2022-TIOL-648-CESTAT-MUM
Supermax Personal Care Pvt Ltd Vs CCE
CX - The appellant is availing Cenvat credit on input/input service and capital goods as per CCR, 2004 - They consented to join Large Tax Payers Unit and allotted Membership No. - There are two issues for consideration; whether payment of Rs. 5,00,000/- by appellants on 26.03.2013, from their CENVAT account, can be considered as payment of defaulted duty for the month of February, 2013 as per Rule 8 of CER, 2002; whether the rigors of Rule 8(3A) shall apply to clearances made by appellant after that date and demand for clearance made during the period 26.03.2013 to 28.02.2014 could have been made by revenue by invoking provisions of Section 11A of CEA, 1944 - As regards to first issue, in terms of Proforma of ER-1 and provisions of Rule 8, there appears to be no bar created on utilization of CENVAT Credit for payment of defaulted duty - In view of clarification issued by Board Circular 962/05/2012-CX there seem to be no requirement that the arrears that have arisen under Rule 8 were required to be paid in cash only, utilization of CENVAT Credit for payment of said arrears is permissible, subject to condition that the balance was available in account of appellant - There seem to be nothing wrong in appellants discharging defaulted duty liability as per Rule 8 from their CENVAT account - Appellant had filed "Consent Form For Companies Participating in LTUs" which was received on 9th March 2012 - However they were given the permission to operate as LTU vide letter dated 28.02.2013, nearly one year after filing the consent form - The delay in according permission to operate as LTU, was primary reason for delay in transfer of available credit from one Plant to another - No justification found in holding that payment of amount of Rs. 5,00,000/- from their CENVAT account was not enough to discharge duty arrears for month of February-2013 in terms of Rule 8 - However, the fact in regards to transfer of CENVAT Credit of Rs 43,26,000/- by Plant-IX to Plant –VII needs to be verified by concerned Commissioner. Undisputedly appellants have paid defaulted duty for month of February 2013, by making a debit entry in CENVAT Account on 26.03.2013. Even if this debit was to be considered as not a valid payment of duty, then also appellant could not have been proceeded against for clearances made after 26.03.2013, in terms of Rule 8(3A) - Whereby an assessee discharges duty liability for a month on or before due date as per Rule 8, by way of debit entry in credit account and subsequently the debit so made is found to be erroneous/ mala fide , then also rigors of Rule 8 (3A) will not come into picture - In such case, revenue proceeds against such defaulter by way of initiation of proceedings for short/ nonpayment of duty in terms of Section 11A of CEA, 1944 - Admittedly during period of default appellants have acted as per the provisions of Rule 8 (3A) and have discharged duty consignment wise without utilizing the CENVAT Credit available with them, demand of duty made for period after 26.03.2013, is set aside - Matter remanded to original authority for very limited purpose of verification of fact of transfer of CENVAT Credit from Plant – IX to Plant –VII in terms of Rule 12A(4) of CCR, 2004: CESTAT
- Appeal partly allowed: MUMBAI CESTAT
2022-TIOL-647-CESTAT-MUM
Crompton Greaves Ltd Vs CCE
CX - Assessee had received excisable goods in their factory for repair without original duty paying documents from their customers - Assessee had filed intimation with the range officer about receipt of said goods - Assessee availed CENVAT credit based on photocopy of triplicate copy of their invoice where goods were originally cleared by assessee on payment of duty - Assesee had applied under Rule 16(3) Central Excise Rules, 2002 to receive the goods back for repair but availed CENVAT credit under Rule 16(1) ibid - Respondents alleged that assessee availed credit in violation of Rules 16(3) and 16(1) ibid - Impugned order confirmed the demand of credit along with interest. Held : Rule 16(3) ibid is meant to remove difficulties experienced by literal implementation of Rule 16(1) ibid - Rule 16(3) ibid is not independent, and goods maybe received for repair by following procedure in Rule 16(1) ibid - Commissioner had expressed his satisfaction after receiving triplicate copies of the invoices and held that there was nothing erroneous in following Rule 16(1) ibid - After this, he could not have confirmed the demand for credit under Rule 14 of CENVAT Credit Rules, 2004 read with Section 11A of Central Excise Act, 1944 - Further, there was no delay in payments required to be made under Rule 16(2), therefore amount of interest cannot be sustained - Impugned order set aside - Appeal allowed: CESTAT
- Appeal allowed: MUMBAI CESTAT
2022-TIOL-646-CESTAT-MUM
Cox And Kings Ltd Vs CST
ST - Assessee-company went under liquidation and matter was adjourned to allow opportunity to Official Liquidator/Resolution Professional to cause appearance in this matter - Subsequently, Resolution professional was replaced, and another person was to be appointed.
Held : No application filed by successor-in-interest in matter of continuation of proceedings even after passing of sufficient time - In absence of such application, by operation of Rule 22 CESTAT (Procedure) Rules, 1982 the appeals abate - Appeals abated: CESTAT
- Appeals Disposed of: MUMBAI CESTAT
2022-TIOL-645-CESTAT-MUM
Thyssenkrupp Industrial Solutions India Pvt Ltd Vs CCT
ST - It is common ground in rival disputations of this appeal that liability does arise under Rule 6(3) of CCR, 2004 for 2013-14 and 2014-15 - However, appellant is convinced that reversal of credit effected by them has erased the obligation while Commissioner (Appeals) has upheld recovery of Rs. 23,45,469, out of Rs. 52,87,392 demanded in SCN and confirmed by original authority under Rule 14 of CCR, 2004, along with applicable interest as well as penalty under Rule 15 of Rules - This dispute over the formula in Rule 6(3A) arose in consequence of exercise of that option, from among those in Rule 6(3) for neutralization of credit that, in conformity with injunction in Rule 6(1) could not be continued and the obvious disinclination to resort to mandate of Rule 6(2) - The non obstante qualification of Rule 6(3) accords regularity to other modes of neutralization that, at best, are approximations of attribution - The decisions of Tribunal have determined interpretation of 'total CENVAT credit' and applicability to present dispute hinges upon extent to which the credit arising from 'input services' used in common is distinguishable from 'total CENVAT credit'; the spectrum of such credit may extend anywhere between 'nil' and the entirety of CENVAT credit with the gap increasing upon accountal of each service in the manner prescribed in rule 6(2) - Therein lies the nub: it is not the total lack of separate accounting but the incompleteness of that which can give rise to disputations such as this - The claim of appellant for discarding of determination in impugned order rests upon correct segregation of credit taken on 'input services' between eligible and ineligible except to extent that the formula had to be resorted to; claim of Revenue rests upon lack of such segregation of entire credit - Neither the submissions during hearing nor the records of proceedings before lower authorities indicate such partial segregation or correctness of it - In the absence of such ascertainment, principle alone can established with the consequent impact on recovery to be quantified upon presentation of segregated accounts and verification thereof - For that purpose, impugned order is set aside and recomputation restored to the original authority before whom the accountal of credit taken on 'input service' shall be furnished by appellant and to which the ratio in the formula is to be applied: CESTAT
- Matter remanded: MUMBAI CESTAT
2022-TIOL-644-CESTAT-MUM
Technova Imaging Systems Pvt Ltd Vs CC
Cus - Issue relates to refusal of SAD to appellant by Refund Sanctioning Authority that has received concurrence of Commissioner (Appeals) in second round of litigation - Refund of SAD is primarily governed by Notification No. 102/2007-Cus. and guided by its clarificatory Circular issued from time to time - Commissioner (Appeals) in the first round of litigation had already given a finding that claim of refund of applicant survives and thereafter review of said order by adjudicating authority in limited remand for verification of documents so as to ascertain that the same is in conformity to law, is beyond the power of adjudicating authority, as it can only be exercised by appellate authority - Judicial precedent has been set by Madras High Court in case of Johnson Lifts Pvt. Ltd. in which it was clearly stipulated that department is bound to accept the description of goods in import documents as well as sale invoice to be one and the same, on the strength of certificate/correlation statement issued by Statutory Auditor (Chartered Accountant) - Appellant is entitled to get a refund alongwith applicable interest towards refund of SAD paid against Bills of entry and Department is directed to pay the same within two months: CESTAT
- Appeal allowed: MUMBAI CESTAT
2022-TIOL-643-CESTAT-AHM
Shobha Plastics Pvt Ltd Vs CC
Cus - The lower authority vide impugned order has imposed penalty under Section 112(a) of Customs Act, 1962 upon Jayesh Mehta and Harshad Vadodaria on the ground that appellants have aided and abetted the importer in importing goods by way of mis-declaring the country of origin - The appellants said role in relation to import of goods is not borne out of facts on record - Significantly, the case of department of mis-declaration of Chinese origin goods for evading anti-dumping duty is wholly directed against Nalin Mehta - Jayesh Mehta has stated in his statement that he attended the work of customs clearance as representative of CHA and acted upon direction of Nalin Mehta - There is no evidence to show that at the time of imports he was aware that goods were allegedly being mis-declared by Nalin Mehta to customs - Harshad Vadodaria has specifically stated in his statement that he was not aware that by using his factory's name and IEC Nalin Mehta and Jayesh Mehta indulged in evasion of anti-dumping duty by mis-declaring the country of origin - There is no other reliable and corroborative evidence to establish that appellants herein had knowledge that goods imported were of Chinese Origin, in that view it cannot be said that appellants herein have committed any act or omission, which rendered the goods liable to confiscation, accordingly penalty under section 112(a) ibid cannot be sustained - As regards, Shobha Plastics, the Commissioner fastened duty liability jointly and severally upon Shobha Plastics and Nalin Mehta - However, the said Order was set aside by Tribunal with a direction to Commissioner to fix duty liabilities on each and every individual separately - Accordingly, Commissioner held Nalin Mehta to be the importer of goods and fixed duty liability upon him along with interest and penalties - The appellant, Shobha Plastics was not held liable to duty - Appropriation of amounts deposited by or on behalf of Shobha Plastics during investigation towards duty and interest liability in impugned order cannot be sustained - Impugned order to the extent it is against the present appellants is not sustainable, hence the same is set aside: CESTAT
- Appeals allowed: AHMEDABAD CESTAT
