adjudged; predeposit of dues adjudged against all the Applicants
are waived. [Para 5]
2015-TIOL-562-CESTAT -MAD
Ambi Ply Panels And Doors Vs CCE (Dated: November 28, 2014)
Central Excise - Stay / dispensation of pre deposit - SSI exemption - First Appellant
engaged in the manufacture of Plywood and Block Boards, and claimed the benefit of
SSI exemption under Notification No. 8/2003-CE - Department viewed that two firms
[M/s. The Veera Silver Frames and M/s. Ambigai Lumber Board Works] do not have
the infrastructure in their factory to manufacture plywoods and block boards, that
they have no manufacturing premises, power connection or a generator; and that the
other two units are dummy units - Clearances clubbed and SSI exemption denied in
adjudication - demands confirmed on the firms with interest and penalties imposed on
firms and individuals, who are partners of three units; agitated herein.
Held: Adjudicating authority had given detailed finding on the clubbing of clearance of
other two units with the main applicant; quantification of the demand and eligibility of
cenvat credit will be examined at the time of hearing the appeals at length applicants have failed to make out a prima facie case for waiver of entire amount of
dues; first applle ant firm directed to predeposit an amount of Rs.85,00,000/- (Rupees
eighty five lakhs only) within a period of eight weeks. [Para 5]
2015-TIOL-560-CESTAT -MUM
CCE Vs Shree Datta Ssk Ltd (Dated: November 13, 2014)
CENVAT - Respondents availed credit on inputs and input services pertaining to
manufacture of both dutiable and exempted goods without keeping separate accounts
- Bagasse, a byproduct, on which no duty is payable, used in generation of electricity
as fuel - electricity generated is used captively for manufacturing process and sold to
(MSEDCL) - electricity is not an excisable goods under section 2(d) of Act, hence Rule
6 of CCR is not applicable as held by Supreme Court in case of Solaris Chemtech Ltd respondents not required to reverse an amount of 10% of value of electricity sold to
MSEDCL - No infirmity in impugned order, so upheld - Revenue appeals are
dismissed: CEST AT [Para 2, 7]
2015-TIOL-559-CESTAT -MUM
The Paper Products Ltd Vs CCE (Dated: March 4, 2015)
CE - A SCN should be issued for recovery of interest separately within a reasonable
period if there is no demand for duty - If there is a notice for demand of duty, then no
separate notice is required for recovery of interest - Revenue neutrality is not
embedded in CEA or CER: CESTAT by Majority
Also see analysis of the Order
2015-TIOL-557-CESTAT -MUM
Ishu Super Steel Pvt Ltd Vs CCE (Dated: February 20, 2015)
CX - Inputs burnt in fire - CENVAT - Even though the appellant have lodged with the
Insurance company a claim that 700 MT of Sponge Iron caught fire, the certificate by
the Insurance Surveyor pegs the same at 547.982 MT - CENVAT credit reversed to the
extent of quantity certified by surveyor is proper - no reason for brushing aside the
report since it is not the case of the Revenue that the remaining quantity has been
disposed of otherwise - no physical verification was also undertaken by department to
justify its allegation - remaining quantity was very much available in the factory of the
appellant as per insurance surveyor report - Appeal allowed: CESTAT [para 5, 5.1]
Also see analysis of the Order
2015-TIOL-556-CESTAT -DEL
Videocon Industries Ltd Vs CCE & ST (Dated: January 13, 2015)
CX - Assessee in their factory at Shajahanpur, Distt. Alwar manufacture refrigerators
of brandname Electrolux and Kelvinator - They received services from M/s. Takecare
(India) Pvt. Ltd. for repair and maintenance of refrigerators during warranty period Similarly, IPR service provided by M/s.P.E. Electronics Pvt. Ltd. has been used for use
of brandname 'Electrolux' and service of advertisement has been used for promotion
of brandname 'Kelvinator' - Agreement of appellant with Takecare India Pvt. Ltd. and
M/s P.E. Electronics shows that these agreements are only in respect of unit at
Shajahanpur, Distt. Alwar - Invoices by respective service providers have also been
issued to assessee's company unit at Shajahanpur, Distt. Alwar - No merit in
Revenue's contention that the services in question may have been used in respect of
products manufactured by other factories of appellant company - Stay granted:
CESTAT [Para 6]
2015-TIOL-555-CESTAT -DEL
CCE Vs M/s Glaxo Smithkline Beecham Consumer Healthcare Ltd (Dated:
December 12, 2014)
CX - Assessee engaged in packing of Horlicks and Boost and their sales were through
sales depot located all over the country - Period of dispute is from April 1994 to July
1997 - Duty demand for period of dispute is covered by 8 separate show cause
notices by which duty amounted to Rs.1,55,11,932/- - Assistant Commissioner
confirmed the demand of only Rs.11,58,767/- and operative portion of order is totally
silent about any refund - Assistant Commissioner's order mentions that refund claim
had been rejected by Deputy Commissioner and also rejected by Commissioner (A)
and against this order - No further appeal had been filed - For this reason only,
Assistant Commissione r has demanded duty of only Rs.11,58,767/- and has not
ordered adjustment of amount of demand against any amount becoming refundable,
as refund claim had already been rejected - Impugned O-I-A dated 10/11/05
permitting the adjustment of duty demand of Rs.1 1,58,767/- against excess payment
of duty of Rs.86,54,690/ - is totally wrong and as such there was no authority for the
same - Order set aside and appeal allowed: CESTAT [Para 8]
2015-TIOL-554-CESTAT -BANG
Transformers & Electricals Kerala Ltd Vs CCE, C & ST (Dated: July 25, 2014)
Excise – Interest on differential duty – Manufacture of transformers and allied
products on contract basis – Goods were initially cleared by paying appropriate duty
and price escalated thereafter – Supplementary invoices raised to claim revision of
prices and differential duty was paid on differential value of goods received –
Following precedent in BHEL case, demand of interest on differential duty set aside –
Appeal allowed with consequential reliefs.
2015-TIOL-550-CESTAT -MAD
CCE Vs Tulsyan Nec Ltd (Dated: January 19, 2015)
Central Excise - CENVAT credit - Rule 6 of CCR 2004 - respondents manufactured CTD
bars and cleared the same on payment of duty; they also undertook conversion of
ingots into CTD bars on job work basis and cleared the same under Rule 57F (4)
challan - They have availed input credit on furnace oil and oxygen as fuel - Revenue
viewed that input credit availed on fuel used in the manufacture and clearance of
exempted under Rule 6(2) of CCR was reversible; adjudicated demand for recovery of
8% value with interest and penalty; demands set aside by Commissioner (Appeals)
and agitated by Revenue herein.
Held: During the material period, Rule 6(2) of CCR 2004 stipulates that respondents
should maintain separate inventory of inputs exempted and dutiable except intended
to be used as fuel - Instant dispute is only on the credit availed on fuel used in the
exempted product; issue has already been settled by various High Courts and the
Tribunal, allowing credit on fuel - the lower appellate authority has discussed the issue
in detail and rightly held that credit availed on furnace oil and oxygen which are fuel is
permissible - no infirmity in the impugned order which is upheld [Para 6, 7]
2015-TIOL-545-CESTAT -MAD
M/s Wipro Ltd Vs CCE (Dated: January 20, 2015)
Central Excise – Stay / dispensation of pre deposit – CENVAT credit – Duty paid on
stock of inputs and finished goods at the time of debonding of 100% EOU
subsequently availed as credit, viewed inadmissible by Revenue – demand for
recovery adjudicated and agitated herein on merits as well as limitation.
Held: The appellants while debonding have paid the duty both on the inputs as well as
on the finished goods lying in stock and availed the credit - Prima facie case made out
for waiver of predeposit of entire dues; same granted. [Para 4]
2015-TIOL-544-CESTAT -MUM
M/s Shri Dnyaneshwar Ssk Ltd Vs CCE (Dated: October 17, 2014)
CENVAT - Rule 2(l) of CCR, 2004 - Appellant is a manufacturer of su gar and power
plant is being used for manufacturing of sugar only – ST paid on maintenance and
repair of power plant qualifies as Input Service - pre -deposit of entire amount of duty,
interest and penalty is waived and stay granted: CESTAT [Para 2]
2015-TIOL-543-CESTAT -DEL
M/s Malbros Industries Vs CCE (Dated: January 20, 2015)
CX - Assessee having a shop from where in addition to the plastic goods
manufactured by them, also sold goods procured from other sources - Most of the
goods are not even the Inj. Moulded plastic articles manufactured by assessee but
duty had been demanded in respect of those goods on the basis that assessee have
sold them by printing brand name/logo of customers - Though the assessee had given
the break up of goods purchased from outside and sold from their shop, but this plea
had not been considered at all - Even the assessee's plea that they have no facility for
printing of customer's name/logo on articles and that wherever printing was done on
the customer's request, it was got done from outside has also not been considered Stay granted: CESTAT [Para 6]
2015-TIOL-542-CESTAT -DEL
M/s Singla Cables Vs CCE (Dated: January 14, 2015)
CX - Assessee availing of duty exemption under Notfn. 56/2002 -CE - During the
period from February 2006 to March 2006, assessee had confined to Cenvat credit
availment only to Additional Customs Duty and had not taken Cenvat credit available
in respect of Special Additional Customs Duty (SAD) - To the extent, lesser Cenvat
credit was availed, lesser payment of duty through Cenvat credit and higher payment
of duty through PLA resulting in higher refund under said Notfn - In December 2006
as soon as this was pointed out, they took credit of this amount which results in lesser
refund claim in month of December 2006 - Non-availment of credit was in month of
December, 2006 itself and no SCN has been issued by invoking extended period of
limitation - SCN is barred by limitation as well as appellant succeeds on merit as it is a
revenue neutral situation - Impugned order is set aside and appeal allowed: CESTAT
2015-TIOL-541-CESTAT -DEL
Meneta Automotive Components Pvt Ltd Vs CCE & ST (Dated: December 30,
2014)
CE - Scrap generated in appellant's unit and cleared into DTA - Only use of scrap is for
re-melting - Impugned order denying basic customs duty exemption under Notfn
21/2002-Cus (Sl.No.332) for the purpose of calculation of duty payable in respect of
DTA clearances of scrap in terms to proviso to Section 3(1) of CEA, 1944 is not correct
- Waste general norms have been finalised by Development Commissioner, hence,
denial of benefit of exemption Notfn 23/03 -CE is also incorre ct - Stay granted:
CESTAT [Para 6, 7, 8]
2015-TIOL-539-CESTAT -MUM
Indian Oil Corporation Ltd Vs CCE (Dated: October 8, 2014)
CE - s.4 of CEA, 1944 - Goods sold from ONGC, Nhava Depot - "other charges"
collected at the rate of Rs.172.54 per KL from customers were meant to recover the
additional cost that the appellant was incurring in transporting the goods from
warehouse to depot, storing the goods in the depot and for the investment made in
the storage tanks and pipelines upto the jetties - such charges are includible in
Transaction value as ONGC, Nhava Depot is the place of removal - Appeal dismissed:
CESTAT by Majority.
Also see analysis of the Order
2015-TIOL-532-CESTAT -MUM
NOCIL Ltd Vs CCE (Dated: January 7, 2015)
CE - Cenvat credit on welding electrodes - Though initially, appellant claimed credit
under input, but during adjudication, they made alternate claim before adjudicating
authority under capital go ods - As welding electrodes are used for repair and
maintenance of plant and machinery, appellant is entitled for cenvat credit - Appeal
allowed: CESTAT [Para 5, 6, 7]
2015-TIOL-531-CESTAT -MAD
CCE Vs M/s Tractors And Farm Equipments Ltd (Dated: January 13, 2015)
Central Excise - CENVAT credit - input credit availed on plastic crates denied in
adjudication; allowed by Commissioner (Appeals); and agitated by Revenue herein.
Held: Short issue is eligibility of CENVAT credit on the plastic crates, settled by the
Larger Bench in the case of Banco Products - Basically Revenue filed these appeals
relying on the decisions of the Tribunal in the cases of PKPN Spinning Mills, which was
set aside by the Chennai HC vide judgment dated 14.2.2013 in CMA No. 4162/2005 respondents are eligible for the CENVAT credit availed on plastic crates as inputs /
material handling equipment; no infirmity in the order passed by the lower appellate
authority; same is upheld [Para 6, 8]
2015-TIOL-529-CESTAT -AHM
M/s Hindustan Gum And Chemicals Ltd Vs CCE (Dated: January 16, 2015)
CE - Whether the appellant is required to pay MOT charges (Merchant Overtime Tax)
for the services rendered by Departmental Officers (as Customs Officers) during office
hours for any Customs examination/work is being done in their factory/ware house As per Sigma Corporation Ltd, no fee is payable on the stuffing work done in factory
of the assessee under the supervision of jurisdictional Central Excise Officers d uring
working hours only - Impugned order set aside and appeal is allowed: CESTAT
2015-TIOL-526-CESTAT -DEL
M/s Delphi Automotive Systems Pvt Ltd Vs CCE, ST ( Dated: January 06,
2015)
CX - Exemption Notfn 6/2000-CE - Appellant are manufacturers of parts/components
of car air conditioners - Department alleges that the appellant are supplying complete
air conditioning machines in SKD/CKD condition and, therefore, exemption is not
available - In respect of supplies to M/s Daewoo Motors, appellant have manufactured
only compressors, blowers and condensers and the Heater Evaporators had been
imported and supplied from trading premises located at a different place and no
cenvat credit in respect of Heater Evaporators had been taken - Appellant, therefore,
cannot be considered to have supplied Heater Evaporator along with compressors,
blowers and condensers - It is the parts manufactured and supplied by a
manufacturer which have to be taken into account and not the parts which were not
manufactured and supplied as trading activity for the purpose of said Notification as
amended and its successor notifications - Appellant have placed on record invoices
under which the traded items were supplied and these invoices were issued as
registered dealer and trading premises were at a place different from the location of
factor - Stay granted: CESTAT [Para 6, 7]
2015-TIOL-524-CESTAT -DEL
M/s International Tobacco Co Ltd Vs CCE & ST (Dated: January 21, 2014)
CX - Assessee paid duty on Cigarette during the period from 17.03.2012 to
27.05.2012 at the rate announced in budget on 16.03.2012 in terms of clause 141 of
Finance Bill 2012 while Department views that duty would be chargeable at the rate
as per amendment moved on as 08.05.2012 - As per Board's Circular No.
981/5/2014 -Cx , since the amendment to the Finance Bill, 2012 moved on
08.05.2012 was not accompanied by declaration under section 3 of PCT Act, the
enhanced rate announced in terms of amendment to the Finance Bill would be
applicable only from 28.05.2012 - Order set aside and appeal allowed: CESTAT [Para
3, 5]
2015-TIOL-519-CESTAT -BANG
M/s Sampre Nutrition Ltd Vs CCE, C & ST (Dated: December 4, 2014)
Excise - Cadbury chocolates - Valuation - Duty payable whether on the basis of cost
construction or price at which manufacturer sells chocolates on their own account Debatable issue - For earlier periods, matter was remanded by waiving pre-deposit on
considering the issue in question - Precedent followed - Matter remanded to decide
without insisting pre-deposit.
2015-TIOL-518-CESTAT -MUM
CCE Vs Moulds & Dies Pvt Ltd (Dated: January 22, 2015)
CE - ROM application by Revenue - First order of Tribunal clearly covers both the
SCNs covered by single adjudication order - although earlier order was brought to the
notice of the Tribunal, Second order of Tribunal again covers both SCNs and gives an
impression that Tribunal thought that the two cases though are similar but are
different inasmuch as order is for different period - Well settled legal position is that if
a matter is decided by any adjudicating authority or any appellate authority, the said
authority cannot decide it again - Second judgment or order has to be ignored or is
non est in eyes of law: CESTAT
2015-TIOL-513-CESTAT -BANG
CCE Vs M/s Wipro Gemedicals Systems Pvt Ltd (Dated: November 14, 2014)
Central Excise - Goods cleared at nil rate - Demand of reversal of 8% amount
collected from customers under Section 11-D - Not applicable - Submission by
Revenue that that the customers might have taken credit of duty paid, not accepted Appeal by Revenue devoid of merits - Cross Objection filed by the assessee disposed
of. (Para 4)
2015-TIOL-512-CESTAT -BANG
M/s Nectar Beverages Pvt Ltd Vs CCE, C & ST (Dated: November 14, 2014)
Central Excise - Cenvat Credit - Admissibility - Manufacturer of aerated water -Annual
maintenance of refrigerators and cooling equipment stored in the premises of
dealers/retailers prima-facie is not an input service but basically is a post removal
activity - Credit of service tax paid on such charges, not admissible - No reason to
deviate from final order passed earlier in respect of same appellant - Appellant is
directed to deposit the entire amount of CENVAT credit with interest - Pre -deposit of
balance dues waived. (Para 3)
2015-TIOL-511-CESTAT -MAD
M/s Indian Oil Corporation Ltd Vs CCE (Dated: December 15, 2014)
Central Excise – Demand under Sec 11D made on depot, who is not a manufacturer
not sustainable in terms of the Tribunal ruling in the IOCL case.
2015-TIOL-510-CESTAT -MAD
M/s Hindustan Unilever Ltd Vs CCE (Dated: November 14, 2014)
Central Excise – Valuation – appellants are engaged in the manufacture of shampoo
and claimed abatement towards equalized sales tax provisionally on the basis of the
particulars available for the previous quarter - During the finalization of the
assessment, the appellants produced the Chartered Accountant's Certificate for the
average sales tax on products price, however, it was held that equalized or average
sales tax cannot be allowed for abatement under Section 4 of the said Act – denial of
abatement challenged herein.
Held: issue is no longer res integra, in view of various decisions of the Tribunal in the
appellant's own case - In the Britannia Industries case relied upon by Revenue, the
High Court in respect of deduction of freight charges in price observed that the
Chartered Accountant's Certificate and P&L account is not conclusive proof of such
payments - None of the final orders of the Tribunal was challenged by the Department
before the appellate forum - no reason to take a different view from the earlier final
orders - impugned orders are set aside. [Para 3, 4]
2015-TIOL-504-CESTAT -MUM
M/s ITW India Ltd Vs CCE (Dated: January 8, 2015)
CE - s.4 - Valuation - Appellant was manufacturing parts on behalf of M/s. Whirlpool
India Ltd. - Supply of moulds free of cost by M/s. Whirlpool India Ltd is additional
consideration and amortization cost of moulds is to be added for arriving at AV of
finished product - Appellant have subscribed in invoice to fake declaration that price is
sole consideration for sale and no other consideration in any form is flowing back to
them - Extended period is correctly invoked and demand is correctly confirmed Interest also chargeable u/s 11AB of CEA, 1944 - Penalty already set aside by
Commr(A) - Appeal dismissed: CESTAT [Para 6]
2015-TIOL-503-CESTAT -BANG
Universal Power Transformers Pvt Ltd Vs CCE, ST & C (Dated: November 25,
2014)
Central Excise - Cenvat Credit - Clearances made to developers of SEZ without
payment of duty - Recovery of duty on such clearances - Applicability of Proviso to
Rule 6 (6) of CENVAT Credit Rules 2004 - Following precedents as well as Revenue
conceded in favor of appellant, impugned order set aside. (Para 2)
2015-TIOL-502-CESTAT -MAD
M/s Sri Krishna Alloys Vs CCE (Dated: December 22, 2014)
Central Excise – Undervaluation – Common individuals being Partners in appellant unit
and Directors in buyer firm – Revenue viewed that the partner of the appellant being
directors in the buyer firm, mutuality of interest cannot be ruled out; that when the
supply of goods was made by own truck of the appellant to the buyer, there was
undervaluation of the goods to the extent of the freight; and that the CAS4 report
proved the undervaluation against the appellant – demands confirmed and agitated
herein.
Held: To prove mutuality of interest, the essential ingredient of influence over price of
the appellant is absent - SCN does not speak about the mode of transport resulting in
undervaluation; mere allegation that there was mutuality of interest remained
unproved - CAS4 does not exhibit as to the manner how the appellant undervalued
the goods to lead its defence - In absence of appropriate allegation in the show-cause
notice, leading of evidence to rebut CAS4 is inconceivable - The appellant has brought
out categorically that the representative transaction value was verifiable from the
supply price of different suppliers; there was no inquiry on that count also; there was
a lso no further inquiry done as to the reason why the entire supply of the goods
manufactured by appellant was sold to the sole buyer aforesaid - When there is no
contradiction by evidence that the transaction value of the competitors was not
representative or ascertainable equivalent price, it is difficult to agree with Revenue
on the allegation of undervaluation - Invoking of Rule 10 of the Valuation Rules on the
allegation of interconnected undertaking would have been appreciated had there been
material brought on record to show that such an interconnection caused
undervaluation. [Para 5, 6, 7]
2015-TIOL-500-CESTAT -MAD
M/s Steel Authority Of India Ltd Vs CCE (Dated: December 22, 2014)
Central Excise – CENVAT credit – Duty paid on Value including 'Fixed Facility Charges'
(FFC) and 'Minimum Take or Pay charges' (MTOP) upstream; credit denied
downstream by Revenue on the ground that the supplier ought not to have charged
duty on these elements – Denial of credit, demands thereto disputed herein.
Held: All the three appeals are remanded to the Adjudicating authority for readjudication in the light of the Board clarification dated 10.11.2014. [Para 7]
2015-TIOL-495-CESTAT -DEL
Akansha Sales Promoters Vs CCE & ST (Dated: September 1, 2014)
Central Excise – Stay / Dispensation of pre deposit – Classification of "canopies",
Valuation and clubbing of clearances under dispute herein - the canopies
'manufactured' by the appellants have no walls or windows and therefore would not
fall under Chapter heading 94.06 – duty demand on the basis of that classification
unsustainable – pre deposit waived.
2015-TIOL-492-CESTAT -DEL
M/s Pushkar Steels Pvt Ltd Vs CCE (Dated: January 14, 2015)
CE - Notfn 50/03-CE - Assessee's unit was in existence much before the issuance of
exemption Notfn 50/03-CE and when compounded levy scheme for induction furnace
unit had been notified under Section 3A of CEA, 1944 - Production capacity of
assessee increased from earlier 3 M.T. during the period prior to 07/1/03 to 4 M.T.
during the period after 7/1/03 - Commercial Tax Department has accepted the
assessee's claim regarding purchase of components of furnace from outside the state
and has decided to impose penalty only on the ground that procedure prescribed in
this regard was not followed - Ground on which the Commissioner has rejected
assessee's claim regarding purchase of induction furnace components is not correct As per Uttaranchal Iron & Ispat Ltd . 2008-TIOL-1533-CESTAT-DEL , once it is
accepted that the increase in capacity of crucible was achieved by increasing its
height, the benefit of exemption under said Notfn cannot be denied - Order set aside
and appeal allowed: CESTAT [Para 6, 7]
2015-TIOL-491-CESTAT -BANG
CCE, ST & C Vs M/s Universal Biofuels Pvt Ltd (Dated: December 2, 2014)
Central Excise - Clearances made by 100% EOU to Domestic Tariff Area Computation of Education cess decided in favor of assessee - Stay sought by Revenue
against - Grant of stay would result in reviving demand not permissible - Stay
application hence rejected as infructuous.
2015-TIOL-490-CESTAT -MAD
M/s Thio Chemi Pvt Ltd Vs CCE (Dated: November 19, 2014)
Central Excise - Stay / dispensation of pre deposit - Classification - Appellant classified
‘Khatnil', a kerosene based cleaning material, under sub-heading No. 3808 9990 Revenue viewed the same classifibale under sub-heading No. 38078 9191 of the First
Schedule to the Central Excise Tariff Act, 1985 - demands adjudicated based on
promotion materials and agitated herein.
Held: Applicant advertised impugned product as "for Borer & Termite" and g iven
directions for use of this product as "For effective control of Borer & Termite"; demand
of duty was raised on the basis of their declaration in the trade parlance - However,
there is force in the submission that the classification is frequently changed and
therefore extended period of limitation cannot be applied - Appellant's claim on
financial hardship found inconsistent with the statement of profit and loss account for
the year ending March, 2013 - applicant failed to make out a prima facie case for
waiver of pre -deposit of entire dues; and is directed to make a pre-deposit of Rs.
30,00,000/- (Rupees Thirty lakhs only) within a period of eight weeks. [Para 3, 4]
2015-TIOL-484-CESTAT -DEL
M/s Sun Food Tech Vs CCE (Dated: December 26, 2014)
CE - SSI exemption Notfn 9/2002-CE - Appellant had sent the declaration under
certificate of posting through postal authorities - Since the department does not
dispute the appellant's claim regarding sending of declaration from Mayapuri Post
Office under certificate of posting and also it is not disputed that otherwise, appellant
are eligible for exemption - Benefit of exemption cannot be denied just because the
declaration was not received in the office of Dy. Commissioner or in Range
Superintendent more so, when a copy of the declaration dated 28.08.2002 has been
produced before the Asstt. Commissioner - Order set aside and appeal allowed:
CESTAT [Para 7]
2015-TIOL-483-CESTAT -DEL
M/s Triveni Glass Ltd Vs CCE & ST (Dated: August 19, 2014)
Central Excise - Stay / dispensation of pre deposit - Offence case - appellant is
engaged in the manufacture of sheet glass of various sizes and shapes - officers
visited the Unit, detected goods loaded for dispatch without entry in stock register /
CE invoice; initiated investigation, scrutiny of records, recording of statements and
concluded clandestine manufacture clearances - demands adjudicated with interest
and penalties on firm and individuals, agitated herein.
Held: entire case of the Revenue is based upon the theoretical calculation of the
alleged excess production, adopting maximum installed capacity - final product being
very fragile and sensitive, results in lot of wastage, for which the appellants have also
maintained proper records - wastage arises at various stages ignoring the set of final
cutting of the glass into proper shape and sizes resulting in emergence of cullets i.e.
the resultant waste, which are never cleared by the appellant and are reused in the
furnace for the manufacture of their final product, for which proper records are again
maintained - virtually no evidence of procurement of excess raw material, conversion
of the same into final product, clearance of the same through transporters and
identification of the buyers and the consequent flow of money from the buyers
established by Revenue - allegations of clandestine removal cannot be upheld on the
basis of surmises and conjunctures and are required to be established by production
of positive and tangible evidence - prima facie , no preponderance of probabilities to
conclude the allegations of clandestine removal against the appellant - further,
financial hardship observed since the Unit is referred to BIFR - pre deposit dispensed
with. [Para 5, 6, 7, 8]
2015-TIOL-482-CESTAT -MAD
CCE Vs M/s Rawf Re-Rollers (Dated: September 25, 2014)
Central Excise – Clandestine clearances - respondent engaged in the manufa cture of
M.S. Rounds; Officers of DGAE visited the premises, investigated, detected illicit
removals under traders invoices during the material period – demands adjudicated
with interest and penalties on firm and individuals under Rules 173Q and 209A of
erstwhile CER 1944; Commissioner (Appeals) set aside demands on the ground of lack
of corroborative evidence; and agitated by Revenue herein.
Held: Nothing brought on record to correlate the allegation of illicit removal of M.S.
Rounds from the appellant's factory to establish evasion of duty - findings of the
Adjudicating Authority are cryptic and no cogent evidences brought to establish the
clandestine removal; demands solely based on the statements - To establish
clandestine clearance and evasion of excis e duty, it is obligatory on the part of the
Revenue to establish in clear terms with corroborated evidence, statutory records,
financial transaction of the appellants or from the buyer etc. [Para 5, 6]
Patna HC ruling in the Brims Products case is squarely applicable to the facts of the
present case; same followed - there is no infirmity in the impugned order, which is
upheld. [Para 8]
2015-TIOL-480-CEST AT-BANG
Ultratech Cement Ltd Vs CCE, ST & C (Dated: November 20, 2014)
Central Excise - Cenvat Credit - Entitlement - Construction of capital goods -Credit
availed on steel and cement used in construction of Packing Plant and Storage Sylos
(tank) - Prima facie admissible - Argument by Revenue that Sylos storage is totally
different from a storage tank, not appreciated - Pre-deposit of balance dues waived.
(Para 2)
2015-TIOL-479-CESTAT -MUM
M N Furniture Vs CCE (Dated: February 12, 2015)
CE - Carpentry work awarded to appellants by UTI was sub-contracted to independent
contractors – whether sub-contractor is the manufacturer – M(J) & M(T) have
divergent views on merits, however, agree that demand is hit by limitation – Appeals
allowed: CESTAT
Also see analysis of the Order
2015-TIOL-474-CESTAT -MAD
M/s S P Fabricators Pvt Ltd Vs CC (Dated: August 6, 2014)
Central Excise - CENVAT credit - appellants are manufacturers of Aluminium
Composite Panels with Glass, cleared to DTA on payment of duty and to SEZ
developers without duty, under ARE1 - Revenue viewed that the appellants have not
maintained separate accounts in terms of Rule 6(2) of Cenvat Credit Rules, and used
common inputs in the manufacture of dutiable and exempted finished goods cleared
to non -SEZ buyers (i.e. SEZ developers) - Demand for 10% ‘amount' of value of
goods cleared to SEZ developers adjudicated with interest and agitated herein.
Held: Appellants while clearing the goods followed the procedure stipulated under
Rule (30) of SEZ and Rule (19) of CER; impugned clearances are treated as export
duly accompanied by ARE-I certified by jurisdictional superintendent - Tribunal ruling
in the Sujana Metal Products case (subsequently upheld by APHC); and Chattisgarh
HC ruling in SAIL case examined identical issue and held inter alia that the goods
supplied to SEZ developers are to be treated as exports under Section 2 (m) of SEZ
Act; and that the amendment introduced in Rule 6(6) on 31.12.2008 is retrospective
in nature - Chattisgarh HC ruling followed; demands held unsustainable and impugned
order set aside. [Para 4, 5, 6, 7]
2015-TIOL-472-CESTAT -MUM
CCE Vs M/s Ankur Packaging Pvt Ltd (Dated: January 08, 2015)
CE - Valuation - s.4 of CEA, 1944 - If the scrap is retained by the job worker, sale of
the same will affect the conversion charges towards job work and hence the same
should be included in the assessable value of the job work goods - Revenue appeal
allowed: CESTAT [para 5]
Also see analysis of the Order
2015-TIOL-471-CESTAT -AHM
CCE Vs Chiripal Industries Ltd (Dated: January 07, 2015)
CE - Assessee engaged in manufacture of Polyester Partially Oriented Filament Yarn
(POY) and Polyester Fully Drawn Filament Yarn (FDY) - SCNs were issued proposing
demand of NCCD on the ground that they have not paid NCCD on captive
consumption - Assessee reversed the amount from cenvat account under protest Commissioner (A), set aside the adjudication order and allowed the appeal with
consequential relief, therefore, assessee took suo moto credit - Aggrieved, hence
appeal - Held: order passed by Commissioner (A) is upheld and appeal filed by
Revenue is rejected: CESTAT [Para 7, 8, 9]
2015-TIOL-466-CESTAT -BANG
VST Industries Ltd Vs CCE, C & ST (Dated: December 3, 2014)
Excise – Cut tobacco and cigarette manufacturing – Cut Tobacco which forms part of
tobacco refuse cleared without payment of duty as per Notification No. 3/2005 CE
dated 24.2.2005 as amended – Denial of Exemption notification No. 52/2002 CE dated
17.10.2002 and imposition of penalties on ground that tobacco refuse is excisable
goods, marketable and can be sold for consideration, wholly unwarranted since
tobacco refuse cannot be considered as a final product but is merely a by-product –
Levy of duty on such refuse not proper – Demand and penalties hence set aside –
Appeals allowed with consequential reliefs. (Para 7, 8, 9, 10)
2015-TIOL-463-CESTAT -MUM
M/s GKN Sinter Metals Pvt Ltd Vs CCE (Dated: February 2, 2015)
CE - rule 4(4) of CER, 2002 - s. 2(a), s.35B(1) of CEA, 1944 - Application seeking
permission to temporarily store finished goods outside the factory without payment of
duty as construction activity was being undertaken - Commissioner rejecting the
request - Against order passed by Commissioner in terms of rule 4(4) of C ER, 2002,
appeal lies before the Tribunal: CESTAT [para 5]
Also see analysis of the Order
2015-TIOL-462-CESTAT -AHM
M/s Torrent Pharmaceuticals Ltd Vs CCE (Dated: January 12, 2015)
Central Excise - Stay / dispensation of pre deposit - extension of stay - miscellaneous
application filed for extension of period of stay granted vide Stay Order No.
S/430/WZB/AHD/2011, dt.28.03.2011; under consideration herein.
Held: Larger bench, in Haldiram India case held that the Stay Order passed by the
Tribunal may be extended after considering the necessary facts as it would authorize
the exercise of discretion by the Tribunal for grant of such extension - appeal was not
taken for hearing by the Tribunal as there is huge pendency of the appeals; noted that
lot of appeals have already been listed and therefore it is difficult to take up the
appeals hearing at this stage - extension of stay granted till the disposal of the
appeal. [Para 2, 5, 6]
2015-TIOL-458-CESTAT -MAD
M/s Sesha Sayee Paper And Boards Ltd Vs CCE (Dated: January 13, 2015)
Central Excise – Refund - Appellants claimed refund of excess duty paid on account of
change of duty rate for one day ie., on 07.12.2008, where the rate of duty on paper
and paper products reduced from 8% to 4% vide Notification No. 58/2008 dated
07.12.2008 – Claim rejected in adjudication; allowed by Commissioner (Appeals) and
agitated by Revenue before the Tribunal, who restored the original authority's
rejection of refund – Meanwhile, refund was paid in the wake of Commissioner
(Appeals) order; and consequent o the Tribunal ruling in favor of Revenue,
proceedings initiated to recover erroneous refund; demand for its recovery
adjudicated; upheld by Commissioner (Appeals), and agitated herein.
Held: Tribunal has already decided and settled the issue in favour of Revenue, holding
that the appellants are not eligible for refund on account of unjust enrichment and
restored the original adjudication order - Commissioner (Appeals) has rightly rejected
their appeal by relying upon this Final order - Though the appellants have filed CMA
No. 1929/2011, which is pending before the Hon'b le High Court, there is no stay
against the final order of the Tribunal - no infirmity in the impugned order. [Para 4]
2015-TIOL-454-CESTAT -BANG
Sri Chakra Cements Ltd Vs CC, CE & ST (Dated: November 7, 2014)
Central Excise - Cenvat Credit - Eligibility - Cenvat credit on items like MS angles,
beams, sheets, channels etc used in maintenance and repair of fabrication works Denied for want of necessary documents - Item wise actual usage provided - Held,
issue of admissibility of credit is highly debatable, and requires detail consideration of
the actual usage - Pre -deposit waived. (Para 3)
2015-TIOL-453-CESTAT -AHM
M/s Stalmec Engineering Pvt Ltd Vs CCE & ST (Dated: December 30, 2014)
Central Excise - Appellate Jurisdiction - Rebate in respect of goods exported on which
duty paid from accumulated credit denied in adjudication, demand for recovery
confirmed, upheld by Commissioner (Appeals) and agitated herein - Revenue raised
preliminary objection on maintainability of appeal at Tribunal.
Held: Clause (b) of the first proviso to sub-Section (1) of the Section 35B of the
Central Excise Act, 1944 provides that no appeal shall lie to the Appellate Tribunal and
the Appellate Tribunal shall have no jurisdiction to decide any appeal referred to in
clause (b) of the said sub-Section, if such order relates to rebate of duty of excise on
goods exported - instant appeal relates to improper payment of rebate under Rule 18
of the Central Excise Rules and the impugned order passed by the Commissioner
(Appea ls), squarely covered under the first proviso to Section 35B (1) of the Central
Excise Act, 1944 - The appeal relating to rebate of duty of excise of goods exported is
not maintainable before the Tribunal; is dismissed as not maintainable - Appellant is
a t liberty to file appeal before the competent authority, who would consider the
condonation of delay in filing of appeal in accordance with law. [Para 2, 4, 6]
2015-TIOL-450-CESTAT -MAD
The Salem Co-Operative Sugar Mills Ltd Vs CCE (Dated: December 11, 2014)
Central Excise - CENVAT credit - Obligation under Rule 6 of CCR 2004 in respect of
common inputs used for manufacture of both dutiable and exempted products;
demand for reversal of prescribed percentage of value of exempted clearances is
under dispute herein.
Held: Facts akin to those considered by the Tribunal in the Rajashree Sugars case Legislature has thoughtfully enacted that when common input is used in manufacture
of excisable and non -excisable goods and no evidence of allocation of input is led, the
levy @ 10% by law is warranted - appellant's plea that 10% levy is unwarranted is
not entertainable when no evidence is on record to show that allocation is verifiable 10% of the amount has already been paid and appropriation thereof is made; subject
to verification of such version, lower Authority shall do the needful - In view of
practical difficulties of interpretation of statute, there shall be no penalty on the
appellant. [Para 3, 4, 5]
2015-TIOL-444-CESTAT -MAD
CCE Vs M/s Taj Madras Flight Kitchen Pvt Ltd (Dated: January 27, 2015)
Central Excise – SSI exemption – Revenue viewed that since the appellant firm is part
of the Taj group of hotels, benefit is inadmissible – denial of SSI exemption proposed
in the notice is the focus of Revenue's appeal herein.
Held: Clear from SCN that the appellant had supplied the goods without any brand
name or logo embossed thereon; that goods purchased for supply did not carry any
brand name or logo - Revenue sought to deny the exemption through an addendum,
on the ground that the appellant was a part of the group company - nothing was spelt
out in the show-cause notice which was originally issued as to the manner why the
exemption benefit is not permissible to the respondent, which is only a bald showcause notice without bringing out the allegation in clear terms for defence of the
Respondent - Without specific and clear allegations and materials relied upon to make
allegation, it cannot be said that the show-cause notice was proper in providing
foundation to adjudication, as held by the Apex Court in various rulings - nothing
apparent from show-cause notice demonstrating that the respondent was
instrumentality of the group company to claim SSI exemption - In absence of
corpora te veil being lifted by the show-cause notice itself that fails to provide a basis
for adjudication and entire adjudication fails to stand. [Para 3, 5, 6]
2015-TIOL-443-CESTAT -BANG
Sri Chamundeswari Sugars Ltd Vs CCE, CC & ST (Dated: November 25, 2014)
Central Excise - Delay in filing appeal - Whether within limitation - Change of
Jurisdictional office of Commissionerate subsequent to filing of appeal papers in time
and transfer of file by department to designate jurisdictional Commissioner - Receipt
of said appeal in the office of designate jurisdictional Commissioner must be
considered to have been filed within limitation - Appellant need not file delay
condonation application as there is no delay - Rejection of appeal as time barred is
erroneous - Matter remanded. (Para 2)
2015-TIOL-440-CESTAT -MAD
CCE Vs Concrete Products & Construction Co (Dated: September 11, 2014)
Central Excise - Valuation - respondents are manufacturers of Concrete Sleepers Revenue viewed that differential duty equivalent to modvat credit availed merited
inclusion for assessment to duty as additional consideration retained by the
respondent - Proposals dropped in adjudication, OIO upheld by Commissioner
(Appeals), and agitated by Revenue herein.
Held: The short issue in this case is valuation under Section 4 of Central Excise Act
whether the amount of Rs.49.36 allowed to be retained by the respondents from the
price or not - original authority dropped the proceedings by relying on ruling in the
case of Mahadev Industries and the Apex Court ruling in the case of Dai Ichi Karkaria
- Commissioner (Appeals) relied on the ruling in the case of Kottukulam Engineers
vide Final order No.781 to 784/2002 - respondent has rightly discharged the excise
duty as per contract price which is a sale price - no reason to interfere with the
impugned order. [Para 5]
2015-TIOL-439-CESTAT -DEL
M/s Asha Telecom P Ltd Vs CCE (Dated: January 12, 2015)
CE - Shortage of inputs - Assessee has admitted shortage of inputs and clearance
thereof without payment of duty - Extended period of limitation is rightly invoked Appellant has paid only duty and not interest - As per section 11 AC of CEA, 1944,
appellants are required to pay penalty equivalent to duty - Appeal dismissed: CESTAT
[Para 7]
2015-TIOL-438-CESTAT -DEL
M/s U P Pumps Pvt Ltd Vs CCE (Dated: December 26, 2014)
CE - Classification - Appellant are manufacturers of Treadle Pumps, which are feet
operated pumps designed for lifting water to the surface from depth upto 7 Mts Whether Treadle pumps are classifiable under sub-heading no.8413.80 as "other
pumps for liquids" or classifiable as "mechanical appliances of a kind used in
agricultural or horticulture" under heading no. 8424.10 of the Tariff - Though the same
are primarily meant for agricultural uses, fact remains that the same are feet
operated pumps for handling water - Same cannot be said to be the mechanical
appliances for projecting, dispersing or spraying liquids or powders and thus, the
same cannot be treated as irrigation system - Goods are correctly classifiable under
Heading 8413.80 - Appeal dismissed
2015-TIOL-437-CESTAT -BANG
Sagar Cements Ltd Vs CCE, C & ST (Dated: September 18, 2014)
Excise – Cenvat eligibility – Place of removal – Appellants paid freight and supplied
the goods at the premises of customers on ‘FOR destination' and MRP basis – Place of
removal is buyer's premises – Merely that invoice was prepared at appellant factory is
irrelevant – Following precedents on issue in question, pre-deposit waived. (Para 5)
2015-TIOL-435-CESTAT -MUM
Raheja Plastics Vs CCE (Dated: January 2, 2015)
CE - Appellant are job workers for M/s Pidilite Industries Ltd. - Cenvat credit on inputs
availed on basis of two bills of entry which are not in the name of appellant, but in the
name of M/s. Pidilite Industries Ltd - It is alleged that ap pellant had availed irregular
credit and same is recoverable u/r 15 of CCR. Held - As per Advanced Enzyme
Technologies Ltd - 2014-TIOL-438-CESTAT-MUM, no dispute that import
consignments have not suffered CVD or that the said consignments have not been
received at appellant's factory - Bill of entry is specified document on the strength of
which cenvat credit can be availed - Impugned order set aside and appeal allowed:
CESTAT [Para 2, 5, 7]
2015-TIOL-431-CESTAT -AHM
M/s Shree Radhey Krishna Process Vs CCE (Dated: January 6, 2015)
CE - Clandestine removal of goods - case is made out on the basis of folding report,
transport documents and miscellaneous papers resumed - it cannot be said that the
case is made only on the basis of statements - appellant has not countered the
documents referred in the SCN as well as adjudication order - extended period of
limitation is rightly invoked - order upheld and appeals are rejected: CESTAT [ para 6,
7]
2015-TIOL-430-CESTAT -MUM
CCE & C Vs Jalna Sidhivinayak Alloys Pvt Ltd (Dated: August 08, 2014)
CE - Assessee availed CENVAT Credit on capital goods during financial year 2000-01
and 2001-02 for capital goods acquired during 2000 -01 - assessee had availed 50%
credit during 2000 -01 and had claimed depreciation on balance amount of fixed assets
under IT Act for year ended 31.3.2001 - credit of balance 50% availed in financial
year 20 01-02 - assessee have produced sufficient document, before issue of SCN that
they have rectified mistake and have reduced amount of cenvat credit from the asset
value, which fact in spite of being on record, have gone un-noticed both in SCN and
O-I-O as we ll as O -I-A- - appellate order is uphold both on ground of limitation as well
as on merits - appeal of Revenue is dismissed and cross -objection of assessee is
allowed: CESTAT [Para 2, 8]
2015-TIOL-428-CESTAT -DEL
M/s Okay Glass Industries Vs CCE (Dated: February 9, 2015 )
Dishonest adjudication exercise - Commissioner defying the Tribunal's directions and
passing an order which should never have been passed - Cost of Rs.10,000 /imposed: CESTAT [ para 14]
Also see analysis of the Order
2015-TIOL-423-CESTAT -DEL
M/s Rajat Industries Pvt Ltd Vs CCE & ST (Dated: December 15, 2014)
CE - Abatement - Rule 10 of Pan Masala Packing Machines (capacity determination &
collection of duty) Rules, 2008 - for claiming duty abatement of the period during
which a Pan Masala/ Gutkha Manufacturing unit was totally closed, the conditions
prescribed in this Rule are that the closure must be for 15 days or more and at least
three working days prior to commencement of closure, information should be given to
the jurisdictional officer and, thereafter, the jurisdictional officers should seal these
machines in such a manner that the same cannot be operated during the said period application of intimation for closure from 15.01.2013 was given on the 10.01.2013
and was received in the office of Assistant Commissioner as well as Superintendent on
same day - AC gave orders for sealing of machines on 11.01.2013 (a holiday) and
sealing was done on 14.01.2013 - after completion of closure period, machines desealed on 01.02.2013 - abatement sought to be denied on the ground that intimation
for closure was not given three 'working' days prior to commencement of closure.
2015-TIOL-421-CESTAT -DEL
CCE Vs M/s Birla Masuzawa Silk Mills Ltd (Dated : January 9, 2015)
CE - Limitation - Once it is accepted that the respondent under their letter had
intimated the Department that they would be making DTA clearances on payment of
applicable duty which in their case is nil, and when the invoices under which the DTA
clearances were made at nil rate of duty also bear the signatures of the CE Officers,
the Department cannot allege that the appellant had concealed the fact of making the
DTA clearances at nil rate of duty - non filing of ER-2 returns would not make any
difference, as the departmental officers otherwise knew that the respondent were
making DTA clearances at nil rate of duty - It is not the allegation of the Department
that the jurisdictional CE Officers were in collusion with the Respondent company and
had collaborated with the Respondent in evasion of duty - There is no infirmity in the
Commissioner's order holding that the longer limitation period is not applicable consequently, there is no question of demanding any interest u/s 11AB of the CEA ,
1944, as it then existed and also there is no justification for imposition of penalty on
GM and Directors of the company u/r 209A of CER , 1944 - Granting of cum-duty
benefit is in accordance with apex court decision in Maruti Udyog - No merit in
Revenue appeals, hence dismissed: CESTAT [ para 4.1, 5]
2015-TIOL-417-CESTAT -MAD
M/s Castrol India Ltd Vs CCE (Dated : October 23, 2014)
Central Excise - Stay / dispensation of pre deposit - CENVAT credit - applicants are
engaged in the manufacture of Automotive Grade Lubricants and Specialty Oils as also
trading activities of imported lubricating oils, through their various depots - used
common input service in respect of dutiable final products as well as trading goods;
proportionate credit reversed on audit intervention - later notice issued, proposing
demand of ‘amount' @10/8/6% on the clearance value of the trading goods of the
entire company - demands adjudicated with interest and penalty, agitated herein.
Held: Proportionate input service credit used in trading activity appropriated - on
being pointed out by the audit, the applicant reversed/paid the amount based on the
formula as per Rule 6(3A) (b) (ii) of CCR,2004 even before the issue of the show
cause notice - applicant in their reply to the show cause notice categorically disputed
the quantification of the demand in so far as that the demand was determined on the
total value of the trading turnover of the entire company, which is ex-facie bad in law;
and the adjudicating authority had not given any findings on this issue - Tribunal in
the case of Mercedes Benz India held that “exempted goods” in Rule 2(e) CCR
includes trading in prospective nature from 01.04.2011 - Prima facie, applicants have
reversed the proportionate input service credit and therefore, it is a fit case for waiver
of predeposit of the entire amount along with interest and penalty. [Para 4]
2015-TIOL-416-CESTAT -MAD
M/s ITC Ltd Vs CCE (Dated : November 17, 2014)
Central Excise - Clarification - Interim Order No. 37/2014 dated 11.02.2014 = 2014TIOL-605-CESTAT -MAD decided three issues in favour of the applicant/assessee demand of duty on third issue is on "unabsorbed overheads and cost of closing stock"
whereas the interim order in respect of issue No.3, held that the "unabsorbed
overheads referable to abnormal idle capacity for lack of order shall not form part of
the cost of production and the demand of duty is not sustainable" - Appellant submits
that in order to implement this order, the words "cost of closing stock" should be
incorporated therein; culminating in the miscellaneous application (MA).
Held: On the face of record, the unabsorbed overheads referable to abnormal idle
capacity for lack of order would include the closing stock, which shall not form part of
the cost of production - Tribunal held that the demand of duty is not maintainable on
the 3rd issue; clear that inadvertently the words "the cost of closing stock" were
omitted in the said paragraph - Case law relied upon by Revenue distinguished
inasmuch as in the present case, application filed by the applicant is not for review of
the order; but for rectification of an error apparent on the face of the records that
words "cost of closing stock" shoul d be incorporated in the paragraph 7.4 of the Final
Order - so clarified. [Para 4, 5, 6]
2015-TIOL-415-CESTAT -MAD
M/s Rane Madras Ltd Vs LTU (Dated : November 5, 2014)
Central Excise - Stay / dispensation of pre deposit - CENVAT credit - input service
credit availed on product liability insurance service allowed in adjudication, reversed
by Commissioner (Appeals) on Revenue's appeal; and agitated herein.
Held: Tribunal, in the Rotork Control case, dealt with identical issue of denial of credit
on product liability insurance and held the same admissible - in view of this,
applicants have made out a prima facie case for full waiver of pre-deposit of duty
along with interest and penalty. [Para 4, 5]
2015-TIOL-414-CESTAT -DEL
M/s Hindustan Zinc Ltd Vs CCE & ST (Dated : January 5, 2015)
CE - CENVAT - Various items of Iron & Steel and items of Copper and Aluminium used
for various purposes in the manufacturing plant - Prima facie Bench does not agree
with the finding of the Commissioner that credit is not admissible as description of
these items itself shows that their use is not as supporting structures - pre-deposit
waived and stay granted: CESTAT [ para 7]
CENVAT - Structural steel items used for transmission towers for transmission of
electricity from the power plant to the manufacturing plant, credit is admissible:
CESTAT [ para 7]
CENVAT-Aluminium , copper or cathode plates used in the cell house for electrolysis,
credit is admissible: CESTAT
2015-TIOL-413-CESTAT -DEL
CCE Vs Bhandari Deepak Industries Pvt Ltd (Dated : December 4, 2014)
CE - Exemption under Notfn 50/03-CE - When letter of Directorate of Industries,
dated 02.01.2004, acknowledging more than 25% increase in installed capacity of
semi corrugated paper and corrugated boxes was preceded by inspection of the unit
on 26/12/2003, it is absurd to doubt the correctness of this letter - Just because no
additional machinery for manufacture o f corrugated boxes was installed, it cannot be
presumed that there was no enhancement in manufacturing unit's capacity to
manufacture corrugated boxes - For achievement of 25% or more enhancement in
installed capacity for purpose of exemption under said No tfn, it is not necessary that
expansion should be in each and every section of manufacturing plant - Appeal
dismissed: CESTAT [Para 5]
2015-TIOL-410-CESTAT -DEL
M/s AGV Fenestration Pvt Ltd Vs CCE & ST (Dated: December 9, 2014)
CE - When the appellant's unit was located in the area specified in the Notf . No.
50/03 -CE and the goods being manufactured by them was not in the negative list of
the notification, the appellant had nothing to gain by clearing the goods clandestinely
without reporting to the Department -Pre -deposit waived and stay granted: CESTAT
[para 6]
Also see analysis of the Order
2015-TIOL-409-CESTAT -MAD
Sri Bhavani Textiles Processors (P) Ltd Vs CCE (Dated: December 2, 2014)
Central Excise – Stay / dispensation of pre deposit – Applicant is a job worker of CVIL;
they received grey cotton fabrics from CVIL and processed the same under Rule 96D
of erstwhile of Central Excise Rules, 1944 – Revenue viewed that the principal
manufacturer is coating HDPE on the fabrics processed by job worker; confirmed
demands, agitated herein.
Held: on the identical issue, the Tribunal in the case of another job worker, SSM
Processing Mills, granted unconditional stay – in view of that, predeposit of entire
amount of duty along with interest and penalty waived. [Para 1, 2]
2015-TIOL-408-CESTAT -DEL
M/s Ultratech Cement Vs CCE & ST (Dated: January 14, 2015)
CE - CENVAT – It is not disputed that Capital goods have not been received by the
appellant – in this view of the matter, appellant is entitled to take CENVAT credit on
the strength of the Original Triplicate copy of invoices issued by supplier – decision of
P&H High Court in Stelko Strips Ltd. 2010-TIOL-891-HC-P&H-CX relied upon – Appeal
allowed: CESTAT [ para 6]
CENVAT – Input Service – Rule 2(l) of CCR , 2004 – Rent-a-cab service – any services
availed by the manufacturer of excisable goods in the course of business of
manufacturing is to be considered as an Input Service – appellants are entitled to take
credit on Rent-a-cab service – Order set aside and appeal allowed: CESTAT [ para 6]
2015-TIOL-407-CESTAT -DEL
M/s Alpsco Graintech Pvt Ltd Vs CCE & ST (Dated: December 29, 2014)
CE - Classification - Appellant classified "rice bucket elevator" and "rice conveyor"
under heading 8437 as "machinery used in Milling Industry" where the tariff rate is
nil, while department viewed classification under heading 8428, as "other lifting,
handling, loading or unloading machinery" - As per opinion of technical experts, these
machines are specially designed for handling and processing of food grains and that
as per the characteristics of the raw material, component and fabrication techniques
used for manufacture of grain dischargers and grain feeders, these are not fit for
handling heavy and abrasive type material like sand and coal lime - Same imported
machinery are being classifiable by different Customs Houses as milling machinery
under heading 8437 - Goods are correctly classifiable by appellant as milling
machinery under heading 8437 - Stay granted: CESTAT [Para 5]
2015-TIOL-403-CESTAT -MAD
M/s Annur Cotton Mills Vs CCE (Dated: December 1, 2014)
Central Excise – Stay / dispensation of pre deposit – exemption – applicant, a 100%
EOU engaged in the manufacture of Cotton Terry products, paid the duty at the time
of de -bonding and subsequently they claimed the benefit of Notification No.23/2003CE, dated 31.03.2003; denied in adjudication; demand for differential duty conf irmed
and agitated herein.
2015-TIOL-397-CESTAT -KOL
M/s Central Coalfields Ltd Vs CCE & ST (Dated: September 23, 2014)
CE - Redemption fine, Penalty - On ascertaining fact of Central Excise – Demand Applicant is a Govt. of India Undertaking, engaged in the production of Coal which has
been brought under the Central Excise net w.e.f. 01.03.2011 - present demand is
confirmed against them on the ground of shortages detected by internal vigilance /
CBI, adjusted in their stock and reflected in ER-1.
Held: Entire issue relates to demand of duty on the shortages/adjustments recorded
in the ER-1 return for the month of May, 2011 by the Appellant themselves Appellant claims that prior to levy of excise duty, shortages in the stock of Coal was
noticed by their vigilance team and it continued till April, 2011; that on the basis of
second stock verification by their vigilance team, the final shortage figure was
confirmed to be 11.76 lakh M.T. which they have adjusted in their books of accounts
and reported accordingly in their ER-1 return – Adjudicating authority arrived at a
conclusion about removal of the said shortages in sto cks on the basis of their
declaration only - Appellant now produced a copy of CBI report, wherein, inter alia,
discrepancy in the stock was found to be due to excess reporting in the earlier period
by the officers of the Appellant - This fact needs to be s crutinized along with other
evidences on record and the evidences that would be produced by the Appellant appropriate to remit the case to decide the issue afresh taking into consideration the
CBI report and all evidences on record and that would be produced by the Appellant,
after providing reasonable opportunity of hearing. [Para 5]
2015-TIOL-396-CESTAT -MUM
Guardian Castings Pvt Ltd Vs CCE (Dated: November 27, 2014)
CE - Redemption fine, Penalty - On ascertaining fact of clandestine removal of goods,
appellant has paid duty, interest and 25% of duty as penalty - Neither were the goods
available nor cleared under any bond, therefore, redemption fine is not imposable When duty, interest and 25% of duty as penalty has been paid by main assessee
therefore, issuance of SCN and imposition of penalty on co -appellant does not arise –
Appeal allowed: CESTAT [Para 7, 7.2]
2015-TIOL-391-CESTAT -BANG
Regency Ceramics Ltd Vs CCE, ST & C (Dated: September 19, 2014)
Excise - Reversal of credit and remission of duty - Finished goods destroyed due to
industrial violence leading to destruction of factory by fire notwithstanding police
protection granted by High Court - Appellant has done everything to prevent loss to
the factory and property - No negligence attributable - Notwithstanding huge loss to
appellant, Cenvat credit of inputs used in destroyed goods reversed and sought
remission under Rule 21 in reply to SCN - Prima-facie case made out - Pre-deposit is
waived. (Para 3, 4)
2015-TIOL-387-CESTAT -DEL
M/s Indian Hume Pipe Co Ltd Vs CCE & ST (Dated: December 15, 2014)
CE - Merely because the contract terms provided that the price at which the PSC pipes
are to be supplied shall be inclusive of all taxes, it cannot be presumed that the price
also included excise duty – s.11D has to be read with s.12A & 12B of CEA , 1944 demand u/s 11D of CEA , 1944 prima facie not sustainable – Pre -deposit waived and
stay granted: CESTAT [ para 6]
Also see analysis of the Order
2015-TIOL-386-CESTAT -DEL
M/s Johnson Matthey India Pvt Ltd Vs CCE (Dated: January 5, 2015)
CE - Appellant during period of dispute were collecting full amount of sales tax from
customers and were paying only 50% of the same to State Government and were
retaining 50% of tax as per the State Government's Scheme in lieu of capital subsidy
- Point of dis pute is as to whether the amount of sales tax collected by appellant from
customers and retained with them is includible in assessable value or not - Though,
the reasoning given by Commissioner in impugned order for confirming the demand is
confusing - Appellant states that out of total duty demand of Rs. 72,23,683/-, the
duty demand of about Rs. 32 Lakhs is within time - Appellant is directed to deposit am
amount of 32 Lakhs: CESTAT [Para 4]
2015-TIOL-384-CESTAT -MAD
Brakes India Ltd Vs CCE & ST (Dated: September 3, 2014)
Central Excise - CENVAT credit - Stay / dispensation of pre deposit - applicant availed
input services credit on Clearing and Forwarding Services and Courier Services;
denied in adjudication; demands confirmed; upheld by Commissioner (Appeals) and
agitated herein.
Held: Considering the fact that the appellant availed input credit on the C&F services,
which is meant for export of goods and also considering the small amount involved on
courtier services, as well as the Tribunal rulings relied upon; appellant has prima facie
made out a case for waiver of predeposit of dues. [Pa ra 4]
2015-TIOL-378-CESTAT -DEL
U K Paints India Pvt Ltd Vs CC, CE & ST (Dated: June 2, 2014 )
Central Excise - Stay / dispensation of pre deposit - CENVAT credit - input services
credit availed on invalid documents not confirming to Rule 9(1) of CCR 2004 denied in
adjudication, demand for recovery confirmed, upheld by Commissioner (Appeals), and
agitated herein.
Held: force in the submission of appellant that if opportunity of reconciliation is
granted, they would be able to satisfy Commissioner (Appeals); to provide natural
justice, it is necessary that one opportunity is granted - impugned order set aside and
case remanded to Commissioner (Appeals) for decision within three months. [Para 9,
10]
2015-TIOL-377-CESTAT -DEL
CCE Vs Orient Ispat Pvt Ltd (Dated: November 7, 2014 )
CE - As there was nobody representing the respondent, Revenue appeal was disposed
of ex -parte and in Revenue's favour - judgements in favour of respondent could not
be considered - Assessee should not be made to suffer for any failure on the part of
the Advocate - final order recalled - appeal restored to its original number and ROA
application allowed: CESTAT [ para 6, 7]
2015-TIOL-376-CESTAT -DEL
Maruti Suzuki India Ltd Vs CCE (Dated: January 5, 2015 )
CENVAT - Rule 2(l) of CCR , 2004 - Input Service - Visiting Technical personnel of
Suzuki Motors, Japan provided with first class furnished western -style house for stay Outdoor Catering Service and House-keeping services are to be considered as Input
Service - Credit of ST prima facie available - Stay granted: CESTAT [ para 6]
Also see analysis of the Order
2015-TIOL-367-CESTAT -BANG
Supangita Engineer Pvt Ltd Vs CCE, C & ST (Dated: May 12, 2014)
Excise - Cenvat - Irregular availment - Appellant carrying on manufacturing activity in
two units due to space constraint which constituted as one factory - Common
accounting and balance sheets prepared for both the units as one - Availment of
entire CENVAT credit in one unit instead of availing proportionate credit in both the
units - Is totally a revenue neutral situation in as much as the manufacturer is entitled
to Cenvat credit - No specific allegations of willful misstatement or suppression of
facts - Intention to evade duty not attributable more so when credit was reversed as
pointed out - Impugned order confirming imposition of penalty and interest by
invoking extended limitation period, unsustainable as such set aside. (Para 5, 6)
2015-TIOL-365-CESTAT -MAD
M/s Kannappan Iron And Steel Co Pvt Ltd Vs CCE (Dated: September 10,
2014)
Central Excise – Stay / dispe nsation of pre deposit – Valuation – On the dispute
related to valuation of related party clearances, stay order dated 03.07.2014 passed Appellant prays for modification of stay order herein.
Held: issue involved in this case is undervaluation of the goods in so far as the
applicant sold the goods to their two dealers, who are related persons, much lower
than the price of the unrelated persons on the same day - In the present case,
documents placed by the applicant are new evidences, which were not placed before
the Commissioner during the adjudication proceedings at any point of time - such
evidences cannot be accepted in the Application for Modification of the stay order - no
merit in the applicatio n filed by the applicant; however, considering the financial
hardship and the submissions by both sides, the period of compliance is extended for
further six weeks. [Para 4]
2015-TIOL-362-CESTAT -DEL
M/s Shreewood Products Pvt Ltd Vs CCE (Dated: January 14, 2015)
CE - Refund, Interest - s.11B , 11BB of CEA , 1944 - Once the issue of refund and
interest on the same for the period of delay was finally decided by the Commissioner
(Appeals) vide order dated 17.03.2009 and that order was not challenged by the
department, the issue of refund and interest on the same for the period of delay
cannot be re -adjudicated and in this regard, the Asstt . Commissioner's order as well
as Commissioner (Appeals) treating the appellant's reminder letter dated 30.03.2009
as refund application and on this basis, refusing the interest on the ground that the
refund of Rs.88 ,72,686 / - was paid within three months is totally wrong - refund
claim after denovo adjudication in pursuance of Tribunal's order had been filed u/s
11B and, therefore, interest for period of delay is to be considered only under s.11 BB
- judgment of Apex Court in ITC Ltd. - 2004-TIOL-112-SC-C X-LB is not applicable Department is directed to pay interest on refund to the appellant u/s 11 BB of the CEA
, 1944 from the date, immediately after expiry of three months from the date of filing
of refund claim on 21/10/08 - Appeal allowed: CESTAT [ para 6]
2015-TIOL-356-CESTAT -MUM
Amrut Bhagini Mandal (Trading Unit) Vs CCE (Dated: January 14, 2015)
CE - Manufacture - s.2(f) of CEA, 1944 - Duty paid PVC sleeves cut into horizontal
pieces and subjected to heat treatment to form sealing sleeve for the purpose of
shrink wrap - Process amounts to manufacture as a new commodity with different
name, character and use emerged and CE duty is payable: CESTAT [para 5, 5.1, 5.2]
Also see analysis of the Order
2015-TIOL-353-CESTAT -MUM
M/s Mukand Ltd Vs CCE (Dated: October 29, 2014)
CENVAT - Credit availed on inputs - Appellant was sending semi processed inputs for
carrying out some process to different job workers - Said inputs after being processed
were returned back to appellant - It was alleged that appellant have not received back
quantity of waste and scrap from job-workers, which amounts to clearance of waste
and scrap without payment of duty – Held: Waste and scrap are not manufactured
goods irrespecive of whether they are generated at premises of principal manufacturer
or at premises of job -worker - legislature has consciously not made any provisions for
reversal of any credit taken on duty paid inputs in case of clearance of waste and
scrap and/or, their non-return from job worker's premises under CER, 2002 read with
CCR, 2002/2004 - Impugned order set aside and appeal allowed: CESTAT [Para 3, 6]
2015-TIOL-350-CESTAT -DEL
M/s JCT Ltd Vs CCE (Dated: December 24, 2014)
CE -appellant is entitled for interest on delayed refund for the period after three
months from the date of order passed by the Tribunal till sanction of the refund:
CESTAT [para 7]
2015-TIOL-335-CESTAT -MUM
Shri Ritesh Jain Vs CCE (Dated: February 24, 2014)
CE - Penalty - P rimary requirement of Rule 26 is that the goods should be held liable
to confiscation and the person should be aware that the goods are liable to
confiscation - In the adjudication order, there is no finding given by the adjudicating
authority in respect of liability of confiscation of the goods - In the absence of such a
finding, imposition of penalty under Rule 26 cannot be sustained - Pre-deposit waived
&Stay granted : CESTAT [para 5.1, 5.2]
2015-TIOL-332-CESTAT -AHM
M/s Rapicut Carbides Ltd Vs CCE & ST (Dated: November 12, 2014)
CE - Rule 57-I of CER, 1944 - Second round of litigation - In first round this Tribunal
remanded the case back to Adjudicating authority to pass the order on limitations
claimed by appellant - Adjudicating authority has held that mere 'Suppression of facts'
on the part of appellant is sufficient to invoke extended period of 5 years under
provisions of Rule 57-I of CER, 1944 - Aggrieved, hence appeal - Words "suppression
of facts', used in said Rule are in the company of words like collusion and wilful mis statement and will have to be understood to mean 'with intent to evade payment of
duty' - Observations made by Adjudicating authority that 'no intention to evade' is
required for invoking extended period of 5 years, can not thus be appreciated as
correct interpretation of law - Though there is no dispute that provisions of Section
11A of CEA, 1944 are independent of recovery machinery under said Rule of CER, but
the ratio of words 'suppression of facts' and 'wilful' as interpreted by Apex Court will
also be applicable to recovery provisions of said Rule - Appellant is not agitating the
issue of admissibility of credit but there is no evidence on record that there was any
deliberate act on part of appellant to avail inadmissible credit - extended period of 5
years can not be invoked for not following the procedure properly when otherwise the
credit was admissible - Period of demand is from January 1990 to December 1990 and
SCN is issued on 11.11.1994 and is clearly time barred under said Rule - Appeal
allowed: CESTAT [Para 2, 4.3, 5, 6, 7]
2015-TIOL-325-CESTAT -DEL
M/s Ultratech Cement Ltd Vs CCE (Dated: March 12, 2014)
Central Excise - CENVAT credit - appellants engaged in the manufacture of white
cement and putty, availed credit on the basis of four invoices issued by M/s.
Rishabhdev Techno Cables Ltd., who were established by investigation to have not
discharged the same - Revenue viewed the credit inadmissible at appellant's end,
adjudicated demand with interest and penalty, agitated herein.
2015-TIOL-324-CESTAT -MAD
M/s NS Rama Rao Body Works Vs CCE (Dated: November 20, 2014)
Central Excise - Classification - Stay / dispensation of pre deposit - applicants are
engaged in the manufacture of steel bins and classified it under CSH 8705 90 00 of
CETA, 1985 - After investigation by the DGCEI, Revenue viewed that the goods would
be classified under sub-heading 7309 00 90 - demands adjudicated and agitated
herein.
2015-TIOL-323-CESTAT -MAD
Rajshree Sugars And Chemicals Ltd Vs CCE (Dated: November 20, 2014)
Central Excise – Captive Consumption - appellants are engaged in the manufacture of
Sugar & Molasses (by product) in the sugar plant, Electricity in the co -generation
plant and Ethyl Alcohol in various forms (both dutiable and exempted) in the distillery
plant; all situated within the same premises and availed credit on inputs and capital
goods - benefit of Notification No.67/95-CE dated 16.3.1995 claimed in respect of
clearance of the molasses captively used in the manufacture of various dutiable and
exempted final products - procedure under Rule 6(3)(i) & (ii) of CENVAT Credit Rules,
2004 adhered to and amount of 6% / 10% of value of exempted goods paid at the
time of clearance – Revenue viewed that after re-structuring of Cen tral Excise Tariff
from 6 Digit to 8 Digit with effect from 1.3.2005, the un-denatured Ethyl Alcohol was
removed from 8 Digit Central Excise Tariff and Sub -heading 2207 2000 carries only
spirits and Ethyl Alcohol denatured of any strength; that Rectified Spirit and ENA are
non-excisable goods with effect from 1.3.2005 and therefore, the appellants are not
eligible to avail benefit of exemption Notification No. 67/95-CE on Molasses captively
used in the manufacture of Rectified Spirit and ENA - duty on the molasses captively
consumed in their manufacture, denying the benefit of Notification No.67/95-CE
demanded in all cases with interest and penalty; CENVAT credit availed on the
molasses purchased from outside denied in two cases and credit availed in cogene ration plant used in manufacture of exempted goods denied in one case;
commonly agitated herein.
2015-TIOL-322-CESTAT -MUM
CCE Vs Ambika Waste Management (P) Ltd (Dated: December 12, 2014)
CE - Maintainability of appeal - Amount involved in dispute is Rs.1.62 lakh - As per
new litigation policy, Government of India has laid down that no appeals should be
filed by Revenue before the Tribunal in which the amount involved is less than Rs.2
lakhs - Appeal dismissed: CESTAT [Para 4, 5]
2015-TIOL-318-CESTAT -MUM
CCE Vs M/s Jay Iron & Steel Industries Ltd (Dated: December 12, 2014)
CE – CENVAT credit – Supply of scrap by dealers – allegation that dealers have not
supplied any scrap but only issued invoices – investigation is silent as to how the
respondents man ufactured finished material without receiving inputs – law is settled
that as long as duty payment is accepted on output, benefit of credit is not deniable –
Benefit of CENVAT Credit, being substantial benefit granted by law, it cannot be
denied on flimsy ground like, suspicion or presumption, as the same cannot take the
place of proof - Revenue appeals dismissed: CESTAT
Also see analysis of the Order
2015-TIOL-317-CESTAT -AHM
M/s Colius Paper Converters Vs CCE (Dated: October 27, 2014)
Central Excise – Offence case - M/s Colius was visited by officers, and investigation
launched – it was observed that the main appellant had issued 4 parallel invoices
without discharging duty; maintained parallel RG-1 register up to Dec 2006; and
cleared the finished goods clandestinely without payment of duty – after Dec 2006,
entire production was cleared to M/s Maple – demands adjudicated for clandestine
clearances and penalties imposed on the firms and individuals agitated herein.
2015-TIOL-316-CESTAT -BANG
M/s Mann And Hummel Filter Pvt Ltd Vs CCE & ST (Dated: December 3, 2014)
Excise – Cenvat – Credit on input services used are common to both manufacturing
and trading activities – Demand for reversal of proportionate credit attributable to
trading activity – Commissioner (A) allowed credit as admissible based on prevailing
precedent holding that trading is not an exempted service – Wrong availm ent of credit
by appellant with intention to evade tax hence not attributable – Prima-facie case in
favour of assessee – Pre -deposit waived. (Para 4)
2015-TIOL-315-CESTAT -MUM
M/s TK Warana SSK Ltd Vs CCE (Dated: August 5, 2014)
CENVAT - Appellant availed Credit of inputs and input services for purpose of
manufacture and removal of goods - Credit of services availed by manufacturer is
available from place of removal, which herein is railway station, on goods which have
been sold on FOR basis and Port when goods sold at FOB basis - conditions specified
in Circular 97/8/07 were satisfied by appellant – As per Inductotherm India Pvt. Ltd .,
in case of export of Cargo Handling Services, ST paid thereon is available as input
services, as in such case, place of removal is Port - appellant is entitled to CENVAT
Credit on transportation charges/freight which is incurred for removal of goods till
railway sta tion (on FOR basis) or the Port - impugned order set aside and appeal
allowed: CESTAT [Para 2, 6, 6.1]
2015-TIOL-311-CESTAT -MAD
Akas Medical Vs CCE (Dated: November 11, 2014)
Central Excise - Stay / dispensation of pre deposit - SSI exemption - appellant,
engaged in the manufacture of Sight testing instruments bearing the brand name
"AKAS" as well as trading of indigenously procured and imported medical equipments;
availed SSI exemption under Notification No.8/2003 dt. 1.3.2003 - exemption denied
on the ground that the brand name "AKAS" is owned by M/s. Akas Medical Equipment,
Trichy, a different entity - demands adjudicated; Commissioner (Appeals) dismissed
their first-stage appeal for non compliance with stay order; now agitated herein.
2015-TIOL-309-CESTAT -BANG
Hindalco Industries Ltd Vs CCE (Dated: January 22, 2015)
CE - Interest - Appellantsavailing CENVAT credit of Rs.14.53 lakhs on the materials
rejected by the customers and returned to the factory for refining, reprocessing, etc. Revenue taking a view that the conditions laid down under Rule 16 of Central Excise
Rules have not been fulfilled and as a result, the demand for duty of Rs.13.94 lakhs
being the credit involved was confirmed with interest - Tribunal directing appellant to
deposit 50% of the amount as pre -deposit and later vide Final Order dated 24.2.2005
rejecting appeal - appellant paying balance dues with interest and later filing an
appeal before Kerala High Court who in their judgment dated 24.1.2008 held the
appellant eligible for the credit and allowed the appeal - thereafter appellant filing a
refund claim for Rs.14,74,012/- paid in cash by them comprising of inadmissible credit
of Rs.6,96,710/- and interest of Rs.7,77,302/- - lower authorities holding as
admissible the amounts paid, however, appellant before CESTATseeking payment of
interest on the interest amount paid by them.
Held: Interest was added to the duty in Section 11B in May 2008 - However, the
Parliament did not consider it appropriate that the word interest should be added in
Section 11BB also - If interestwas also to be added in Section 11BB while providing
for payment of interest on duty, the claim of the appellant could have been sustained
- When the statute does not provide for payment of interest while sanctioning the
refund of interest on duty, the Tribunal has no power to order refund of interest on
interest being creation of the statute - Appeal has no merit, hence rejected: CESTAT
[para 6.1, 7]
2015-TIOL-303-CESTAT -MUM
CCE Vs Emerson Network Power (I) Ltd (Dated: December 26, 2014)
CE - Valuation - s.4 r/w Rule 5 of Central Excise Valuation (Dete rmination of Price of
Excisable Goods) Rules, 2000 - Revenue alleging that assessee had collected
additional amounts as transportation charges by raising various debit notes but not
indicating said amounts on invoice - Nothing on record to show that amounts collected
were not freight charges but something else - It also transpires that assessee had
collected only an amount, which is freight paid by them to the transporters and raised
a debit note separately - amounts not included in AV - Impugned order dropping
demand is correct and does not suffer from any infirmity - Revenue appeal rejected:
CESTAT [Para 3, 4]
2015-TIOL-302-CESTAT -AHM
M/s Saga Laboratories Vs CCE (Dated: September 30, 2014)
Central Excise - Extension of Stay - extension earlier granted was agitated by
Revenue before HC who ruled that in terms of the Apex Court ruling in the Kumar
Cotton Mills case, CESTAT has the powers to extend the stay beyond the period of 365
days under the provisions of Section 35C (2A) of the Central Excise Act, 1944; and
remitted the case to the Tribunal for passing a speaking order / reasoned o rder
considering 3rd proviso to section 35C(2A) of the Central Excise Act, 1944 - taken up
herein.
2015-TIOL-301-CESTAT -MAD
M/s Bayforge Ltd Vs CCE (D ated: November 5, 2014)
Central Excise - CENVAT credit - Stay / dispensation of pre deposit - appellant availed
input services credit under Rule 2(l) of CCR 2004 on services like Insurance Services,
Corporate Membership Services, Payroll Services, Photocopier Services and Travel
Agency Services; denied in adjudication, demand for recovery confirmed with interest
and penalty and agitated herein.
2015-TIOL-300-CESTAT -DEL
M/s Atmasco (P) Ltd Vs CCE & C (Dated: November 27, 2014)
Central Excise - Exemption - Appellant manufactured various boiler parts and cleared
the same to Mega Power Project, claiming exemption under notification No.12/2 012CE, viewed by Revenue as inadmissible on the grounds that the parts manufactured
by the appellant are general fabrication structures, which are not specified in the
notification in question, either as parts or components of any machinery - demands
adjudicated and agitated herein.
2015-TIOL-297-CESTAT -AHM
Mahavir Castings Pvt Ltd Vs CCE, C & ST (Dated: December 17, 2014)
CE - Tribunal directed the applicant to pre -deposit the entire amount of duty and to
report compliance - Applicant deposited the entire amount of duty as per stay order
and also enclosed TR -6 challan but by Final order Tribunal dismissed appeal for noncompliance of the stay order - later application filed for Restoration of Appeal but
Registry wrongly treated the same as an application for extension of stay and Tribunal
granted extension of stay - there is no fault on the part of the appellant - Order
dismissing the appeal recalled and appeal fixed for hearing: CESTAT [ para 5, 6]
2015-TIOL-292-CESTAT -MAD
Panasonic Appliances India Co Ltd Vs CCE (Dated: No vember 5, 2014)
Central Excise - CENVAT credit - Stay / dispensation of pre deposit - adjudicating
authority denied credit on Outdoor Catering Services and Clearing & Forwarding
services; Commissioner (Appeals) upheld the adjudication order, now agitated herein.
2015-TIOL-291-CESTAT -MAD
Pepsico India Holdings (P) Ltd Vs CCE (Dated: November 5, 2014)
Central Excise - Demand - Stay / dispensation of pre deposit - appellants are
manufacturing aerated water; adjudicating authority demanded duty on breakages of
bottles while handling - Commissioner (Appeals) upheld the demand, agitated herein.
2015-TIOL-290-CESTAT -MAD
Sundaram Fasteners Ltd Vs CCE (Dated: November 5, 2014)
Central Excise - MODVAT credit - Stay / dispensation of pre deposit - appellant,
manufacturers of bolts, buts and screws, availed modvat credit on the inputs used in
the manufacture of final product as a job worker and cleared the goods to Principal
manufacturer under Notification No.214/86-CE - Revenue viewed the credit
inadmissible; adjudicated demands with interest and penalty; agitated herein.
2015-TIOL-289-CESTAT -AHM
M/s Gautam Paper Udyog Vs CCE (Dated: November 25, 2014)
CE - appellant submits that the process conducted by them does not amount to
manufacture whereas it is the contention of the Revenue that the activity is
"manufacture" & the product would get covered under the category of boxes or
cartons Heading 4819 2070 and or 4819 2090 - There is an element of the doubt as
to the correct classification of the product and such classification can be considered by
Bench only at the time of final disposal of appeals - Pre -deposit ordered of Rs.10
lakhs: CESTAT [ para 6]
2015-TIOL-284-CESTAT -MUM
CCE Vs Navneet Publications (I) Ltd (Dated: January 14, 2015)
CE - Mere cutting and slitting of paper roll and conversion into foolscap sheets does
not change the identity of the paper – activity is not manufacture u/s 2(f) of CEA,
1944 – much water has flown on the subject matter – Revenue appeal dismissed:
CESTAT [para 5, 6]
Also see analysis of the Order
2015-TIOL-283-CESTAT -MUM
Ranbir Sharma Vs CCE (Dated: August 13, 2014)
CE – Valuation - appellant is an independent textile processor and undertakes
processing of fabrics on job work basis for merchant manufacturers - appellants
paying duty on jo b charges plus 15% towards notional profit as per Trade Notice No.
20/2001 which was not required to be paid - If 15% notional profit is excluded then
appellant have paid excess duty which is required to be adjusted against charges of
additional processing such as rotary, peaching or zero zero etc., then duty demand
would not be there – appellant entitled for availing deemed credit as per notfn 6/2002
– In respect of goods cleared for home consumption deemed credit cannot be denied
on inputs when duty is pa id on final products - The adjustment of 15% notional credit
has also not been done in case of exports and it cannot be held that export
consignments were over-valued - As extended period of limitation is not invokable,
consequently demand of duty is not s ustainable – Therefore deemed credit correctly
availed – impugned order set aside and appeal allowed: CESTAT [Para 2, 5, 6]
2015-TIOL-282-CESTAT -MAD
Supreme Petrochem Ltd Vs CCE (Dated: November 3, 2014)
Central Excise – Stay/Dispensation of pre -deposit - CENVAT Credit of Service Tax paid
on outward transport – As seen from the purchase orders and the copies of the
invoices submitted by the appellant along with appeal papers and the contract, it is
stated that "door delivery" to the buyers premises - The appellants have discharged
duty on the total value of the goods inclusive of freight and insurance - Considering
the decisions of High Court and the Tribunal, prima facie the appellants have made
out a case for waiver of predeposit and stay - Pre-deposit waived and recovery is
stayed till the disposal of the appeals. (para 4)
2015-TIOL-279-CESTAT -MUM
CCE Vs Saroj Engineers (Dated: October 31, 2014)
CE - Respondents availed CENVAT credit on supplementary invoices issued by job
workers - job workers have not suppressed the facts and allegation of suppression
was discharged - when complete finding is on record and nothing contrary has been
proved by Revenue, impugned order has no infirmity so upheld - appeal filed by
Revenue is dismissed: CESTAT [Para 2, 7]
2015-TIOL-278-CESTAT -BANG
Page Industries Ltd Vs ST (Dated: November 12, 2014)
Excise - Cenvat - Availment of credit based on invoices addressed to head office and
goods received at job worker's premises - Credit not properly accounted for alleged Appellant willing to show that the goods have been received, utilized and finished
goods have been manufactured and duty has also been paid and pleaded to release
documents seized to substantiate his case - Further, appellant disputed the denial of
Cenvat credit on certain amounts though clearly admissible - On facts, matter
remanded to original authority to consider afresh as observed on supplying documents
necessary to appellant. (Para 2, 3)
2015-TIOL-275-CESTAT -DEL
M/s Kaakteeya Fabs Pvt Ltd Vs CCE & ST (Dated: November 21, 2014)
Central Excise – Stay / dispensation of pre deposit – Manufacture - Appellant 2
entered into a turnkey contract with NTPC and subcontracted a portion to Appellant 1,
whose scope covered fabrication and erection of CW liners and pipes from steel
supplied by Appellant 2; who discharged service tax on entire contract value Revenue viewed that Appellant 1 was undertaking the manufacture of pipes a nd was
not discharging the Central Excise duty liability; demands adjudicated with penalty on
both firms, and agitated herein.
2015-TIOL-269-CESTAT -MUM
CCE Vs Balmer Lawrie And Co Ltd (Dated: October 31, 2014)
CENVAT - shortage of raw materials during stock taking – credit taken sought to be
recovered – Credit admissibility is dependent on various factors to see whether entire
consignment is received in factory or was diverted – so also tolerance for hygroscopic,
volatile and such other cargo has to be allowed as per industry norms excluding
unreasonable or exorbitant claims - marginal variation due to weighment by different
machines is also to be ignored if within tolerable limits – stock of lubricating oil is
measured by way of dip method and which shows variance due to temperature and
density - no infirmity in the order of Commissioner(A) allowing credit – Revenue
appeal dismissed: CESTAT [Para 4, 8]
2015-TIOL-268-CESTAT -MUM
M/s Varun Impex Vs CCE (Dated: September 22, 2014)
CE - Availment of CENVAT Credit on basis of fake and bogus input invoices - It was
alleged that Singh Inc. had cleared 4 consignments to appellant - In all CE invoices
delivery mode was indicated as Ex-factory - Vide impugned O -I-O, Commissioner has
imposed penalties, recording the finding that since the noticee was not a
manufacturer so cannot evade CE duty, penalty under Section 11AC of CEA, 1944 was
rightly not imposed, but it does not automatically mean that penalty under Rule 26 of
CER, 2002 is not imposable - Appellant claims that transactions were paper
transactions, there were no goods liable for confiscation and, therefore, penalty under
said rule cannot be imposed without confiscation - Held: Being second round of
litigation and in view of amendment made under Section 35F of CEA, 1944, appellants
are directed to deposit an amount of 7.5% of penalty imposed on them: CESTAT [Para
3, 6]
2015-TIOL-267-CEST AT-MAD
M/s Tamil Nadu Newsprint And Papers Ltd Vs CCE (Dated: September 5,
2014)
Central Excise - CENVAT credit - appellants are manufacturers of Printing & Writing
Paper and Newsprint, availing Cenvat credit on welding electrodes used in their
manufacturing plant for repairs and maintenance of plant and machinery for the
manufacture of excisable goods - Revenue viewed the same inadmissible, confirmed
demands in adjudication, upheld by Commissioner (Appeals) and agitated herein.
He ld: issue of admissibility of cenvat credit on the welding electrodes used for repair
and maintenance of plant and machinery has been agitated before the Apex Court,
various High Courts and Tribunal - Tribunal's Order No. 1300/2011 dated 13.12.2011
passed by relying on the ruling in the case of SAIL Vs. CCE, Ranchi which in turn has
been clearly distinguished by the High Court of Chhattisgarh in the case of Ambuja
Cement Eastern Ltd. [Para 6]
Madras HC in the case of CCE, Trichy Vs. India Cements Ltd. on the identical issue has
upheld Tribunals order in holding that the welding electrodes used for repair and
maintenance are covered under the definition of capital goods; same was relied by the
Tribunal in the appellant's own case in Final Order No. 721/2010 dated 01.07.2010 similar view taken by Principal bench of Tribunal in Kisan Co-operative Sugar Factory
Ltd., holding that when three high courts ruled that welding electrodes used for repair
and maintenance of plant and machinery are eligible for Cenvat credit, it is these
judgments which will hold the field - Following Madras HC ruling and Kisan Cooperative decisions, appellants held eligible for the credit availed on the welding
electrodes used for repair and maintenance - impugned order set aside. [Pa ra 7, 8]
2015-TIOL-266-CESTAT -KOL
M/s Mars Mercantile Pvt Ltd Vs CCE & ST (Dated: October 9, 2014)
CE - Demand is for the period April, 2009 to March, 2010 - As per order of this
Tribunal No.S-83/KOL/2012 dated 08.02.2012, pre-deposit of dues waived and stay
granted: CESTAT [Para 2]
2015-TIOL-264-CESTAT -MUM
CCE Vs Yashwant Industries Works Pvt Ltd (Dated: August 20, 2014)
CE - Superseal Mastic Epoxy Putty manufactured & sold under brand name Feviseal
Easimix– duty paid @16% on the invoice/selling price - Revenue view that same is
classifiable under CH 3214.00 and assessable u/s 4A of CEA, 1944 – lower authorities
holding in favour of assessee, hence Revenue in appeal. HELD: Chemical Examiner's
report classified the product as "Other Mastics" Ch.3214 - "Other Mastics" have been
excluded for levy of duty u/s 4A of CEA – goods rightly valued u/s 4 on transaction
value - Revenue appeal dismissed : CESTAT [para 4, 5]
2015-TIOL-262-CESTAT -DEL
M/s P and P Overseas Vs CCE (Dated: October 29, 2014)
Central Excise – Refund – Appellant, a 100% EOU, filed claims for cash refund of the
accumulated Cenvat credit under Rule 5 of the Cenvat Credit Rules, 2004 – Claim
partially denied in adjudication to the extent of Cenvat credit taken in respect of CHA
services availed for export of the goods and courier services used in connection with
the manufacturing business of the appellant – It was viewed that the CHA services
and courier services are not eligible for Cenvat credit and secondly the export
proceeds have not been received by the appellant – Commissioner (Appeals) upheld
the same, now agitated herein.
2015-TIOL-260-CESTAT -KOL
M/s Saraf Metal Works Vs CCE (Dated: July 14, 2014)
Central Excise – Stay / dispensation of pre deposit – Demand – clandestine clearance
of aluminium wires alleged on the basis of kachcha receipts, demands confirmed with
penalties on firm and individuals agitated in the first round of litigation was remanded
for de novo consideration, reconfirmed, and now agitated in the second round of
litigation.
2015-TIOL-259-CESTAT -MUM
CCE Vs Sharp Batteries & Allies Inds Ltd (Dated: November 14, 2014)
CE - Respondent cleared goods to customers from godown - whether transportation
charges being paid for transportation of goods from factory to godown is includable in
AV – Commissioner(A) dropping demand – Revenue in appeal before CESTAT. Held: It
is immaterial whomsoever has paid transportation charges, same are includable in AV
- Respondent has raised issue of limitation but while filing their price list, they have
not stated the facts to department, therefore, extended period was rightly invoked by
Revenue - Matter remanded: CESTAT [Para 8, 9]
2015-TIOL-254-CESTAT -MUM
M/s Soma Papers & Industries Ltd Vs CCE (Dated: October 22, 2014)
CE - Valuation - s.4 of CEA, 1944 - Whether transportation charges of inputs is
required to be added in A.V. where appellant is manufacturing goods on job -work
basis. Held: Cost of inputs will not only be the charges on which such goods have
been purchased but also includes transportation cost upto job-worker's place - No
infirmity in impugned order so appeal dismissed: CESTAT [Para 2, 5]
2015-TIOL-251-CESTAT -DEL
M/s Rollatainers Ltd Vs CCE (Dated: November 24, 2014)
CE – Classification of packing machines used for packing of various dairy products –
Appellants, prior to introduction of the notification 6/2006 -CE were classifying the
goods under heading 84.22 and it is only upon the introduction of the notification,
they switched classification to 84.34 for machines supplied to dairy owners & claimed
exemption - Thereafter they continued to adopt two different classifications for the
same very product, dependent upon the purchaser of the said goods – Revenue
alleging that in view of SC decision in HMT Ltd. 2007-TIOL-132-SC-CX goods correctly
classifiable under SH 84.22 & duty payable & confirmed – Appeal to CESTAT. Held: An
assessee who is working under Central Excise is expected to be in knowledge of the
basic fact that one product cannot be held to be falli ng under two different headings
and cannot be allowed to adopt two different classifications – In view of the
insufficient description of the goods in the monthly/quarterly returns, read with the
fact of shifting of classification, with the introduction of the notification, leads one to
believe, at the prima facie stage that this was done with an intention to claim the nonavailable benefit of Notification No. 6/06-CE and as a modus operandi – Pre -deposit
ordered of 12 lakhs in addition to Rs.3 lakhs paid a lready: CESTAT [ para 6, 7]
2015-TIOL-250-CESTAT -MUM
CCE Vs Universal Enterprises (Dated: March 14, 2014)
CE – Assessee undertakes the activity of cutting to shape of plastic films and sheets
as per customer's requirements - Merely cutting a sheet or film into required shape or
size does not result in bringing into existence any new product – Therefore, the
activity undertaken by them did not amount to "manufacture" – no infirmity in
impugned order – Revenue's appeal dismissed as devoid of merits: CESTAT [Para 6.1,
7]
2015-TIOL-249-CESTAT -MUM
Badve Engg Ltd Vs CCE (Dated: November 27, 2014)
CENVAT - Admin Housekeeping services, Crane services, Electrification services,
Valuation of plot service etc. - As per Rule 2(l) of CCR, 2004 and Ultratech Cement Ltd
. – 2010-TIOL-686-HC-MUM-ST , said services are to be considered as Input Services
since being used d uring course of manufacturing of goods - Appellant is entitled to
take CENVAT credit - Appeal allowed: CESTAT [Para 2, 6]
2015-TIOL-245-CESTAT -DEL
Uflex Ltd Vs CCE & C (Dated: October 24, 2014)
CE - Refund - whether transport charges incurred by appellants in transporting and
delivering the goods upto buyers' premises are includible in AV - Sale is on FOR
destination basis and destination is buyer's premises - Place of removal, as per
definition in section 4 of CEA, 1944 becomes the buyers premises, as that is the place
from where excisable goods were sold after clearance from the factory from where
such goods were removed - Appellants rightly included the cost of transportation in
AV - Duty was correctly paid and hence the impugned refund correctly taken - As the
assessee succeeds on merits, dwelling on the issue of time bar is avoided - Appeals
allowed: CESTAT [Para 4, 5, 6]
2015-TIOL-241-CESTAT -DEL
M/s Prism Cement Ltd Vs CCE (Dated: October 13, 2014)
CE - S.No.1C of Notfn 4/2006-CE - Appellant exported cement in 50 kg. bags to Nepal
on payment of duty leviable as per said notfn - Third proviso to entry No.1C shows
that where retail sale price of goods is not required to be declared under Standards of
Weights and Measures (Packaged Commodities) Rules, 1977 and thus not declare d,
the duty is to be determined as is in the case of goods cleared in other than packaged
form - Even Revenue is not disputing the fact that RSP is not required to be declared
on cement bags exported to Nepal and no such MRP was declared either - As per
Jaypee Bela Plant appellant entitled to benefit they claimed - Appeal allowed: CESTAT
[Para 2, 5, 7]
2015-TIOL-240-CESTAT -AHM
M/s Tata Chemicals Ltd Vs CCE (Dated: December 22, 2014)
Central Excise – Interest on delayed refund – Refund initially rejected, but allowed
by the CESTAT – Interest claim under Section 11BB rejected on the ground that
refund was sanctioned within three months from the date of order of the Tribunal and
hence no delay.
2015-TIOL-239-CESTAT -MAD
M/s Honda Motor India Pvt Ltd Vs CCE (Dated: October 15, 2014)
Central Excise – Stay/Dispensation of pre -deposit - Manufacture – Section 2(f) Repacking, relabeling of automobile spare parts imported – Appellants paid duty on
MRP basis by treating the process as amounting to manufacture by availing CEVNAT
Credit – Revenue denied credit on the ground that the appellant is not entitled for
CENVAT Credit as the manufacturing activity had been completed at the port itself –
Held: Prima facie, there is inspection, repacking and relabeling of the container from
unit to unit container or bulk to unit container - There is repacking of such goods in
container and covered within the definition of "manufacture" under Section 2(f) of the
Act, 1944 – Appellant has a strong prima facie case for waiver of pre-deposit – Pre deposit waived. ( para 9 & 10)
2015-TIOL-236-CESTAT -DEL
M/s A B Excavators And Earthmovers (P) Ltd Vs CCE (Dated: September 15,
2014)
Central Excise - Stay / Dispensation of pre deposit - Classification - Appellants sought
to classify ‘Backhoe' attached to tractor, under CH 84322990 as essentially meant for
agricultural/allied purposes while Revenue sought to classify it under CH 84.31 demands adjudicated, upheld by Commissioner (Appeals) and agitated herein.
2015-TIOL-233-CESTAT -DEL
M/s Winsome Yarns Ltd Vs CCE & ST (Dated: January 2, 2015)
CE - When two exemption Notifications are available to an assessee , he can always
opt for the one which is most beneficial for him and in this regard the Department can
not force the assessee to avail a particular exemption Notification -CENVAT credit has
been rightly taken on capital goods -no cause for denial of credit by forcing assessee
to avail exemption - Appeal allowed: CESTAT
Also see analysis of the Order
2015-TIOL-232-CESTAT -MAD
M/s ELAC Marketing Pvt Ltd Vs CCE (Dated: September 15, 2014)
Central Excise – Stay/dispensation of pre deposit – SSI exemption - applicants are
engaged in the manufacture of 'Instant Water Heaters and Automatic Storage Water
Heaters' cleared under the brand name of 'Elac Excel'; however availed exemption
under Notification No. 8/2003-CE (NT) dated 1.3.2003 – Revenue viewed SSI
exemption inadmissible, adjudicated demands with interest and penalties on firm and
individual, agitated herein.
2015-TIOL-231-CESTAT -MAD
M/s Dynamatic Technologies Ltd Vs CCE(Dated: December 8, 2014)
Central Excise – suo moto credit - applicants erroneously paid the excise duty on
supplementary sales invoices which were subsequently cancelled, and they have
availed re -credit of excess duty erroneously paid by them – Revenue viewed the same
irregular, and confirmed demand of the same with interest and penalty –
Commissioner (Appeals) ordered pre deposit which was not complied with, and
dismissed their appeal in an ex parte order; same agitated herein.
2015-TIOL-227-CESTAT -DEL
M/s Hindustan Zinc Ltd Vs CCE & ST (Dated: January 2, 2015)
CENVAT - Credit is not admissible on inputs that are attributable to the electricity
produced in captive power plant and sold to Ajmer Vidyut Vitran Nigam Ltd - Penalty
imposable as facts came to knowledge only upon investigation - as for electricity
supplied to sister unit - credit not deniable: CESTAT [ para 3, 4]
Also see analysis of the Order
2015-TIOL-223-CESTAT -BANG
Rajhans Enterprises Vs CCE, C & ST (Dated: December 1, 2014)
Excise – Remand – Appellant is similarly circumstanced amongst others whose
appeals against penalties have been remanded to original authority without insisting
for pre-deposit – Following same, impugned order set aside and matter remanded.
2015-TIOL-222-CESTAT -AHM
M/s Sunfield Ceramic Vs CCE & ST (Dated: November 24, 2014)
Central Excise - Limitation - first appellate authority has not decided the issue on
merits but has decided the case on time bar in filing the appeal before him - appellant
contends that the order-in-original No. 34/ADC/2013 dated 28.2.2013 passed by the
Adjudicating authority was not received by the appellants and was only received on
21.11.2013 and thus appeals were filed in time as held in a catena of rulings cited in
defence.
2015-TIOL-221-CESTAT -MAD
Naachiar Paper Boards Private Ltd Vs CCE (Dated: September 22, 2014)
Central Excise - Stay / dispensation of pre deposit - Exemption - applicants are
engaged in the manufacture of "White Duplex Board" and availed benefit of
Notification No.4/2006-CE dt. 1.3.2006 (Serial No.91) as amended - Revenue viewed
that the appropriate Sl.No. was 90, and that Sec 5A(1A) of the CEA 1944 was
contravened.
2015-TIOL-214-CESTAT -DEL
Mint Port Pvt Ltd Vs CCE & ST (Dated: July 14, 2014)
Central Excise – Condonation of delay - appellant's contention is that as the impugned
order dated 30.8.2011 was never received by them and it is only when the Revenue
approached them for recovery, they procured the order from the Department on
25.9.2012 and filed the present appeal in December, 2012.
2015-TIOL-213-CESTAT -DEL
Studio Printall Pvt Ltd Vs CCE (Dated: September 25, 2014)
CE - Notfn . 108/95-CE - clearance of goods to UNICEF - for granting exemption, only
a certificate from the UN body to the effect that it is for official use is sufficient and no
approval by Government of India is stipulated - it is also immaterial that the
certificate in question did not mention exemption from Central Excise duty even
though it mentioned sales tax/ octroi etc . - benefit of notfn . 108/95 -CE available matter remanded to Commissioner: CESTAT [ para 4, 5, 6 ]
2015-TIOL-206-CESTAT -MAD
Paramount Mills Pvt Ltd Vs CCE (Dated: July 10, 2014)
Central Excise - Demand of duty on account of clandestine removal of Denim Fabrics
manufactured by the appellants - Matter remanded by the High Court to Tribunal to
examine the issue of limitation in the light of documents submitted by the appellants Held: The veracity of these documents need to be verified along with the original
records available with the department so as to arrive at a conclusion whether there is
any suppression of facts or extended period can be invoked in this case for demanding
duty or whether there is wilful suppression of facts - The original authority should
verify the original documents, and also to take into consideration the directions of the
High Court and examine the issue in the light of the above directions and pass fresh
orders on the duty confirmed by invoking extended period under proviso to Section 11
AC of the Act - Impugned order in so far as that portion of order confirming the duty
demand and imposition of penalty on the appellants is set aside and matter remanded
to the Original Authority.
2015-TIOL-205-CESTAT -MAD
M/s Saradha Terry Products Ltd Vs CCE (Dated: December 2, 2014)
Central Excise – Appellant firm, a 100% EOU, engaged in manufacture of Terry Towels
and Home furnishings – Based on DGCEI investigation, demands proposed in respect
of (1) non maintenance of separate set of records for manufacture of terry towels
cleared to DTA by using 100% indigenous materials for availment of exemption under
Notification No. 8/97-CE dated 01.03.1997; (2) not satisfying the condition stipulated
under Notification No. 15/2002-CE dated 01.03.2002, that the inputs should have
been procured o n payment of duty; and (3) Non -utilization of yarn received without
payment of duty under CT -3 certificate, in the manufacture of Terry Towel during the
period from 01.04.2000 to 31.03.2000, in violation of input output norms prescribed
under SION – demands confirmed with interest and penalties on firm and individual,
agitated herein.
2015-TIOL-204-CESTAT -MAD
M/s Sujana Steels Ltd Vs CCE (Dated: July 4, 2014)
Central Excise – Clandestine clearances - appellants were engaged in the manufacture
of Iron and Steel products – based on an investigation by DGAE on another Unit (M/s
Chamak), demands were proposed on the appellant firm for their involvement in the
evasion of the duty by M/s. Chamak – same adjudicated with penalties on the firm
including penalty under Rule 209A of the (erstwhile) Central Excise Rules, 1944;
wherein adjudicating authority recorded inter alia that the appellant diverted huge
quantities of shredded scrap without any bills and documents to M/s.Chamak Holding
Ltd., and facilitated to manufacture and clearance of Re -rolled products clandestinely
– Firm settled the matter before the Settlement Commission whereas the personal
penalty was agitated before Commissioner (Appeals) unsuccessfully, culminating in
the instant appeal.
2015-TIOL-203-CESTAT -MAD
CCE Vs M/s Sri Vari Chemicals (Dated: August 13, 2014)
Central Excise - SSI exemption - respondent is engaged in the manufacture of Textile
finishing agents & Soap Oil and availed benefit of SSI Exemption Notification No.1/93CE, dated 28.02.1993 - officers during the visit of the respondent's factory found that
the respondent used the emblem of a man riding on a horse with a word ‘CHEMPON',
which is printed on the invoices and also in the containers - Revenue viewed that the
said logo is owned by M/s. Chempon Alloys Pvt. Ltd.; that hence respondent is
ineligible for SSI benefit; and confirmed demands which were set aside by
Commissioner (Appeals) - In the first round of litigation, Revenue's appeal was
partially allowed by Tribunal which was agitated before the Madras HC who remanded
it for denovo consideration.
2015-TIOL-202-CESTAT -DEL
M/s Birla Corporation Ltd Vs CCE (Dated: November 26, 2014)
Central Excise - CENVAT Credit on various items of Iron and Steel denied on the
ground that the same were used in supporting structures after seeking verification
report from the Deputy Commissioner - Deputy Commissioner certified in favour of
the assessee - The report of the Dy. Commissioner, which was sought by the
Commissioner himself, stands fully ignored by him while passing the impugned order.
For the reasons best known to him, the adjudicating authority has completely shut his
eyes towards the said report. If the said report of the Dy. Commissioner was not to be
taken into consideration by the adjudicating authority, it is not known why the report
was called for - Probably the said report has not been referred to by him as the same
is in favour of the assessee, to the major extent - Such an action, on the part of the
adjudicating authority, cannot be appreciated inasmuch as the same reflects upon the
biased premature determination of their adjudication - Impugned order is set aside
and matter remanded to decide the issue in the light of report by the Deputy
Commissioner. (para 6)
2015-TIOL-195-CESTAT -MAD
M/s Chemplast Sanmar Ltd Vs LTU (Dated: December 8, 2014)
Central Excise - Stay / dispensation of pre deposit - CENVAT credit - applicants
availed credit on capital goods utilized in the railway yard and input services used in
the construction of rest rooms in the railway yard situated outside the factory
premises; viewed as inadmissible by Revenue - demands adjudged, upheld by
Commissioner (Appeals) and agitated herein.
2015-TIOL-194-CESTAT -MUM
M/s Softesule Pvt Ltd Vs CCE (Dated: September 30, 2014)
CE - Appellant availed credit twice on same Bill of Entry - On being pointed out by
Revenue, amoun t of tax was immediately deposited alongwith interest under
intimation to Revenue - No contumacious conduct or fraud on part of appellant - tax
and interest in question was paid on 17.12.2009, whereas SCN was issued on
27.4.2011 i.e. after more than 18 mon ths of such deposit and intimation given by
appellant - appellant is entitled to benefit under sub-section 2B of Section 11A of CEA,
1944 - penalty set aside - Appeal allowed with consequential relief: CESTAT [Para 3,
5]
2015-TIOL-192-CESTAT -MAD
Ramani Engineering Vs CCE (Dated: January 6, 2015)
Central Excise – Stay / dispensation of pre deposit - demand made under Section 11D
of the Central Excise Act, 1944 is under dispute herein.
2015-TIOL-190-CESTAT -DEL
M/s Periwal Exports Vs CCE (Dated: October 29, 2014)
Central Excise – Remission of duty – appellant, a 100% EOU engaged in manufacture
of handicrafts, cleared a consignment consisting of 72 bags of handicrafts for export;
however, the truck met with an accident in which the goods loaded in the truck were
totally destroyed in the fire – subsequently, appellant filed an application for remission
of duty on the goods in terms of Rule 21 of the Central Excise Rules, 2002 before the
proper officer who rejected it on the ground that the loss had occurred after the
removal of the goods – Commissioner (Appeals) upheld denial of remission, now
agitated herein.
Also see analysis of the Order
2015-TIOL-189-CESTAT -DEL
M/s Agmotex Ltd Vs CCE (Dated: October 29, 2014)
CE - Clandestine manufacture and removal - Recovery of parallel invoices - it was
undisputed to be belonging to the appellant - Palpable plea of different hand-writing
over the documents was not proved - When hand -writing experts known to law opined
against the appellant, there was no necessity to rely upon any other expert, who was
not recognised by law - It was plain and simple case of deliberate omission of
production figures appearing in the slips unrecorded in the statutory record resulting
in evasion of duty - Appellant's plea that those were not related to appellant failed to
succeed when author of the slips confirmed that the goods appearing therein were
being manufactured by appellant and duty thereon not paid - duty correctly confirmed
& penalty imposed on appellant proper: CESTAT [ para 8.1 to 8.5]
2015-TIOL-186-CESTAT -MUM
CCE Vs M/s Shree Chh Shahu SSK Ltd (Dated: October 28, 2014)
CE - Manpower services used for handling, loading and unloading of compost & boiler
ash is allowable as CENVAT credit as it is an essential part of manufacture of excisable
sugar - no cause for invocation of rule 6 of CCR, 2004 to deny credit - Appeal allowed:
CESTAT [para 4]
Also see analysis of the Order
2015-TIOL-183-CESTAT -MAD
Chengalrayan Co-Operative Sugar Mills Ltd Vs CCE (Dated: August 4, 2014)
Central Excise - Demand - appellants are manufacturers of sugar and molasses; the
latter required to be stored in steel tanks - appellant sought permission to store them
in katcha pits and masonary tanks, denied by the jurisdictional officer - notice
proposing duty demand on the molasses cleared for storage in katcha pits/masonary
tanks was dropped in adjudication; Commissioner (Appeals) confirmed the demand
allowing Revenue's appeal; now agitated herein.
2015-TIOL-182-CESTAT -DEL
M/s Barco Electronics Systems Pvt Ltd Vs CCE & ST (Dated: September 9,
2014)
Central Excise - SAD - Appellant, a 100% EOU, cleared impugned goods to sister unit
in DTA without paying SAD - Revenue viewed that since no sales tax was paid on such
inter unit transfers, in terms of Notification No. 23/2003-CE SAD was required to be
paid thereon - demands adjudicated and penalties imposed on the firm and
individuals, agitated herein.
2015-TIOL-180-CESTAT -MUM
M/s Raptakos Brett And Co Ltd Vs CCE (Dated: November 3, 2014)
CE - Appellant is manufacturer of medicaments and opted for provisional assessment
while clearing the goods - They paid excess duty in some cases and has short paid
duty in some other cases - Refund of excess duty paid has not been sought by
appellant - As per BSL Ltd - 2014-TIOL-1410-CESTAT -DEL adjustment of excess duty
paid by appellant against short duty on finalisation of provisional assessment is
permissible - impugned order set aside and Appeals allowed: CESTAT [Para 2, 6]
2015-TIOL-175-CESTAT -MAD
M/s ATC Ltd Vs CCE (Dated: October 24, 2014)
Central Excise – Rate of duty - appellants are engaged in the manufacture of
cigarettes of length 69mm – rate enhanced from Rs.809/1000 sticks to Rs.1034/1000
sticks as per Section 141 read with Seventh Schedule to the Finance Act, 2012 –
demands adjudged for the period from 17.3.2012 to 27.5.2012 and agitated herein.
2015-TIOL-174-CESTAT -MAD
M/s Mount Mettur Pharmaceutical Ltd Vs CCE (Dated: November 25, 2014)
Central Excise – Exemption - appellant cleared Intravenous Fluids and claimed the
benefit of exemption under Notification No. 3/2001-CE dated 31.3.2001, viewed as
inadmissible by Revenue; demands adjudicated and agitated herein.
2015-TIOL-173-CESTAT -MAD
M/s Sundaram Fasteners Ltd Vs CCE (Dated: December 8, 2014)
Central Excise - Stay / dispensation of pre deposit - CENVAT credit - appellants have
availed capital goods credit in excess of 50% and subsequently reversed the same demand for interest confirmed in adjudication with penalty; Commissioner (Appeals)
set aside penalty; interest demand agitated herein.
2015-TIOL-169-CESTAT -MUM
CCE Vs M/s Padmashri Dr V V Patil SSK Ltd (Dated: November 26, 2014)
CE - Respondent has paid ST on Manpower Recruitment Agency Service and taken suo
motu credit - An error was committed by respondent but rectified immediately on
pointing out by department - no mala fide intention of respondent to take inadmissible
credit - Commissioner (A) has rightly dropped penalty – No infirmity in impugned
order so same is upheld: CESTAT [Para 6]
2015-TIOL-164-CESTAT -MUM
M/s Maharashtra Seamless Ltd Vs CCE (Dated: October 17, 2014)
CE – Rule 2(k) of CCR, 2004 - Appellant is entitled to take CENVAT Credit on welding
electrodes which have been used for repairs and maintenance and plant and
machinery – Appeals allowed with consequential relief: CESTAT [Para 4, 5]
2015-TIOL-162-CESTAT -MAD
CCE Vs M/s Owens Brockway (I) Ltd (Dated: July 14, 2014)
Central Excise – Valuation - Respondents were engaged in the manufacture of "Glass
Bottles", clearing both printed and unprinted bottles; they received unprinted Glass
bottles from their sister unit at Rishikesh and after printing Coke brand of the buyer,
cleared the bottles from their premises on payment of central excise duty and availed
cenvat credit – Revenue viewed valuation incorrect, proposed demand of duty along
with interest and penalty on the Respondents on the ground of non -inclusion of
insurance and freight charges and other essential ingredients in the assessable value
– demands confirmed, modified by Commissioner (Appeals) and agitated by Revenue
herein.
2015-TIOL-161-CESTAT -MAD
M/s Surya Fine Chemicals Vs CCE (Dated: January 8, 2015)
Central Excise - Classification - Appellant, engaged in manufacture of food colour
preparations both as a manufacturer as well as job worker held bonafide belief that
the same was classifiable under Chapter 21 while Revenue was claiming classification
unde r Chapter 32 of Central Excise Tariff Act, 1985 - Since appellant believed that the
impugned item was not exigible, no registration was taken - However, after insertion
of Chapter Note 7 to Chapter 21 to CETA, 1985 with effect from 16th March, 1995,
department confirmed demands, agitated herein.
2015-TIOL-157-CESTAT -MAD
Wheels India Ltd Vs Commissioner, Large Taxpayer Unit (Dated: April 21,
2014)
Central Excise – CENVAT credit - appellants are engaged in the manufacture of wheels
and components for Cars, Jeeps Tractors, Earth Movers, Construction Equipments and
Air Suspension System - instant appeals were filed against denial of cenvat credit on
the input services on "insurance", "garden maintenance" and "clearing and forwarding
services".
2015-TIOL-156-CESTAT -MUM
Foam Techniques Mfg (I) Pvt Lt d Vs CCE (Dated: December 11, 2014)
CENVAT – Duty paid P.U. foam blocks [CH 39.20/39.21] cut into different sizes and
shapes and cleared by classifying under CH 39.26 on payment of duty by utilizing
CENVAT credit – in the entire proceedings denying the credit on the ground that
activity is not ‘manufacture' the lower authorities have not disturbed this classification
which itself is an indicator that the original input, P.U. foam block, has undergone
change and is now other than the inputs which were procured – having accepted the
CE duty paid, appellant is rightfully eligible to avail credit – Order set aside & Appeal
allowed: CESTAT [para 7, 8, 11]
Also see analysis of the Order
2015-TIOL-151-CESTAT -MUM
M/s Hercules Hoists Ltd Vs CCE (Dated: November 19, 2014)
CENVAT – Rule 2(l) of CCR, 2004 - As per Ultra Tech Cement Ltd. services of erection
and installation of machinery at customers' site is part of business - Therefore,
appellant is entitled to take CENVAT credit on such services: CESTAT [Para 2, 8]
CE – Appellant cleared goods to 100% EOU against CT-3 certificates which was filed
by them before department for claiming exemption under Notfn 22/03 -CE - No steps
has been taken by revenue to verify whether re-warehousing certificate has been
obtained or not to deny the benefit of said Notfn - No allegation of suppression of
facts or wilful misstatement - extended period of limitation is not invokable – Appeals
allowed: CESTAT [Para 9, 10]
2015-TIOL-149-CESTAT -MUM
M/s Kroslink Polymers P Ltd Vs CCE (Dated: December 10, 2014)
CE - Valuation - s.4, 4A of CEA, 1944 - Glues & Adhesives falling under Ch.35 of
CETA, 1985 - Appellants stand that exemption under Rule 34 of the SWAM Rules,
1977 is not mandatory is not acceptable - as appellants are marking the packages as
"Industrial Use", they are exempted from affixing MRP and, therefore, goods have be
valued u/s 4 of CEA, 1944 viz. transaction value - Demand upheld and appeal
rejected: CESTAT [para 4, 5]
Also see analysis of the Order
2015-TIOL-144-CESTAT -MUM
CCE & ST (LTU) Vs Ambuja Cement Ltd (Dated: October 24, 2014)
CE - Assessee engaged in manufacture of cement - Whether waste and scrap of HDPE
bags (being damaged in course of packing cement) arising during manufacturing
process is required to be cleared on payment of duty in terms of rule 3(5) of CCR,
2004 - Commissioner(A) allowing appeal of assessee - Revenue in appeal before
CESTAT. Held: In view of Tribunal decision in Madras Cements Ltd. - 2010-TIOL-1250CESTAT -MAD no credit is required to be reversed/no duty is required to be paid on
clearance of such damaged bags - Revenue's appeal dismissed: CESTAT [Para 3, 6]
2015-TIOL-142-CESTAT -MUM
Bombay Paints Ltd Vs CCE (Dated: December 4, 2014)
CENVAT – Capital goods - Rule 2(a)(A)(i) of CCR, 2004 - Although Steatite Ceramics,
CTH 6804, are capital goods and appellants are entitled to take only 50% credit in
first year, they have taken full credit – since they are entitled to balance credit in
subsequent year, at the most, interest for intervening period is payable – seeking
reversal of credit and imposition of penalty not warranted: CESTAT [para 4]
Also see analysis of the Order
2015-TIOL-141-CESTAT -BANG
Impact Metals Ltd Vs CC, CE & ST (Dated: December 12, 2014)
Excise – Cenvat – Credit wrongly availed but not utilized – Imposition of penalty –
Sustainability – Change of legal position referencing Rule 8(3)(A) relating to unutilized
Cenvat credit not available before original authority while passing order impugned –
On facts, matter remanded for fresh consideration according to due process of law.
(Para 2)
2015-TIOL-138-CESTAT -MUM
M/s Premier Automobiles Ltd Vs CCE (Dated: December 10, 2014)
CE Notfn. 162/86-CE - Cars cleared as taxis dealers de -registering vehicles and
converting into private vehicles duty demand raised on assessee - there is no liability
on the appellant under the notification to ensure continued use of vehicles as taxis
appeal allowed: CESTAT [para 7, 8]
Also see analysis of the Order
2015-TIOL-137-CESTAT -MUM
Rakhoh Enterprises Vs CCE (Dated: September 25, 2014)
CE - Notfn. 6/2006-CE, 12/2012 -CE - Anchor rings and Load Spreading Plates are
used in the foundation of wind mill tower and cannot be considered to be part of Wind
Operated Electricity Generators - benefit of exemption not available; however in r/o
Tower doors since contrary view taken - 2013-TIOL-738-CESTAT-MUM, matter
referred to Larger Bench: CESTAT
Also see analysis of the Order
2015-TIOL-132-CESTAT -MAD
M/s Hinduja Foundries Ltd Vs CCE (Dated: December 18, 2014)
Central Excise – Stay / dispensation of pre deposit – CENVAT credit – appellant
availed input services credit on the basis of debit notes - same viewed as irregular by
Revenue; demands adjudicated, upheld by Commissioner (Appeals) and agitated
herein.
Held: Appellant availed the credit on the service tax paid on professional fee and
internet telecommunication service - In view of the Tribunal rulings in Jalaram Plastic
and Grasim Industires, appellants have made out a prima facie case for waiver of
predeposit of entire dues; and same granted - Friends and Friends ruling relied upon
by Revenue distinguished. [Para 4]
2015-TIOL-128-CESTAT -DEL
CCE Vs Amco India Ltd (Dated: October 20, 2014)
CE - Rule 16 of CER, 2002 does not require maintenance of any records - Returned
goods have to be treated as inputs and the assessee having shown the issuance of the
said inputs from their RG-1 are deemed to have manufactured final product –
allegation that 80% of returned aluminium foil is cleared as scrap and CENVAT availed
thereon is required to be reversed is without any documentary evidence – Revenue
Appeal rejected: CESTAT [ para 6]
Also see analysis of the Order
2015-TIOL-127-CESTAT -MUM
Balmer Lawrie Van Leer Ltd Vs CCE (Dated: October 22, 2014)
CE - appellants clearing drums on payment of excise duty on factory value of goods goods are not sold when cleared from factory but these are transported and stored in
Hyderabad in transporter's warehouse - As and when appellant gets order, they direct
transporter/warehouse owner to deliver said goods to customer's place - charges for
loading, unloading, transportation and warehousing is indicated as Rs.65 per drum Revenue issued the demand on the ground that the said amounts are required to be
added to the assessable value, as the act of sale takes place at the customer's
premises and when the goods are transported and warehoused in Hyderabad, no act
of sale has taken place – Held : In the facts of the case, act of sale takes place at the
premises of customer, therefore, charges includible - No merit in appeal, hence
dismissed: CESTAT [Para 4, 4.1, 5]
2015-TIOL-126-CESTAT -MUM
Aditya Birla Retail Ltd Vs CCE (Dated: November 05, 2014)
CE - Appellants engaged in manufacturing of dutiable as well as exempted products
and availing input service credit - Issue of availment of service prior to April 2011 is
not in dispute - As per Rule 6(5) of CCR, 2004, during relevant time, appellants are
entitled to take CENVAT Credit on input service - It is immaterial whether same is
taken later on as held in Circular 943/04/2011-CX - appellants not required to reverse
the amount equivalent to 5%/10% of value of exempted goods - Order set aside and
appeal allowed: CESTAT [Para 6, 7]
2015-TIOL-125-CESTAT -MUM
Mahindra And Mahindra Ltd Vs CCE (Dated: October 29, 2014)
CENVAT - Appellant is having CE and ST registration and having more than one
manufacturing unit and its head office is registered as an ISD - branch offices have no
separate accounting system and their accounts form part of head office accounts,
which is registered as an ISD - appellant has rightly availed CEVAT credit in respect of
services received at branch office/regional office - invoices are found to be in name of
assessee-company, issued to branch offices - payments are accounted at head office availment of credit and distribution by head office is legal and proper - appeal
allowed: CESTAT [Para 2, 6]
2015-TIOL-117-CESTAT -MAD
M/s Win Enterprises Vs CCE (Dated: November 11, 2014)
Central Excise – Manufacture - carpet mats purchased in roll forms are subjected to
cutting into different sizes and shapes; after cutting into required sizes, the edges of
the mats are stitches with velvet lining through job workers; and on completio n of the
stitching activity, the resultant products, floor mats / car mat emerges - issue
involved in this case is whether conversion of Nylon Tufted Carpet Mats in rolled forms
into floor mats, car mats would amount to manufacture.
2015-TIOL-121-CESTAT -DEL
Rishi Iron And Steel Industries Vs CCE & ST ( Dated: August 14, 2014)
Central Excise - Stay / Dispensation of pre deposit - Offence case - appellant,
manufacturers of MS Ingots from sponge iron and MS scrap, visited by officers production slips detected, showing excess over RG-1 figures, apart from physical
stock shortage of Ingots vis -à-vis RG-1 figures and credit availed sponge / pig iron
vis-à-vis raw material stock register at the time of visit - Shortage of finished goods
and clandestine clearances alleged, demands adjudged, upheld by Commissioner
(Appeals), and agitated herein.
Held : Duty demand on account of shortage of the finished goods and cenvated raw
material is based on the difference between the stock found on the officer's visit to
the factory and the balance of finished goods and raw material recorded in the
statutory registers - for determining the actual shortage the entries in the raw
material register and finished goods register should have been updated - the duty
demand on MS Ingots is based on the production slips pertaining to November 2008
and first fortnight of December 2008 - Based on pattern of electricity consumption,
prima facie the production recorded in the production slips appears to be the actual
production and, as such, the duty demand based on production slips appears to be on
stronger footing - amount already deposited is insufficient to safeguard the interests
of the Revenue; appellant directed to deposit an amount of Rs.3,00,000/ -(Rupees
Three Lakhs) within a period of eight weeks [Para 6]
2015-TIOL-116-CESTAT -MAD
Ramani Plastics Pvt Ltd Vs CCE (Dated: July 4, 2014)
Central Excise – SSI - appellants are engaged in the manufacture of Plastic Hangers,
cleared within local market as well as exported - Show Cause Notices were issued
proposing demand of duty along with interest and penalty, denying the benefit of the
SSI exemption notification – In one case, demands adjudicated; Commissioner
(Appeals) remanded it for reconsidering export clearances whereupon demands were
dropped, extending SSI benefit – agitated by Revenue before Commissioner (Appeals)
who confirmed the demands – In the other case, original authority confirmed the
demands, same upheld by Commissioner (Appeals); both cases agitated herein.
2015-TIOL-115-CESTAT -AHM
M/s Aarti Industries Ltd Vs CCE & ST (Dated: May 23, 2014)
Central Excise – CENVAT credit – Input services credit availed by appe llant reversed in
Sep 2006 and re-availed suo moto in the same month – Revenue viewed that this was
irregular, merited recovery with interest and penalty since the credit was allegedly
taken without support of any duty paying documents and without filing any refund
claim – demands adjudicated, upheld by Commissioner (Appeals) and agitated herein.
2015-TIOL-111-CESTAT -MUM
M/s Essel Propack Ltd Vs CCE (Dated: October 29, 2014)
CE - Appellant availed CENVAT Credit of ST paid on 'Business Support Services'
provided by CHA, Octroi Agents and Freight Forwarders with respect to export of final
products and other materials through Airport/Port - As per Circular 97/8/2007,
eligibility for availing Credit of ST paid is dependent upon place of removal, in facts
and circumstances, which may even include sale taking place at destination point Held: Commissioner (A) has erred in facts and circumstances of case, that place of
removal is not port, but the factory gate - Place of removal is port and accordingly,
impugned order is set aside and appeal allowed: CESTAT [Para 2, 5]
2015-TIOL-105-CESTAT -DEL
M/s Prosafe International Pvt Ltd Vs CCE & ST (Dated: September 8, 2014)
Central Excise – Stay / Dispensation of pre deposit – CENVAT credit - appellants
engaged in the manufacture of safety shoes (dutiable), handling gloves (exempt) and
work wears (exempt); availed Cenvat Credit on common input services – Revenue
viewed that a n ‘amount' in terms of Rule 6(3) of Cenvat Credit Rules 2004 is
reversible on the value of exempted clearances; adjudicated demand for recovery of
the same with interest and penalty; agitated herein.
2015-TIOL-104-CESTAT -MUM
M/s Positive Packaging Industries Ltd Vs CCE (Dated: September 19, 2014)
CE – Appellant manufactured goods and cleared the same for domestic market as well
as exported under claim of rebate or undertaking - In sale agreement entered into
between appellant and its overseas purchaser, price was to be re-determined on
finalization of books of account - Goods were not undervalued at the time of export as
according to agreement, tentative price was subjection to variation after end of
financial year on finalization of accounts - Accordingly, there is no suppression or any
intention to evade duty etc. on part of appellant - SCN is held to be time barred as
appellant is not liable to pay duty in case of completed export on raising of
supplementary invoice - there can be no demand of any interest for the same when
duty itself is not payable - impugned order set aside and appeal allowed: CEST AT
[Para 2, 5]
2015-TIOL-103-CESTAT -MUM
CCE Vs Suraj Texcom (Dated: October 31, 2014)
CE – CENVAT - It has been alleged that respondent has purchased inputs i.e. yarn to
tune of Rs. 77,27,761/- - Investigation was not conducted to verify invoices issued by
suppliers - It cannot be alleged that invoices issued by suppliers are not cenvatable, in
absence of any concrete evidence brought on record by Revenue - Commissioner (A)
has considered all aspects and arrived at a decision that for purchase of yarn to tune
of Rs. 77,27,761/- respondent is entitled for Cenvat Credit on these inputs which
works out to Rs. 5,48,401 - No infirmity in impugned order so same is upheld:
CESTAT [Para 4]
2015-TIOL-101-CESTAT -MAD
Amman Woven Sacks Ltd Vs CCE (Dated: August 19, 2014)
Central Excise – Interest on delayed payment of duty – demand of interest under
Section 11A read with Rule 8 of Central Excise Rules, 2002 and penalty under Rule 25
adjudicated, upheld by Commissioner (Appeals) and agitated herein.
2015-TIOL-95-CESTAT-MUM
M/s Yash Krishni Food Services Ltd Vs CCE (Dated: December 12, 2014)
CE – Brand name ‘Ribbons & Balloons' belonged to M/s. Bharat Cafe Pvt. Ltd. - Fact
that M/s. Bharat Cafe Pvt. Ltd were not manufacturer or trader or seller of the said
goods at the relevant time is of no consequence – benefit of SSI exemption 8/2003 -
CE not available to appellant – extended period of limitation attracted - cum-duty
benefit available – duty since paid at full rate during the period 9.11.2006 to
31.03.2007, demand for the said period not maintainable – duty liability to be
recomputed by adjudicating authority by extending cum duty benefit – penalty under
s.11AC to be reworked – interest payable – appeal disposed of: CESTAT
Also see analysis of the Order
2015-TIOL-94-CESTAT-MAD
Jyothy Laboratories Vs CCE (Dated: October 7, 2014)
Central Excise – Stay / dispensation of pre deposit – CENVAT - appellant is a
manufacturer of detergent powder and detergent cakes; availed cenvat credit on
advertisement service and broadcasting services – Revenue viewed the same
inadmissible, confirmed demands, upheld by Commissioner (Appeals), agitated
herein.
2015-TIOL-93-CESTAT-MAD
M/s Larsen And Toubro Ltd Vs CCE (Dated: June 12, 2014)
Central Excise – Valuation - appellants are engaged in the manufacture of fabrication
of heavy engineering items viz. iron and steel structures, parts of cement plant
machineries, ESP components etc.; entered into a contract with M/s. Mahindra and
M/s. Hyundai for fabrication work and assistance in erection, installation and
commissioning of the plant at their premises; executed the contracts on job work
basis and paid the duty on cost of raw materials and conversion charges on the Ujagar
Prints formula - fabrication job done as per the drawings of M/s. Durr, Germany,
which were supplied free of cost, hence not included in their assessable value –
Revenue viewed that the appellant violated Section 4 of the Central Excise Act, 1944
read with Rule 5 of the Central Excise (Valuation) Rules, 1975; that the appellants are
liable to pay differential central excise duty arising due to non -inclusion of preengineering drawing and design charges in the assessable value - demands
adjudicated and agitated herein.
2015-TIOL-92-CESTAT-DEL
CCE Vs M/s Petro Carbon Industries Ltd (Dated: September 2, 2014)
Central Excise – Clandestine clearance - Respondent are manufacturers of Calcined
Petroleum Coke (CPC) falling under Tariff item heading 2713.12 of the Tariff; raw
material for the CPC is Raw Petroleum Coke (RPC) falling under Tariff sub -heading
2713.11 – CE officers visited the Unit and launched an investigation establishing (a)
difference between the quantities mentioned in the invoices and the quantity
mentioned in the corresponding weighment slips; (b) consumption of jute and plastic
bags during the period of dispute was much more than the bags which would have
been consumed on the basis of the clearances recorded in the RG-1; (c) There were
some GRs showing dispatch of CPC in respect of which they were no GP -1s; (d) goods
cleared to sister unit for manufacturing carbon paste was CPC and not RPC as per
respondent's records; (e) in respect of credit availed RPC, Rule 9A (3A) of the Central
Excise Rules, 1944 was violated, resulting in short payment of duty – demands with
interest and penalties on firm and individuals under proviso to Section 11A (1) of the
Central Excise Act, 1 944, Rule 173Q (1) (d) and Rule 209A of the Central Excise
Rules, 1944 adjudged and agitated before Tribunal, who remanded the matter for
denovo adjudication whereupon the original demands were modified to the effect that
demands related to (a), (b), (c) and (e) were dropped as also penalties on individuals;
now agitated by Revenue herein.
2015-TIOL-86-CESTAT-BANG
Manidhari Stainless Wire Pvt Ltd Vs CC, CE & ST (Dated: September 8, 2014)
Excise – Natural Justice – Speaking Order – Wrong utilization of inputs and Cenvat
credit – Omission to give specific documents to defend – Commissioner directed the
Additional Director DGCEI office to verify and confirm specific documents during
investigation relied upon by Revenue and not supplied to appellant – Commissioner's
adjudication order thereafter without giving an opportunity to the appellant to go
through the process of verification with DGCEI wholly unjustified – Matter remanded –
Commissioner directed to pass reasoned order. (Para 7, 8)
2015-TIOL-85-CESTAT-KOL
M/s Hindalco Industries Ltd Vs CCE (Dated: November 21, 2014)
CENVAT - Applicant availed CENVAT Credit on the basis of invoices issued by M/s.
Aditya Birla Management Corpn. Pvt. Ltd. (M/s. ABMCPL) relating to the input services
received viz. Business Support Service -Revenue alleges that since M/s. ABMCPL have
been distributing the expenditures borne by them on behalf of the applicant they
ought to have been registered as an ISD -credit denied of Rs.1.99 crores -appeal to
CESTAT.
2015-TIOL-84-CESTAT-MUM
Privi Organics Ltd Vs CCE (Dated: March 3, 2014)
CE - Limitation - appellant undertook physical export by availing benefit of Notification
No. 23/2003 -CE, where they effected the DTA clearances at concessional rate of duty
in excess of the 50% of the FOB value - department contends that the appellant
should have discharged full duty and not concessional duty on the excess clearances
as they exceeded 50% limit HELD : If the clearances exceed the limit, no doubt, the
appellant can clear the goods into DTA but duty liability has to be discharged at the
full rate of duty - In the absence of suppression or willful mis -statement of facts, the
demand is hit by time bar - prima facie case made out for grant of stay: CESTAT [Para
6.1]
2015-TIOL-77-CESTAT-MUM
M/s Essel Propack Ltd Vs CCE (Dated: October 29, 2014)
CE – Appellant availed CENVAT Credit of ST paid on various input services – Revenue
observed that appellant is availing Credit in respect of ST paid on expenses for various
services, which were not considered as input service for appellant like, insurance for
transit (report) service, transport insurance being beyond place of removal, brokerage
charges, subscription fees, Credit card services etc. - under Rule 2(l) of CCR, 2004
input includes not only expenses directly related but also indirectly related to business
of manufacturing - all services in question are input services for appellant
manufacturer - Matter decided on merit in favour of appellant - question of limitation
left undecided - impugned order set aside and appeal allowed: CESTAT [Para 2, 5]
2015-TIOL-71-CESTAT-DEL
M/s Dewas Fabrics Ltd Vs CCE (Dated: September 19, 2014)
CE -Goods cleared from factory but not exported - Fraudulent records created to show
export - For recovery of duty on goods which were cleared without payment of duty
but not exported, there is no time-bar as such clearances are covered by the bond
which was executed -Duty demand upheld - Penalty correctly imposed - Appeals
rejected: CESTAT
Also see analysis of the Order
2015-TIOL-70-CESTAT-MUM
M/s Pushpak Steel Industries Pvt Ltd Vs CCE (Dated: September 19, 2014)
CENVAT - Appellant had purchased an Electric Motor on payment of CE duty - Credit
availed and subsequently utilized for payment of duty on their finished goods - Electric
Motor was cleared after use - In Raghav Alloys Ltd. - 2010-TIOL-881-HC -P&H-CX it is
held that removal of capital goods pursuant to use is not 'Removal as such' and duty
paid on transaction value at the time of removal, prior to 13.11.2007, is correct facts are covered by the ruling & in favour of appellant - SCN dated 21.04.2009 is
time-barred, as transaction had taken place in November, 2005 - order set aside and
appeal allowed: CESTAT [Para 2, 3.4, 5]
2015-TIOL-69-CESTAT-MUM
M/s Indo Rama Synthetics (I) Ltd Vs CCE (Dated: October 22, 2014)
CE – S.4 of CEA, 1944 - Valuation - Appellant is a manufacturer of polyester yarn Total amount of freight and insurance charges recovered by appellant was more than
the freight incurred/amount paid by them as premium to insurance companies –
Following the decision in case of Baroda Electric Meters ltd. - 2002-TIOL-96-SC-CX , it
is held that differential amount not includible in AV since duty of excise is on
manufacture and not on profit made by dealer on transportation - Appeal allowed:
CESTAT [Para 2, 5]
2015-TIOL-68-CESTAT-KOL
Kaizen Organics Pvt Ltd Vs CCE & ST (Dated: October 30, 2014)
CE - Appellant availed CENVAT credit of the duty paid on inputs supplied by M/s
Koolmint Manufacturing Company - Revenue alleging that since M/s Koolmit did not
have the necessary infrastructure for manufacture of the inputs, the credit availed by
applicant is inadmissible; that duty paid by M/s Koolmit is considered as deposit u/s
11D of CEA, 1944 and not duty - appeal to CESTAT.
2015-TIOL-65-CESTAT-BANG
M/s 3M India Ltd Vs CCE (Dated: October 21, 2014)
Excise - Cenvat - Large Tax Payer Unit - Imposition of interest and penalty on credit
wrongly availed - Appellant availed excess credit as well as short credit availment
apparently due to clerical error and reversed as soon as omission pointed out - Bona
fide and genuine mistake occurred - On facts held, not a fit case warranting imposing
penalty - However demand for Cenvat credit with interest upheld - Appeal accordingly
disposed of. (Para 3)
2015-TIOL-60-CESTAT-AHM
M/s Adani Energy Ltd Vs CST (Dated: September 30, 2014)
CE/ST – Extension of stay - CESTAT has the powers to extend the stay beyond the
period of 365 days under the provisions of Section 35C (2A) of the Central Excise Act,
1944 - stay was granted to the appellant on 26/08/2009 - After granting of stay to
the appellant, the appeal was never listed for final hearing by Registry due to heavy
work load - there is no fault of the appellant in seeking extension of the stay already
granted - Request made by the appellant is genuine and extension of stay is granted
for a further period of 180 days: CESTAT [ para 2, 3, 6]
2015-TIOL-59-CESTAT-BANG
LA Mansion Granites Ltd Vs CCE,C & ST (Dated: November 17, 2014)
Excise – Exportation of goods – Onus lies on assessee to substantiate proof of exports
in support of duty exemption – Due to unavoidable circumstances of closure of
business and take over of industry by financier, photocopies of documents duly
endorsed by the Customs authorities at the port of export against certain
consignments submitted – Duty cast on jurisdictional authority at de novo
adjudication proceedings to locate original export documents available either in the
Customs House (CH) or in the jurisdictional Central Excise office to ascertain actual
exportation of goods – Rejection ex -facie on ground of possibility of manipulation
without verifying records, deprecated – Matter remanded to verify and ascertain
actual exportation from documents submitted vis -à-vis original documents with CH –
With regards to claim of exportation of other consignments in question, Custom's
endorsed ARE1s and supporting Bills of Lading not submitted at de novo adjudication
proceedings as such appeal against said export consignments dismissed directing
appellant to pay the duty with interest. (Para 9, 10)
2015-TIOL-58-CESTAT-MAD
M/s Arun Plasto Moulders (India) Pvt Ltd Vs CCE (Dated: August 20, 2014)
Central Excise – CENVAT credit - appellants are engaged in the manufacture of
Injection Moulding components - dispute relates to denial of credit on HIPS and GPPS
and demand along with interest and penalty; first stage appeal dismissed for non
compliance with stay order, agitated herein.
2015-TIOL-55-CESTAT-MUM
John Deere Equipment Pvt Ltd Vs CCE (Dated: December 17, 2014)
CE - S.35A(3) of CEA, 1944 - Commissioner(A) could not have enhanced penalty
without issuance of any show-cause notice - Matter remanded: CESTAT [para 4]
Also see analysis of the Order
2015-TIOL-51-CESTAT-DEL
M/s English Indian Clay Ltd Vs CCE (Dated: October 17, 2014)
CE - Adjudicating authority's observation that any physical change like change in
brightness/whiteness will result in manufacture of "modified starch" covered under
Ch. Heading 35.05 is devoid of any basis - conjectures cannot be basis for deciding
classification - Order set aside & appeal allowed: CESTAT [para 11, 12, 13, 14]
Also see analysis of the Order
2015-TIOL-50-CESTAT-AHM
M/s Elite Pharma Pvt Ltd Vs CCE (Dated: September 30, 2014)
CE - Extension of stay - CESTAT has the powers to extend the stay beyo nd the period
of 365 days under the provisions of Section 35C (2A) of the Central Excise Act, 1944 stay was granted to the appellant on 3/11/2008 - After granting of stay to the
appellant the appeal was never listed for final hearing by Registry due to heavy work
load - there is no fault of the appellant in seeking extension of the stay already
granted - Request made by the appellant is genuine and extension of stay is granted
for a further period of 180 days: CESTAT [ para 2, 3, 6]
2015-TIOL-49-CESTAT-DEL
Khalik Ahmed Vs CCE & ST (Dated: November 18, 2014)
CE - Pan Masala Packing Machines (Capacity Determination and Collection of Duty)
Rules, 2008 - illegal manufacture and clandestine clearance of the Pan Masala/
Gutkha under the brand name of Suhana – Duty demand and penalty of Rs.1 crore
each - appellant submitting that premises given on rent to Shri Vijay Mishra statement of two workers mentioning that the packing machine found installed was
belonging to the appellant and both the workers were locked in by the appellant from
7 am to 8 pm and were made to work on the said packing machine – statement
retracted subsequently and when summoned again they changed their statement and
admitted having worked for the appellant – in the matter of the plea of the appellant
of premises having been leased out to Shri Vijay Mishra, AR submitted that in spite of
the efforts made by the Revenue to locate Shri Vijay Mishra at the address given by
the appellant, they have not been able to do so and the investigations carried out
clearly establish that there was no Vijay Mishra residing at the given address.
2015-TIOL-48-CESTAT-DEL
M/s Bhansali Engg Polymers Ltd Vs CCE & ST (Dated: October 27, 2014)
CE - Refund - Appellant clearing goods on stock transfer basis to their second unit When the assessments were finalized, the same resulted in refund, as the duty finally
assessed was less than the duty paid on provisional basis - while the Satnoor unit of
appellant filed these refund claims, the Abu Road unit reversed the CENVAT credit of
the duty whose refund was sought by the Satnoor unit, as initially when the Satnoor
unit had cleared the HRG powder and E-SAN powder to Abu Road unit on payment of
duty, the Abu road had taken its CENVAT credit - Appellant filed refund claims which
were a llowed by Asst. Commr. by also holding that unjust enrichment was not
involved - Commissioner(A) holding that claims are hit by bar of unjust enrichment appeal to CESTAT.
2015-TIOL-44-CESTAT-DEL
Hindustan Zinc Ltd Vs CCE (Dated: July 16, 2014)
Central Excise - Whether adjustment of excess payment against short
payment has to be allowed on finalisation of Provisional assessment - Matter
goes to Third Member: Whether inter se adjustment of duty short paid and duty
excess paid during the period of provisional assessment is permitted at the time of
finalisation of assessment in terms of Rule 7 of the Central Excise Rules when the
appellants are not en titled to refund of duty excess paid. Whether interest is
chargeable on the duty short paid in terms of sub-rule (4) of Rule 7 of Central Excise
Rules regardless of the duty excess paid during different segment of the period
involved when the appellants are not entitled to refund of duty so excess paid.
Also see analysis of the Order
2015-TIOL-43-CESTAT-DEL
M/s R B Steel Services Vs CCE & ST (Dated: September 30, 2014)
CENVAT - If the department levies and collects the Central Excise duty on the goods
removed from the factory, they cannot claim, for the purpose of allowing CENVAT
credit, that the process of manufacture had not taken place – Credit rightly availed –
Appeals allowed: CESTAT [ para 4, 5]
Also see analysis of the Order
2015-TIOL-42-CESTAT-DEL
M/s I J Steels And Castings Pvt Ltd Vs CCE (Dated: October 28, 2014)
CE - Penalty - Since the entire disputed amount of CENVAT credit had been paid
during investigation and much before the adjudication, the adjudicating authority
ought to have given the option to pay lower penalty u/s 11AC of CEA, 1944: CESTAT [
para 6]
2015-TIOL-35-CESTAT-MAD
M/s Bhavani Enterprises Vs CCE (Dated: September 16, 2014)
Central Excise - Stay / dispensation of pre deposit - Job work valuation - applicants
are engaged in the manufacture of HDPE Bottles on job work for Marico Industries
who supplied the HDPE granules - goods cleared on payment of duty assessed under
Ujagar P rints formula whereas Revenue viewed that it should be assessed under Rule
8 of the CE Valuation Rules 2000 - demands confirmed, modified by Commissioner
(Appeals) and agitated herein.
2015-TIOL-34-CESTAT-DEL
M/s Kamakhya Steels Pvt Ltd Vs CCE (Dated: November 18, 2014)
CE - Expressing unhappiness in a marriage can never be taken to be tantamount to
opting for divorce - after having opted in for pa ying duty under Rules 96ZO( 3) on
annual capacity of production unless they opted out of the compounded levy scheme
they could not have paid duty on actual production basis u/s 3A (4) of the CEA, 1944:
CESTAT [ para 6, 7, 8, 9]
Also see analysis of the Order
2015-TIOL-28-CESTAT-DEL
M/s Jagatjit Industries Ltd Vs CCE (Dated: November 7, 2014)
CENVAT - Appellant taking credit of differential duty paid under cover of
supplementary invoice by principal manufacturer after finalization of provisional
assessment - since this is not a case of any suppressed production or malafide intent
to evade payment of duty, invocation of Rule 7(1)(b) of CCR to deny credit is
improper - Appeal allowed: CESTAT [ para 5, 7, 8]
Also see analysis of the Order
2015-TIOL-27-CESTAT-MUM
Ace Glass Containers Vs CCE (Dated: November 12, 2014)
CE - Appellant is engaged in activity of printing on Glass Bottles - Levy of duty on the
activity of printing on glass bottles came into effect from 03.08.1998 - Final products
were cleared from appellants' factory prior to 03.08.1998 to their godown – Said
goods have been cleared from their godown on payment of duty which was not
required to be paid by appellants - Relying on decision in case of Ajinkya Enterprises 2012-TIOL-578-HC -MUM-CX it is viewed that as duty has been paid by appellants on
clearance of final products which was not required to pay, the same amounts to
reversal of CENVAT Credit which is sought to be denied by way of impugned order demand of duty is not sustainable - Accordingly, levy of interest and penalties are also
not sustainable - appeals allowed: CESTAT [Para 2, 7]
2015-TIOL-23-CESTAT-BANG
Bharat Electronics Ltd Vs CCE, C & ST (Dated: December 1, 2014)
Central Excise – Cenvat – Cenvat credit on outdoor catering services passed on by
head office and availed by intermediary – Whether or not used in relation to
manufacture of goods– Issue is debatable – Needs detailed consideration.
Central Excise – Cenvat – Medi-Claim insurance services – Denied on ground that it is
provided to retired employees as such having no nexus with manufacturing – Issue is
also debatable – Prima -facie case in favour of appellant – Pre-deposit waived. (Para 3)
2015-TIOL-21-CESTAT-MUM
M/s GNFC Ltd Vs CCE (Dated: October 16, 2014)
CE – Appellant is manufacturer of chemicals and fertilizers - Chemicals are chargeable
to duty and fertilizers prior to 1.3.2011 were exempted – For said manufacture
catalyst and catchment's gauze of precious metal were required which after certain
period of use are required to be recharged - On 1.3.2011, Government withdrew
exemption on articles of precious metal and thus duty became chargeable on catalyst
and catchment's gauze - M/s Hindustan Platinum Ltd . later on paid the duty and
recovered from appellant – Appellant filing refund claim. Held: No duty is chargeable
on goods in view of retrospective amendment made by FA, 2014 and provisions
contained thereunder will entitle the refund of duty already paid if filed within six
months - details of FA, 2014 was not available when the case was adjudicated by
original authority so matter remanded back to original authority: CESTAT [Para 2, 4,
5]
2015-TIOL-18-CESTAT-AHM
M/s Bhilosa Industries Pvt Ltd Vs CCE (Dated: October 27, 2014)
Central Excise - Exemption - Notification No. 30/2014-CE - Exemption to All filament
yarns procured from outside and subjected to any process by a manufacturer who
does not have the facilities in his factory (including plant and equipment) for
manufacture of filament yarns of chapter 54. - Meaning of the expression 'his factory'
: Under the Central Excise Taxation duty of Central Excise is levied on the 'act of
manufacture' as defined in Section 2(f) of the Central Excise Act 1944 and the person
who carries out the 'act of manufacture' is the manufacturer. A 'manufacturer' who is
liable to pay duty becomes an 'assessee' by virtue of Rule -2(c) and has to take out a
Registration as per the provisions of Rule 9 of the Central Excise Rules 2002. From the
above basic elements of Central Excise law a manufacturer is the person wh o carries
out the act of manufacture. (para 9.4)
Also see analysis of the Order
2015-TIOL-17-CESTAT-MAD
Hinduja Foundries Ltd Vs CCE (Dated: September 1, 2014)
Central Excise – Stay / dispensation of pre deposit – Demand - appellants are
manufacturers of Iron & Aluminium Castings – Demands on Black Sand (Dross)
cleared without duty confirmed with interest and penalty, upheld by Commissioner
(Appeals) on the ground that the goods are distinctly classifiable under sub heading
2619 00 90 of the CETA and it is a distinct commodity with the different usage and
commercially marketable; agitated herein.
2015-TIOL-15-CESTAT-MUM
M/s Cipla Ltd Vs CCE (Dated: October 17, 2014)
CENVAT – Cenvatted capital goods cleared after putting them to use – appellant
paying duty on transaction value – Revenue views that goods were removed as such,
so appellant is required to reverse CENVAT Credit. Held: As per decision of Bombay
High Court in Cummins India Ltd., issue is no more res integra - appellant has rightly
paid the duty on transaction value – Appeal allowed: CESTAT [Para 2, 4]
2015-TIOL-04-CESTAT-MUM
M/s Monomer Chemical Industries Ltd Vs CCE (Dated: October 17, 2014)
CE – s.6 of CEA, 1944, rule 9 of CER, 2002 - Premises obtained on lease from MIDC Registration cannot be denied on the ground that earlier occupant of the premises had
dues pending against them – Appeal allowed with consequential relief: CESTAT [para
7]
Also see analysis of the Order
2015-TIOL-03-CESTAT-MUM
M/s Uttam Galva Steels Ltd Vs CCE (Dated: November 3, 2014)
CENVAT – Admissibility of input service credit on Outward Transportation Service
during February 2005 to March 2006.
Held: Appellant is entitled to get Credit on Outward Transportation Service prior to
01.04.2008 in the light of LB decision in ABB Ltd - 2009-TIOL-830-CESTAT-BANG-LB impugned order set aside and appeal allowed : CESTAT [Para 5, 6]
2015-TIOL-02-CESTAT-BANG
Andhra Cements Ltd Vs CCE, C & ST (Dated: July 25, 2014)
Excise - Sick Company - Cenvat Credit irregularly availed - Interest and penalty
sustainability - Availment of Cenvat credit in the subsequent month is a mere
procedural violation - Once the credit is availed and entered in the books, it can be
used for payment of duty on the output and there is no one to one correlation
required -No provision prohibiting availment of Cenvat credit during default period in
question - More over default was not beyond one month - Utilization of Cenvat credit
during the next month for payment of duty relating to the previous month thus cannot
be faulted with - Attempt of Revenue that entire amount has to be paid in cash and till
the payment was made, interest is liable to be paid held not correct - As appellants
have not ava iled the benefit extended by BIFR to pay Principal amount in installments
and discharged entire amount crystallized including interest, interest is set aside and
penalty upheld but reduced from 10 lakhs to 1 lakh. (Para 13, 14)