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PM-STIAC discusses accelerating Industry-Academia Partnership for Research and InnovationIndia, Singapore hold dialogue over cyber policy44 bids received under 10th Round of Commercial Coal Mine AuctionsCops arrest former Dy PM of Nepal in cooperative fraud casePuri highlights India's Petrochemical potential at India Chem 2024UN reports record high cocaine production in ColombiaMinister unveils 'Aviation Park' showcasing India's Aviation HeritageED finds PFI wanted to start Islamic movement in IndiaBlocking Credit - Rule 86ASEBI says investors can use 3-in-1 accounts to apply online for securitiesI-T- Penalty u/s 271(1)(b) need not be imposed when assessee moved an adjournment application & later complied with notice u/s 142(1): ITAT4 Kanwariyas killed as vehicle runs over them in Banka, BiharI-T- Accounting principles do not prescribe maintaining of a day-to-day stock register, and the books of accounts cannot be rejected on this basis alone: ITATUN food looted and diverted to army in EthiopiaCus - Alleged breach of conditions for operating public bonded warehouse; CESTAT rightly rejected allegations, having found no evidence of any such breach: HCUS budget deficit surges beyond USD 1.8 trillionST - Onus for proving admissibility of Cenvat Credit rests with service provider under Rule 9(6) of the Cenvat Credit Rules, 2004: CESTATIf China goes into Taiwan, Trump promises to impose additional tariffsRussians love Indian films; Putin lauds BollywoodCus - Classification of goods is to be determined in accordance with Customs Tariff Act & General Interpretative Rules; Country-of-Origin Certificate may offer some guidance, but cannot solely dictate classification: CESTATCus - Benefit of such Country-of-Origin certificates cannot be denied if all relevant conditions are met under the applicable Customs Tariff rules: CESTATCuban power grid collapses; Country plunges into darknessCus - As per trite law, merely claiming a classification or exemption does not constitute mis-declaration or suppression - any misclassification does not equate to willful intent to evade duty: CESTATKarnataka mulling over 2% fee on aggregator platforms to bankroll gig worker welfare fundCus - Extended limitation cannot be invoked in case of assessee who is a regular importer with a consistent classification approach: CESTAT
 
CENVAT - Revenue contention that applicant does not have any facility to manufacture excisable goods, hence cannot avail CENVAT - law allows import of by merchant exporter having supporting manufacturer - once duty has been paid, CENVAT credit cannot be denied - Stay granted: CESTAT

By TIOL News Service

MUMBAI, JAN 18, 2013: A sizeable number of cases emanating from the Central Excise Commissionerates nowadays relate not to the fact that the assessee has not paid any Central Excise duty or there is any undervaluation but that the assessee should not have paid any duty by taking CENVAT Credit.

The present case is one of such kind.

The applicant is a merchant exporter and the imported raw material was supplied to M/s Maharashtra Seamless Ltd. under rule 4(5) of the CENVAT Credit Rules and the goods were manufactured and thereafter the applicant paid duty by utilizing the CENVAT credit as well as paying from PLA.

The CCE, Raigad has denied CENVAT credit of Rs.2,78,77,385/- availed on the inputs on the ground that the applicant has no facility to manufacture the excisable goods, therefore, the applicants have wrongly availed the credit.

Before the CESTAT, the applicant submitted that they are merchant exporters and the imported raw material was supplied to M/s Maharashtra Seamless Ltd. under rule 4(5) of the CENVAT Credit Rules and the goods were manufactured and thereafter the applicant paid duty by utilizing the credit as well as paying from PLA; that the duty paid is much more than the credit now being denied; that the contention is that Notification 53/2003-Cus under which the goods have been imported, allows the import of raw material by a merchant exporter having supporting manufacturer whose name and address is specified on the licence; that the applicant disclosed the name of supporting manufacturer and the goods were manufactured by the supporting manufacturer and duty was paid by the applicant, hence the demand is not sustainable.

The Revenue representative had a one line submission - the applicant has no facility to manufacture the goods and, therefore, the credit in respect of the raw material is not available to the applicant & the demand is rightly made.

The Bench observed -

"5. We find that the applicant had paid the duty which is more than the credit now being denied. Further, we find that the Hon'ble Bombay High Court in the case of CCE, Pune-III vs. Ajinkya Enterprises reported in = (2012-TIOL-578-HC-MUM-CX), held that once the duty on final product has been accepted by the Revenue, in such a case the credit cannot be denied. In view of the above, as the applicant had paid more duty than the credit now being denied, pre-deposit of the dues is waived and recovery of the same is stayed during the pendency of the appeal. The stay petition is allowed."

In passing: Time to put an induction & thermal mechanism into operation - See 2012-TIOL-929-HC-AHM-CX.

(See 2013-TIOL-116-CESTAT-MUM)


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