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2023-TIOL-145-CESTAT-DEL
Cairn India Ltd Vs Asstt. Commissioner
CX - Appellant claims to produce oil by drilling - In process of manufacture/production of oil, plastic barrels in which input chemicals are procured arise as scrap - Further, due to wear and tear, pipes used in production of oil have to be replaced at times - Case of Revenue is that appellant is generating this scrap in process of manufacture of excisable goods namely oil and therefore, it is chargeable to excise duty - It is true that in case of production of oil, use of pipes is absolutely essential and without using such pipes final product namely oil cannot be produced at all - It is for this reason that pipes suffer considerable wear and tear and require replacing - What needs to be decided is, whether used/broken pipes which are generated as waste in this case arise out of process of manufacture or out of process of maintenance of capital goods - The distinction is subtle but clear - When some waste is generated in process of manufacture of goods it comes out of inputs directly or inputs transform into some form - Input is that substance or material which, after transformation, becomes the output - Pipes do not get consumed and do not get transformed into oil - They are used to manufacture/production of oil - Regardless of the fact that use of pipes is essential for production of oil, the pipes by themselves are capital goods and are not inputs - When such pipes need repair or replacing and waste is generated in process, it is a waste generated during repair or maintenance of capital goods and not during the process of production of oil or any process incidental or ancillary to it - For this reason, no excise duty can be charged on scrap of pipes produced in this manner - Similarly, the empty barrels are only packing material in which inputs are received and these barrels are not generated during process of manufacture - Therefore, no excise duty can be charged even on that scrap - Impugned orders cannot be sustained: CESTAT
- Appeals allowed: DELHI CESTAT
2023-TIOL-144-CESTAT-MAD
DCM Hyundai Ltd Vs CGST & CE
Cus - Appellant earlier was a 100% EOU and De-Bonded as per Ex-Bond Bill of Entry - They are engaged in manufacture and export of 'Marine Freight Container' falling under Heading 8609 of CETA, 1985 - Issue to be decided is whether appellant is liable to pay interest on duty paid on stock of raw material warehoused beyond the period of three years or whether SCN is time barred - CBEC Circular No. 10/2006 intends to give some solace to a 100% EOU by waiving liability of interest - The Chief Commissioner has however rejected this request of appellant - Be that as it may, SCN has been issued under Section 28 of Customs Act, 1962 - It is clear from said provision that SCN has to be issued within a period of six months - Impugned raw materials were imported between 1995 and 2003 - SCN is dated 13.10.2008 - The duty having been paid on date of De-Bonding the relevant date to compute the demand would therefore be the date of debonding, i.e., 31.03.2007 - The section does not speak of any extension of time based on a request for waiver - Further, request for waiver is filed as per Board Circular - Circulars, though binding on Department is not so on the Tribunal - SCN is time barred - Tribunal in case of Electronic Research Ltd. held that in absence of any limitation period for demanding interest in respect of Customs duty payable in term of Section 61(3) of Customs Act, 1962 in case of warehoused goods, limitation period would be the period prescribed in Section 28 ibid - Tribunal relied on the judgment in case of TVS Whirlpool Ltd - Demand of interest cannot sustain as SCN is time barred - Impugned order is set aside: CESTAT
- Appeal allowed: CHENNAI CESTAT
2023-TIOL-143-CESTAT-AHM
Gujarat Chemical Port Ltd Vs CCE & ST
ST - Issue involved is that whether appellant is entitled for Cenvat credit in respect of Management & Business Consultant service and Technical Inspection and certification service availed for purpose of proposed additional Jetty to be constructed adjacent to existing Jetty - Department has denied Cenvat credit on the ground that said services were used in connection with construction of a new Jetty which fall under 'setting up' of project which is excluded as per exclusion clause in definition of input services under Rule 2(l) of Cenvat Credit Rules, 2004 - Appellant already had Jetty in operation and they proposed to construct one more Jetty adjacent to existing Jetty - It cannot be said that appellant are setting up altogether a new Jetty - Additional Jetty is nothing but expansion of existing Jetty - Therefore, expansion, renovation or modernization of existing jetty, construction is still covered in inclusion clause of definition of input service under Rule 2(l) ibid - Even though setting up of a new factory, construction of building of service provider is not excluded from definition of Input service - In this case, construction of Jetty is clearly in nature of expansion of existing Jetty therefore, credit is clearly admissible - Accordingly, impugned order is set-aside: CESTAT
- Appeal allowed: AHMEDABAD CESTAT
2023-TIOL-142-CESTAT-MUM
Reliance Corporate IT Park Ltd Vs CCE
ST - In this appeal of appellant against upholding of recovery of CENVAT credit availed on mediclaim premium paid for procurement of 'insurance service' determined by original authority to the extent of coverage of persons other than employees which was allowed in impugned order, primary issue canvassed is judicial precedent in their favour - Dispute, having come up before Tribunal once before, had been remanded back on plea of appellant that computation was incorrect and of issues having been judicially decided in their favour - It is the grievance of appellant that no heed was paid to these in fresh proceedings - Reliance has been placed by both sides on decisions arising from dispute on availment of CENVAT credit by central excise assessees - There is a substantial difference between entitlement for availment of CENVAT credit for those entities in contradistinction with entitlement of service tax assessees - It is on the claim of entitlement, arising from direct or indirect use in manufacture and certain related services deployed in particular contexts, that these decisions had been rendered - It would, therefore, appear that disputed premia must be subjected to test of decision in re BNY Mellon International Operations (I) Pvt Ltd 2016-TIOL-1851-CESTAT-MUM as well as applicability of decision of Larger Bench of Tribunal in re Reliance Industries Ltd. 2022-TIOL-336-CESTAT-MUM-LB - There is also some misgiving about quantum of credit actually availed that has not been addressed by lower authorities - Accordingly, matter remanded to original authority for re-determination of credit disallowed in impugned order: CESTAT
- Matter remanded: MUMBAI CESTAT |
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