cestat ruling (central excise) · m/s dee sons silk mills pvt ltd vs cce (dated: february 12, 2016)...

CESTAT RULING (CENTRAL EXCISE)

2016-TIOL-778-CESTAT -DEL

Diamond International Pvt Ltd Vs CCE (Dated: November 27, 2015) CX - Assessee engaged in manufacture of footwear and claimed exemption from duty on ground that footwear are made exclusively of plastic material in terms of notfn 18/2001-CE - Explanation-I inserted vide notfn 30/2001-CE was merely to remove doubts to effect that if materials other than of plastic like buckles, tabs, eyelet stays or in-soles are used, footwear still shall be deemed to be made exclusively of plastic materials - Board's Circular dated 30.05.2001 clarified that expression "footwear made of plastic materials" should be given its normal meaning - No allegation that footwear made by assessee were not of plastic materials - Exemption is rightly available to assessee: CESTAT

2016-TIOL-777-CESTAT -AHM

Alliance Fibres Ltd Vs CCE & ST (Dated: January 6, 2016)

CX - Exemption under Notfn 12/2012-CE and Notfn 89/95-CE - Assessee engaged in manufacture of Polyester Staple Fibre (PSF), Polyester Oriented Yarn (POY) and PSF waste and POY waste - Benefit of exemption under said notfns denied on ground that notfn exempts PSF only and POY, POY waste and PSF waste are different goods - PFY as mentioned in exemption notfn, would also cover POY as per report of DSIR - As regards to demand of duty on waste of PSF and POY, Tribunal already remanded this matter for examination of this issue in light of exemption notfn - In earlier case, de-novo adjudication is still pending - So, it is appropriate that this issue should be remanded to Adjudicating authority - Demand of duty alongwith interest on POY is set aside - Penalties are also set aside: CESTAT

2016-TIOL-774-CESTAT -ALL

M/s Bajaj Hindustan Ltd Vs CCE (Dated: November 30, 2015) CX - Whether assessee is entitled to Cenvat credit on items, like, Hot Strip Mill Plates, Flat, STRL, Plate and Mill Plates falling under Chapter 72 of CETA, 1985, wh ich were utilized in fabrication of Bio -Gas Plant-a Pollution Control Equipment - Goods in question were used in fabrication of biogas plant - As bio -gas plant is a pollution control equipment defined in rule 2 (a)(A)(ii) of CCR, 2004, assessee have rightly taken credit, being entitled to same - In case of assessee, manufacture cannot take place of excisable goods being Sugar, without repair and maintenance of capital equipment like sugar Cane cutter, It is held that assessee is entitled for cenvat credit on same - Impugned order set aside: CESTAT


M/s Dee Sons Silk Mills Pvt Ltd Vs CCE (Dated: February 12, 2016) CX - Utilisation of cenvat credit taken on AED (T&TA) for payment of basic excise duty on clearance of final product from factory - Such utilization is not permissible in law in view of embargo created in rule 3 (6) (b) of CCR, 2002 - There is no merit in case of assessee towards utilization of cenvat credit taken on AED (T & TA) for payment of

BED - As assessee had maintained proper records showing availment and utilization of cenvat credit on such disputed duty, taking of such credit of AED (T&TA) and utilization towards payment of BED is not attributable to fraud, collusion or any willful misstatement with intent to evade payment of Duty - Since, information regarding taking of cenvat credit on disputed duty amount and utilization thereof was within knowledge of Department, proceeding initiated for recovery of wrongly availed cenvat credit alongwith interest and imposition of penalty by invoking extended period of limitation is not justified: CESTAT

2016-TIOL-770-CESTAT -MUM

CCE Vs Bombay Oxygen Corporation Ltd (Dated: March 2, 2016)

CX - Valuation - s.4 of CEA, 1944 - From the appeal memorandum filed by revenue it appeared that the order of Commissioner has been accepted insofar as the revision of rent for the purpose of addition to the assessable value is concerned and accordingly the demand had been re -calculated - Appeal questions correctness of dropping the demand of Rs.1,76,573/- and also dropping the proceedings in respect of recovery of interest, imposition of penalties and confiscation of goods etc. - As dispute involved is of an amount less than Rs.10 lakhs while the EA-3 Form wrongly mentioned the same as Rs.99,41,351/-, in view of the new litigation policy dated 17.12.2015 revising monetary limits for filing appeal, Revenue appeal dismissed: CESTAT [para 3, 4]

Also see analysis of the order


CCE Vs Kuber Tobacco India Ltd (Dated: March 4, 2016)

CX– Clandestine removal of “Gutkha” – Department alleging that M/s. Kuber is engaged in the activity of unaccounted manufacture of 'Kanchan/Kanchann' brand gutka and 'wiz' brand pan masala by clandestinely installing and operating FFS machines from an undeclared and unregistered premises of Sandeep Poultry Farm; statements recorded; Revenue contends that that CE duty is payable under compounded levy scheme; demand of duty of Rs.1,77,75,000/- [Period September 2008 to November 2008] was confirmed alongwith interest and equivalent penalty & penalties on various persons including Director; demand dropped for the month of August 2008 – Both, appellant & Revenue in appeal before CESTAT – Appellant assessee contending that they were not involved in the activity of manufacture of gutkha and the said activity was illicit and misuse of their brand name and goodwill by certain elements who were manufacturing duplicate goods bearing M/s. Kuber brand names and clearing them in the market; that the statements recorded during the course of investigation cannot be relied upon as admissible evidence in terms of the provisions of section 9D of the CEA, 1944.

Held: It is clear that during adjudication, the adjudicating authority is required to first examine the witness in chief and also to form an opinion that having regard to the facts and circumstances of the case, the statements of the witness are admissible in evidence. Thereafter, the witness is offered to be cross-examined - In the absence of examination in chief, allowing the cross examination, is a futile exercise - appellant have challenged the impugned order on the ground that the evidence in the form of statements gathered have no link of the appellant to the activities that took at Sandeep Poultry Farm which is required to be examined on the basis of records available during the course of adjudication and the same has not been considered judicially – Order set aside & adjudicating authority is at liberty to re-adjudicate the matter after following the procedure laid down under section 9D of CEA, 1944: CESTAT [para 14, 15]

2016-TIOL-768-CESTAT -MAD

India Cements Ltd Vs CCE & ST (Dated: December 31, 2015) Central Excise - Welding electrodes used in repair and maintenance of plant and machinery which in turn used for manufacture of final product - Held eligible for Cenva t credit as input/capital goods -Order denying credit unsustainable hence set aside. (Para 5)


Hyundai Motor India Ltd Vs CCE (Dated: October 7, 2015) Central Excise - CENVAT credit - appellant availed input services credit under Rule 2(l) of the CCR 2004, on outward transportation of finished goods up to the port of exportation; tax paid on CHA / wharfing charges - Revenue viewed the same inadmissible, denied the credit, confirmed demand for its recovery, and imposed penalty in adjudication, agitated herein.

Held: Under Rule 2(l), the input service definition also covers the inclusive portion services which involve activities relating to business and also outward transportation up to place of removal - The Commissioner's finding that these services are not related to manufacture, as transportation up to the port for exports is a post sale transportation, cannot be sustained in view of the definition which covers broadly any input service in relation to even clearance of the final products from the place of removal and outward transportation of goods up to the place of removal - Para 6 of the Board Circular dated 28.02.2015 clarifies that the port is the place of removal for exports; same squarely applicable to the facts of this case and this instruction is binding on the department - Port is to be construed as the ‘place of removal' for the purpose of exports; customs house agent service and wharfage charges, are eligible for cenvat credit in view of the nexus in existence between the goods manufactured and the services under dispute which are essential for export - the appellants are eligible for cenvat credit on GTA, CHA and wharfage charges; impugned order set aside. [Para 5, 6, 9, 10]


Beekay Steel Industries Ltd Vs CCE & ST (Dated: December 18, 2015) Central Excise - Cenvat credit on welding electrodes used in the manufacture of finished goodsfollowing established precedents - Allowed.

Appellants are manufacturers of 'Non-alloys and Alloys', Bright bars falling under the chapter heading No. 72 of the CETA, 1985 and are availing Cenvat credit on welding electrodes used in or in relation to the manufacture of finished goods. The period involved is from April, 2008 to July, 2010. Periodical SCNs were issued to the appellants objecting Cenvat credit availed on welding electrodes. The adjudicating authorities below held that since the welding electrodes is used for working on Capital goods, the same will not qualify for 'Input' and accordingly it will not qualify for Cenvat credit under Cenvat Credit Rules, 2004. On appeal, the Commissioner (Appeals) upheld the order of the adjudicating authority resulting in the present appeal.The appellants have been using the impugned goods as input for pass racking material catching in the roll which determines the shape of the final products. Further, the said electrodes have been used in the Guide Box for fabrication to separate the roll pass at the entry of Heated Billets in the manufacturing process. Thus the usage of the said welding electrodes was for repairing rolls which are vital capital goods used directly in relation to the manufacture of final products.

As is clear from various citations of High Courts and of Tribunals placed before the

CESTAT Cenvat credit on welding electrodes used in or in relation to the manufacture of finished goods was clearly allowed. By respectfully following the High Court's decision, the assessee is eligible for availing Cenvat credit on welding electrodes used in or in relation to the manufacture of finished products.The cases relied upon by the Revenue are not relevant in view of the jurisdictional High Court of Madras decision and other Hon'ble High Court orders as discussed, thus the impugned order is not sustainable. The same is set aside and accordingly the appeal is allowed. (Para 6, 7)


OPG Metals Pvt Ltd Vs CCE (Dated: July 16, 2015) Central Excise - Job work - Conversion of scrap waste into ingots - Limitation - Contract stipulated that Principal arranged supply of imported scrap waste directly to job worker for conversion into billets/ingots - Conclusive proof available from correspondence demonstrates that jurisdictional authorities were clearly informed about appellant carrying out job work and have sufficient knowledge that job worker wasin receipt of scrap directly from point of import and conversion into billets/ingots as per conversion agreements to their principal suppliers - Question of suppression of material facts does not arise - Extended limitation period not available - Demand held hit by bar of limitation.

On perusal of records and correspondence, Revenue's plea that the Department came to know only upon scrutiny of ER-1's is wholly unacceptable. In the letter addressed by the appellants they have clearly informed that on the activity of conversion of MS scrap into MS ingots under rule 4 (5) (a) of CCR wherein they have clearly stated that after conversion MS ingots as billets will be returned to principal supplier and on perusal of the invoices of the appellant under Rule 11 of CER where appellant clearly mentioned that the goods were "sent for conversion under Rule4 (5) (a)". Appellants have thus informed the concerned jurisdictional authorities at every stage about their carrying out the job work and receipt of MS scrap and conversion into billets and ingots as per conversion agreements to the principal suppliers. Therefore, it has to be reckoned that appellant has not suppressed any facts particularly to the fact that the said letters were duly received by the jurisdictional authorities and there was no objection ra ised by the authorities and no verification was done treating that it is only intimation. This is further supported by the evidences that both the internal audit and by the CAG Audit who verified the records, returns and invoices periodically and accepted the clearance. Therefore, it cannot be said that the Revenue has come to know only after jurisdictional Superintendent's letter. Therefore, the fact of receipt of scrap for conversion and return to the principal manufactures are clearly known to the department and there was no suppression of facts by the appellant.Even otherwise, as the Supreme Court held mere omission to give correct information is not suppression of facts unless it was deliberate to stop the payment of duty. Thus seen, extended limitation period cannot be invoked consequently the demand is hit by bar of limitation. (Para 14, 15)

Central Excise - Job work - Scrap sent to job worker under provision of Notification No.214/86 -Scrap received from the supplier got converted into MS ingots and duly returned to the principal manufacturer on payment of duty- No input credit availed by job worker - No excise duty payable by job worker including on scrap generated at job work location,demand hence unsustainable.

It is pertinent to see that both the appellant and the principal suppliers are duly registered with the Central Excise and following Central Excise procedures. The principal manufacturers duly declared/intimated to the department that raw materials were being sent for conversion under Rule 4 (5) (a) as evident from the correspondences, invoice and DC and other documents. Being a central excise manufacturer the principal manufacturer is entitled to send raw material as such or for further processing under Rule 4 (5) (a). The rule includes the term "removal of raw materials for further processing" and the department is not disputing that the

goods are not returned by the appellant after conversion. The appellant also produced copies of Form -4 evidencing receipt of MS ingots/billets by the principal manufacturer. All these facts conform that appellant being a job worker received MS scrap as per the conversion agreement duly converted in the ingots and billets and cleared the same to the respective principal supplier. It is not the case of the department that finished goods not suffered duty or cleared without payment of duty. It is also on fact that scrap received from the supplier got converted into MS ingots and duly returned to the principal manufacturer and there is no direct sale of MS ingots or billets of job work goods directly by the appellant after the conversion scrap received from the supplier.It can thus be seen that the principal supplier filed declaration/intimation as per Notification 214/86before ACCE, Salem instead of filing with the jurisdictional ACCE Karaikal. Therefore, it is not the case of non-compliance. It can also be seen that it is revealed that goods are cleared after conversion under Rule 4 (5) (a). On facts held that failure to file declaration/undertaking of raw material supplier, cannot be a ground to deny the benefit of notification No.214/86.

Further the Board's circular dt.20.4.1997 categorically clarified that as per provisions of Rule 4 (5) (a), the manufacturer can get the job work done on the inputs in terms of provisions of Rule 57F (4) of CCR. In this context, the duty liability is required to be discharged by the principal manufacturer and not by the job worker. Evidence indicates that no input credit has been availed by the job worker. Revenue contended that Rule 4 (5) (a) of CCR is not applicable on the ground that principal supplier has not availed credit. The scrap was directly sent from the port of import to the job worker and the principal supplier has availed credit immediately on receipt of MS ingots and billets from the job worker. There is no restriction on the manufacturer to send raw material directly from the place of import to the job work premises. Therefore, there is no dispute on the receipt of scrap and clearance of MS ingots/billets to the principal supplier, the question of demanding duty on the job work does not arise. In view of the foregoing discussions the demand of excise duty on the job worker i.e. appellant is not sustainable both on limitation and on merits.Impugned orders of demand and penalty set aside and appeals allowed with consequential relief. (Para 16-19)


Garden Silk Mills Ltd Vs CCE (Dated: February 3, 2016) CX - Although the assessee sought for separate registration for their different divisions/factories/units on 15.04.2005, they were given the same only on 23.09.2009 by the Dy. Commr. - For the interregnum period, the assessee cannot consider themselves as separate units - maintenance of a single CENVAT account & utilization of CENVAT credit from a common pool cannot be objected to - Appeals allowed: CESTAT [para 19, 20, 21, 24, 25]


2016-TIOL-759-CESTAT -BANG

Geltec Pvt Ltd Vs CCE, C & ST (Dated: January 13, 2016) Central Excise - Valuation - Physician Samples - Appellant manufactures physician samples and sells them to the brand owner and pays duty on them based upon the transaction value agreed as per the terms with the brand owner - Revenue took view that such transaction value is incorrect and duty is to be paid on the pro -rata value of the sale pack of the samples since pharma products are covered by MRP - Issue is no more res integra in view of the precedent decision of Supreme Court which held that the case would squarely be covered under the provisions of Section 4(1)(a) i.e., basedupon transaction value- Hence, impugned order set aside - Appeal allowed - Central Excise Act, 1944. [paras3, 4, 5]

2016-TIOL-758-CESTAT -BANG

CCE, C & ST Vs Indian Telephone Industries Ltd (Dated: February 2, 2016) Central Excise - Provisional Assessment - Adjustments - Appellant cleared goods on provisional assessments and upon their finalization, in some cases duty was paid in excess while in some cases it was short paid - Revenue took view that in the cases of short payments, duty has to be paid and for excess paid duty, refund claim has to be filed - Commissioner (A) held that the excess paid duty is required to be adjusted against the short payments and as the excess paid duty was more than the duty short paid, neutralized the same and advised appellant to file refund for the balance - Revenue contends that suo motto adjustments by appellant is not proper and in the cases of excess paid duty, it appears that the burden has already been passed on to customers and there was no proof in contrary - In view of the precedent decision which held that assessee is entitled for adjustment of excess paid duty with the short paid duty during the period of provisional assessment, upon finalization of assessment, no reason to interfere with the impugned order - Revenue's appeal dismissed. [paras 2.1, 2.2, 3, 4]


CCE Vs Emerson Process Management Ltd (Dated: January 6, 2016) Central Excise - Remission - Defective output: Revenue's appeals are against order of Commissioner (Appeals) who held that the respondent is entitled to the remission of duty in view of contingency that gave rise to the defective output in the process of manufacture. The Commissioner (Appeals) has recorded the examination conducted by the adjudicating authority and found that he was satisfied. He has also examined the allegation in the show cause notice and he noticed that the goods before reaching to the final stage was defective for no reason attributable to the respondent.The reasoned order of the Commissioner (Appeals) as above does not call for reversal of his decision.


CCE Vs M/s Punikim (Dated: March 2, 2016) CX - Respondent engaged in process of pleating and embossing of duty paid processed fabrics - processes were exempted by notfn. 6/2002-CE, Entry no. 102 and withdrawn by notfn. 6/2003-CE dated 01.03.2003 [w.e.f 01.04.2003] and then again extended by notfn. dated 01.10.2003 - Duty demand raised for the intervening period - demand confirmed by Addl. Commr. but set aside by Commissioner (A) on the ground that the processes are temporary in nature and did not amount to manufacture and further that duty if any can be demanded only from the supplier of the raw materials u/r 12B of CER - Revenue in appeal before CESTAT.

Held: It is seen that the Revenue appeal covers only the first ground and there is no argument whatsoever on the second ground on which demand was dropped - so prima facie, even if the appeal of the Revenue is allowed on the first ground, no relief can be granted on the second ground - It is also clear that only processes which result in permanent change in the processed fabrics could amount to manufacture - in absence of any evidence to the effect that pleating and embossing results in a permanent change in the fabrics, Bench is unable to differ with the orders passed in Ronuk Mfg. Co. - 2004-TIOL-933-CESTAT -MUM & J.S. Knitters - 2005-TIOL-237-CESTAT -MUM - Revenue appeals dismissed: CESTAT [para 4.3, 4.4, 5]


Indo Rama Synthetics India Ltd Vs CCE (Dated: February 26, 2016) CX - Appellant received inputs, namely furnace oil and other lubricant mineral oil and availed CENVAT credit - such inputs were stored in a tank - during course of storage of these oils, some portion of these inputs remain in storage tank as sludge which are sold as furnace oil sludge and mineral oil sludge without payment of CE duty - Revenue demanding duty/cenvat credit and which was confirmed along with interest and penalty - appellant before CESTAT. Held: Provision of rule 3(3) of CCR invoked by Revenue are not applicable as it is not an input removed by assessee as such - it is sludge which gets settled at the bottom of the storage tank which is considered as waste and removed - In view of Tribunal decision in appellants own case - 2007-TIOL-2021-CESTAT-MUM & Board Circular 84/2/86-CX.3 dated 23.03.1987, order of Commissioner (A) confirming the demand is not sustainable and consequently set aside - appeal allo wed with consequential relief: CESTAT [para 7, 8]


Kopran Ltd Vs CCE (Dated: February 26, 2016) CX - Appellant, a manufacturer exporter of medicaments, was availing CENVAT Credit of duty paid on inputs used in manufacture of final products and claimed refund of Rs.91,66,073/- under Notfn. No. 27/2012-CE (NT) dated 18.6.2012 - lower authorities rejecting the claim on the ground that the appellant had failed to follow the conditions of sr. no. 'h' of notification i.e. failure to debit the amount that is claimed as refund under rule 5 of CCR, 2004 at the time of making the claim - appeal to CESTAT. Held: Matter is squarely covered by the Tribunal decision in Sandoz Pvt. Ltd. - 2015-TIOL-2076-CESTAT-MUM where it is held that failure to debit on the date of filing the refund claim is not such a lapse that it would debar the appellants from the refund - Order set aside and appeal allowed: CESTAT [para 4]


Empire Industries Ltd Vs CCE (Dated: February 2, 2016) CX - Appellant had taken CENVAT credit on the goods imported under Duty Free Import Authorization (DFIA) Scheme and SCN was issued proposing denial of the same on the ground that para (v) of the Notfn. 40/2006-Cus mentioned that for exports under DFIA the facility of CENVAT credit under CCR in respect of materials imported/procured against the said authorization cannot be availed - however, in adjudication, the credit was disallowed by referring to para (iiia) of the notification - as Commissioner (A) upheld this order, appeal filed before CESTAT. Held: It is not permitted in law to adjudicate the matter in the SCN on the ground which is not flowing from the SCN - adjudication order or appellate order is not permitted to travel beyond the scope of the SCN - nonetheless, retrospective amendment has been made in para (v) substituting the earlier content (which prohibited availment of CENVAT credit) & which has been validated for the period from 1 st May 2006 to 18 th February 2009 and, therefore, the appellants are entitled for CENVAT credit - availment of credit in respect of SAD paid on the imports made under DFIA becomes legal and correct in view of the retrospective amendment - Order set aside and appeal allowed: CESTAT [para 5, 6]


CCE Vs Bharat Parabolic Springs Pvt Ltd (Dated: February 5, 2016) CX - CENVAT credit denied on the ground that respondent availed credit on the photocopy of the Bill of Entry and which is allegedly not a prescribed document u/r 9

of CCR - Commissioner (A) allowing appeal of respondent assessee, so Revenue before CESTAT. Held: Respondent have initially availed credit mentioning the details of the Bill of Entry - Subsequently, on pointing out by Audit, they produced invoices issued by M/s Tata Motors Ltd., the importer, and which is a valid CENVATAble document - Commissioner (A) also calling for a report from the jurisdictional authorities and which confirmed the receipt, issue and use of the imported goods on which credit was taken in the production of final products out of the said inputs - no reason for denying the credit - Order upheld and Revenue appeal dismissed: CESTAT [para 5]

2016-TIOL-744-CESTAT -KOL

Indian Rare Earths Ltd Vs CCE & ST (Dated: February 29, 2016) CX - Processes undertaken by the appellant on sand ores like washing, magnetic separation, gravity separation to remove unwanted matters result into conversion of ores to concentrate and which activity is ‘manufacture' in view of Ch. Note 4 to Ch. 26 - Matter remanded for considering eligibility of exemption under notfn. 63/95-CE: CESTAT [para 5.22, 5.27, 5.29, 5.31]



CCE Vs M/s Mather Platt Pumps Ltd (Dated: January 6, 2016) CX - Whether the supply made to SEZ developer for their authorized office can be treated as export and secondly whether demand of 10% of the value of the goods in terms of rule 6(3)(i) of CCR, 2004 is correct and legal or otherwise? Held: Issue is no more res integra - it is settled by various Tribunal and High Court judgments that even prior to amendment Notification 50/2008-CE (NT) , dated 31.12.2008 supplies made to SEZ developer has been treated as export and accordingly, manufacturer/supplier need not to pay 10% in terms of rule 6(3)(i) of CCR, 2004 - Order of Commissioner (A) is upheld and Revenue appeals are dismissed: CESTAT [para 6]


CCE Vs Mega Rubber Technologies Pvt Ltd (Dated: December 30, 2015) CX - CENVAT - Respondent assessee received rejected articles of rubber back from their customer and availed CENVAT credit in terms of rule 16 of CER - assessee tried to reprocess the said returned goods but on occasions the activity resulted in scrap which was cleared on payment of duty on the scrap value - Revenue sought reversal of the credit availed but Commissioner (A) dropped the proceedings initiated for recovery - Revenue appeal to CESTAT.

Held: The procedure followed by the assessee of paying duty on scrap value is the correct position in law - analogy can be derived from the case when inputs are issued to the job worker for manufacturing and the activity resulted in scrap and which is cleared on payment of duty on scrap value - order passed by lower appellate authority is correct, hence Revenue appeal disallowed to this extent: CESTAT [para 6.1]

CX - Revenue wants appropriation of the Value of moulds used by respondent in manufacturing final products for customers and payment of duty thereon - Respondent has emphasized that they have discharged CE duty on the cost of moulds

recovered from the customers and which factual aspect is not disputed by Revenue - if it is the case of the Revenue that the amortization of the cost of moulds is nothing but to collect CE duty on value of such moulds, then the same has already been done so by the assessee - when CE duty is paid on moulds at one time or recovered by amortising the cost of goods produced, it is the same i.e duty on value of moulds is recovered - impugned order proper & legal, hence Revenue appeal rejected: CESTAT [para 6.2]


Kec International Ltd Vs CCE (Dated: January 1, 2016) CX - Delay of one day in filing appeal could have been condoned by the Commissioner (A) even without an application having been filed seeking condonation - furthermore, since the lower appellate authority has not decided appeal on merits, order set aside and matter remanded for a decision in accordance with law - Matter remanded: CESTAT [para 5]


Mahindra Hinoday Industreis Ltd Vs CCE (Dated: February 15, 2016)

CX - Whether the appellant being principal supplier and manufacturer of final product is liable to pay excise duty on the waste and scrap arising during the job work in the premises of manufacturer of intermediate goods. Held: Since the job worker is manufacturer, excise duty liability, if any arises, will be on job worker and not on principal manufacturer i.e. appellant who supplied inputs - Order set aside and appeal allowed: CESTAT [para 3]


CCE Vs Waluj Components Pvt Ltd (Dated: January 28, 2016) CX – Appellant manufacturing Juicer attachment and classifying the same under Heading 8509 of CETA, 1985 and assessing the same u/s 4A of the CEA, 1944 – Revenue alleged that the goods are rightly classifiable under heading 8548 and not entitled for assessment u/s 4A of CEA, 1944 – SCNs dropped by original authority and in Revenue appeal these orders were upheld – Revenue in appeal before CESTAT.

Held: A comparison of the contending entries indicates that only "Electrical parts" can be classified under heading 8548; there is no assertion that the juicer attachment contains any electrical parts and, therefore, heading 8548 does not appear to be the correct heading – further explanatory note to HSN does not leave any doubt that the said mixer would be classifiable under heading 8509 – Order of lower appellate authority is upheld - Revenue appeal dismissed: CESTAT [para 4]


CCE Vs Cognizant Technology Solutions Pvt Ltd (Dated: January 12, 2016) CX - Whether the respondent, a 100% EOU/STP Unit is entitled for exemption Notification No. 1/95-CE dated 4/1/1995 and Notification No. 140/91-Cus dated 22/10/1991 in respect of goods namely Nordialite large (12 ft pole with terminal block), Methallide control gear for NP-3L, Planter up lighter and Armstrong mineral fiber sound absorbing sheets and steel angle suspended system, MS ERW pipe black steel tube for which permission has been given by the Director, STPI for procurement

- Adjudicating authority denied the exemption on the ground that the goods procured by the respondent are not used for development of software - Commissioner (A) setting aside the order on the ground of time bar as well as on merits - Revenue in appeal before CESTAT. Held: On going through the contents of the notifications, it is observed that there is no condition that the goods so procured should be used in the development of software - fact of installation/use of the goods in the premises of the respondents has not been disputed - Commissioner (A) has rightly allowed the exemption by proper application of mind - order is maintained and Revenue appeal is dismissed: CESTAT [para 7]


CCE Vs M/s Akash Ispat Ltd (Dated: January 14, 2016) CX - Assessee engaged in manufacture of M.S. Ingots - Short payment of duty alleged on goods cleared to related buyers - Revenue views that all buyers are inter-connected with assessee - Provisions of MRTP Act talks about inter-connectivity between two body corporates - It is an admitted fact that four out of five buyers are proprietory concerns and assessee is a Public Limited Company - Revenue relied on provisions of Rule 9 without specifically alleging that all goods manufactured by assessee are sold, to or through these purported related persons - As per Section 6 of Companies Act, a corporate entity, assessee being a Public Limited Company, cannot fit into being called a "relative" in this context - Understanding by Revenue is due to mixing up of "related person" with "relative" - The submission that profit accruing from sale through related persons goes to same family or relative is without any factual support and in any case assessee being Public Limited Company, profit, if any, should flow to all share holders - No reason to interfere with impugned order, same is upheld: CESTAT


Vernerpur Tea Estate Vs CCE & ST (Dated: February 29, 2016) CX - Limitation - Refund under Notfn 33/99-CE - Whether refund claims filed by assesses, after a period of more than 5 years from date of payment of duty, are admissible or not - It is case of Revenue that no refund claim has been filed by assesses under Notfn 33/99-CE which should be filed in form of a statement upto 7th of next month under clause 2 (a) of notfn - Eligibility under clause 3 (b) of said Notfn does not mean that refund claim/statements can be filed after any length of time - For this purpose such refund claim/statements as prescribed in clause 2 (a), are required to be filed by 7th of next month - RT-12 returns of assesses cannot be considered as appropriate statements under clause 2 (a) of said Notfn - There is no confusion in provisions contained in clause 3 (b) of exemption notfn that substantial expansion of 25% should be by installing brand new machinery only - Thus, there was no justifiable reason to file substantial expansion applications after 5-6 years of actual expansion done and seek retrospective refund claims - Specific time limits have been prescribed under said Notfn for filing a refund statements under clause 2 (a) - Provisions of Section 11B of CEA, 1944 are not applicable to refunds arising out of said exemption Notfn 33/99-CE because specific monthly time limits have been prescribed under this notfn - Accordingly, refund claims filed after more than 5 to 6 years of such duty payment, are clearly time barred: CESTAT


Tata Iron And Steel Co Ltd Vs CCE (Dated: February 24, 2016) CX - Assessee engaged in manufacture of iron and steel products - Saddles were

fabricated inside factory premises of assessee and said fabrication was carried out by two contractors/fabricators, and fabricated saddles were later grouted to earth by another contractor - All raw materials and consumables were supplied by assessee to fabricators - "Saddle" is a common name known to market and fact that it is not brought and sold in market could not in any manner diminish its capability of being marketable which is evident from fact that assessee themselves use said saddle in railway wagons for carrying HR coils, and for such use they consider it as marketable commodity and discharge duty accordingly - Tribunal has no hesitstion to hold that assessee are manufacturer of saddles.

Benefit of Notfn 61/90-CE and Notfn 41/94-CE - Sole object for which saddles were fabricated was for its use in storage of HR coils in factory premises and grouting has been done by fixing with nuts and bolts only for purpose of making it sta tionery, hence, such grouting cannot be considered as construction work - Assessee also failed to substantiate their claim on exemption from duty on saddles under said two Notfns.

Limitation - Assessee is required to disclose true description of goods and its classification would be determined on basis of said declaration vis-a-vis entries of respective chapter headings/sub-headings - Saddles when manufactured and fitted to Railway wagons appropriate duty was paid but when used in factory for same purpose treated as non dutiable without any valid reason - Therefore, fact of manufacture and use of saddles in factory premises were not disclosed in respective classification list, therefore claim of assessee that all facts were within knowledge of department and no facts were suppressed cannot be sustained - Consequently, extended period of limitation is applicable.

Saddles are excisable goods and assessee being manufacturer of same, non payment of duty on same, liable for confiscation and imposition of penalty but quantum of same cannot be enhanced in de novo proceeding - Since, assessee are eligible to MODVAT Credit on duty paid inputs used in manufacture of 240 no. of saddles and for determination of exact amount of credit, matter is remitted to Commissioner; thus, penalty and fine be accordingly determined thereafter: CESTAT


Johnson Lifts Pvt Ltd Vs CC & CE (Dated: February 19, 2016) CX - Valuation - Appellant well in advance informed the department for their option of provisional assessment as per rule 7 of CER, 2002 - appellant paid duty on provisional price at the time of clearance in the year 2006-07 - at the time of audit in September 2007, final cost audit report was not available and for that reason the appellant did not pay the differential duty - however, as pointed out by the audit team, appellant paid diffe rential duty on a bonafide belief that excess duty paid can be adjusted against short paid duty - later, demand notice issue for short paid duty - Department should have issued SCN within one year from the date of payment of differential duty i.e. from September 2007 - as cause of action started from the date when the differential duty was paid by the appellant, nothing prevented the department to issue SCN within one year from the date of payment of excise duty - as there is no suppression of fact, fraud, mis -statement etc. on the part of the appellant, therefore, demand is patently time barred - Order set aside on ground of limitation - Appeal allowed: CESTAT [para 5]


Century Metal Recycling Pvt Ltd Vs CCE (Dated: December 04, 2015)

Central Excise - Aluminum alloy ingots, scrap - Demand based on clandestine manufacture and removal - Initial burden is on Revenue - Duty paying documents and

stock verification by revenue demonstrated no evasion of duty or excess of finished goods vis -à-vis stock of raw materials - Absent tangible evidence of quantification of raw material receipts vis-à-vis finished goods, corroborative evidence, cross examination etc, demand merely based on bald allegations of wrong availment of CENVAT credit without receipt of raw materials and their use by appellant and clandestine removal of finished products thereafter, held unsustainable and set aside.



CCE Vs Candico (I) Ltd (Dated: February 26, 2016) CX – Respondent acquired capital goods from their principals M/s. ITC Ltd. for carrying out the job work on lease basis - they were paying lease rent towards the use of capital goods to M/s. ITC Ltd. – SCN issued proposing disallowance of the credit on such capital goods on the ground that though the respondent has acquired the capital goods on lease, the same is not from a financing company but from M/s. ITC Ltd. – Credit denied by adjudicating authority on the ground that rule 4(3) of CCR was not complied with – Commissioner (A) setting aside this order by relying on the judgment in German Remedies Ltd. 2002-TIOL-30-CESTAT -MUM - Revenue in appeal.

Held: Upon reading rule 4(3) of CCR, 2004, whether the capital goods are supplied by a financing company or otherwise is not significant for deciding admissibility of CENVAT credit – so long as the capital goods were received and used in the manufacture of goods, credit should be allowed as per normal provisions of CCR, 2004 – Commissioner (A) has rightly relied upon the decision in German Remedies Ltd. (supra) – Revenue appeal dismissed: CESTAT [para 5]


Rungta Mines Ltd Vs CCE, C & ST (Dated: February 29, 2016) CX - By virtue of ch. note 4 in ch. 26, a legal fiction has been created bringing such processes into the fold of the definition of manufacture, which otherwise in common parlance would not be considered as manufacture - application of processes of crushing, grinding, screening and washing and grading of iron ore, converts it into iron ore concentrates and accordingly is leviable to CE duty - Matter remanded in some appeals to decide the eligbility of exemption notification notification 63/95-CE - Penalties not imposable u/s 11AC of CEA, 1944 as matter concerns interpretation of law and involves normal period: CESTAT [para 15.30, 15.31, 15.32, 15.33]



Hinduja Foundaries Ltd Vs CCE (Dated: November 19, 2015) Central Excise - CENVAT credit - appellant, engaged in the manufacture of Cast articles of Iron and Aluminium for use in Motor vehicles, availed credit on excise duty paid on Angles, Channels, Bars etc., which are principally used in the construction of factory shed, building or laying of foundation or making of structures for support of capital goods - credit denied in adjudication in terms of Rule 2(k) of CCR 2004, demand for recovery of the same with interest and penalty under Rules 14 & 15 of the CCR, 2004 read with Sections 11 A(1) & 11AC of CEA, 1944 confirmed -

Commissioner (Appeals) upheld the demands, and now agitated herein.

Held: In terms of Tribunal's Final order No. 40332/2015 dated 20.03.2015, in the appellant's own case, both sides have not considered various decisions of the Apex Court and various High Court pronouncements on the issue of credit availed on MS Angles, channels etc. - taking into consideration the judicial pronouncements in all fairness, the appeal should be remanded to the adjudicating authority - Accordingly, the appeal is remanded to the adjudicating authority who shall hear the case afresh after examining the ratio laid down in the above judgments, and pass appropriate order [Para 5]


Ericsson India Pvt Ltd Vs CCE (Dated: January 14, 2016) CX - Whether assessee is liable to CE duty on amount received, from buyers of electronic exchange, towards erection/ installation/commissioning charges - Assessee entered into contracts with BSNL for supply of digital exchange equipments - First of all it is an optional activity - Merely because said activity is being undertaken by supplier of goods does not mean that consideration for same has to be added in assessable value of goods - In any case, assessee has already discharged their ST liability in respect of said consideration, in which case same cannot be taxed to CE duty: CESTAT


Pam Pharmaceuticals & Allied Machinery Vs CCE (Dated: February 4, 2016) CX - CENVAT - Membership of business club like Entrepreneur Organisations is indirectly related to the promotion of business of the appellant - such expenses incurred are also forming part of the Assessable value - Once the cost incurred by the service has to be added to the cost, and is so assessed, it is a recognition by Revenue of the advertisement services having a connection with the manufacture of the final product as held by the Bombay High Court in the case of Coca Cola P. Ltd. - 2009-TIOL-449-HC-MUM-ST - Therefore, expenses incurred on the membership of the business club is an "Input Service" and appellant can legally take CENVAT credit of the expenses incurred on the membership of the club - Order set aside and appeal allowed with consequential relief: CESTAT [para 10]


Mungi Engineers Pvt Ltd Vs CCE (Dated: December 22, 2015) CX - Appellant sent material for job work - finished goods were returned by job worker and scrap was retained in the factory of job worker and later cleared on payment of duty - Duty on the said scrap was also allegedly paid by the appellant, therefore, they filed a refund claim for such duty paid erroneously but which was rejected by lo wer authorities - appeal to CESTAT. Held: On the one hand, the appellant stated that the scrap came back from job worker's premises and the enclosed invoices indicated that removal has taken place under assessees invoices - Commissioner (A) observed that the appellant had admitted to have indulged in fabrication of invoice by showing thereon imaginary road tempo no., imaginary quantity/assessable value/duty on scrap etc. - Order passed by Commissioner (A) rejecting the refund claim is legal and proper - Appeal dismissed: CESTAT [para 7, 8]


Sachins Impex Vs CCE (Dated: January 22, 2016) CX - CENVAT - Credit of Service Tax on account of Air Travel Agents service denied - appeal to CESTAT. Held: In the case of Semco Electrical P. Ltd. - 2010-TIOL-162-CESTAT -MUM it was held that air travel agents service used by appellant as conveyance are essential for the business purposes and these services are related to business only, hence Input services u/r 2(l) of CCR, 2004 - Following the same, Order set aside and appeal allowed with consequential relief: CESTAT [para 5]


CCE Vs Panam Engineers (Dated: February 5, 2016) CX - CENVAT - Supplies of excisable goods to SEZ developer, whether attracts provisions of rule 6(3)(b) of CCR, 2004 and whether the respondent is liable to pay 10% of the value of the goods so supplied. Held: Issue is no more res integra as the same has been settled in favour of assessee by various judgments viz. Fosroc Chemicals (India) Pvt. Ltd. - 2014-TIOL-1609-HC-KAR-CX - Even prior to the amendment by notification 50/2008-CE(NT) dated 31.12.2008, supplies made to SEZ is considered as export only and, therefore, the assessee is not required to pay any amount equal to 10% of value of the goods supplied to SEZ suppliers - Impugned order upheld & Revenue appeal dismissed: CESTAT [para 4, 5]


M/s Faithful Engineers Pvt Ltd Vs CCE (Dated: December 23, 2015) Central Excise - Default in payment of duty on consignment basis through PLA -Duty paid through Cenvat credit held not improper - Impugned order demanding payment of duty without utilization of Cenvat credit following several rulings held unsustainable and hence set aside.

Appellants have defaulted payment of central excise duty on consignment basis through P.L.A during the relevant period. The appellants were issued with show cause notices for contravention of Rule 8 (1), 8(3) and 8(3A) of Central Excise Rules, 2002 and Rule 3 (4) of CCR 2004 on the ground that appellants defaulted payment of duty on consignment basis through PLA and the duty paid through Cenvat credit should be treated as improper duty payment. The lower authorities confirmed the demand and also appropriated the amounts paid through P.L.A. The adjudicating authority also imposed penalty under Rule 25 and also ordered for interest.

On identical facts and circumstances, following the rulings of several High Courts, CESTAT allowed the appeal to hold that duty payment through utilization of Cenvat credit is not improper. Consequently, order demanding for payment of excise duty on consignment basis without utilization of Cenvat credit along with interest and penalty set aside. Appeal accordingly disposed of. (Para 4, 5)


CCE Vs GTC Industries Ltd (Dated: November 27, 2015)

CX - Valuation of captively consumed different types of printed packing materials of paper and paperboard - Revenue alleged undervaluation - adjudicating authority

confirming CE duty demand and imposing penalties and interest - Commissioner (A) setting aside order on limitation as well as on merits - Revenue in appeal before CESTAT. Held: For the period prior to the period in question, the respondent were directed to prepare the costing and assessable value of the product on the basis of the Assistant Director (Cost) recommendation dated 10/11/1993 which was done so by the respondent for the period prior to and also subsequently - it cannot, therefore, be said that the appellant had suppressed the entire material from the department - moreover, respondent had produced various documents before the lower appellate authority to justify their stand of correctness of valuation adopted - there is nothing on record to show that the said factual position is controverted by the Revenue - so also, the appellate authority had correctly come to the conclusion that there cannot be any suppression of facts for the simple reason that the final products manufactured by the respondent are cigarettes which during the period was under physical control of the departmental officer, posted at the factory - no reason for interfering with such a reasoned order passed by the Commissioner (A) - Revenue Appeal rejected: CESTAT [para 6.1, 6.2, 6.4, 7, 8]


Bharati Mulchand Chheda Vs CCE (Dated: March 10, 2016)

CX - Once the factum of death of the sole proprietor has come to the knowledge of the Commissioner, he should have dropped the proceedings rather than passing the impugned order confirming the duty demand, which is not sustainable in law - Appeal allowed: CESTAT [para 6, 7]



Panorama Industries Vs CCE (Dated: February 5, 2016) CX – Loss of goods cleared for export, lying at Central Warehousing Corporation - As per section 35B of CEA, 1944, first proviso, clause (a), Tribunal has no jurisdiction to hear the appeals as held by LB in case of Supercoats Industries - 2005-TIOL-332-CESTAT -MUM-LB - appeals dismissed as non-maintainable – appellants have liberty to file revision application before the Joint Secretary (RA) to the Govt. of India: CESTAT [para 2]


S M Enterprises Vs CCE (Dated: January 14, 2016) CX – Appeal filed before Commissioner (A) after 97 days from the date of receipt of order-in-original; appeal dismissed on ground of limitation – appellant before CESTAT contending that Commissioner (A) should have decided the matter on merits instead of dismissing on ground of limitation. Held: Supreme Court in the case of Singh Enterprises - 2007-TIOL-231-SC-CX has held that the proviso to sub-section (1) of section 35 makes the position clear that the appellate authority has no power to allow the appeal to be presented beyond the period of 30 days after the expiry of the 60 days which is the normal period of filing the appeal – Appeal dismissed: CESTAT [para 4, 5]


Indo Count Industries Ltd Vs CCE & ST (Dated: November 18, 2015)

CX - CENVAT credit of ST paid on outward transportation of goods for the period March 2008 to December 2009 - lower authorities denying credit - appeal to Tribunal. Held: As the sale concluded only after the delivery of the goods was made at the address of the buyer, credit of ST paid on outward transportation of goods is admissible even after 01.04.2008 - case squarely covered by the Karnataka High Court decision in Madras Cement Ltd. - 2015-TIOL-1682-HC-KAR-CX - reliance placed by AR on the Calcutta High Court decision in Vesuvious India Ltd. 2013-TIOL-1038-HC-KOL-ST may not be applicable as the facts of that case is different and the issue in that appeal was considering the definition of ‘input services' prior to amendment of rule 2(l) of CCR, 2004 w.e .f 01.04.2008 - order set aside and appeal allowed: CESTAT [para 6]


Arbes Tools Pvt Ltd Vs CCE (Dated: January 8, 2016) CX - Goods were intended to be transferred to their own unit but inadvertently instead of issuing a challan under rule 4(5)(a) of CCR they issued an invoice and wherein duty was charged but not deposited; also it is mentioned that no sales tax is charged as goods are being transferred to own unit - Appellant has paid duty along with interest on being pointed out by the Audit officer - later, SCN issued and penalty imposed u/s 11AC r/w rule 25 of CER - penalty upheld by Commissioner (A) so appeal before CESTAT. Held: For imposition of penalty u/s 11AC of CEA, 1944, duty must be determined by the excise officer after giving sufficient opportunity to appellant which has not been done in terms of s.11A(10) and as per s.11A(b) of CEA, 1944 - penalty cannot be imposed - appeal allowed: CESTAT [para 6]


Aarti Industries Ltd Vs CCE (Dated: January 18, 2016) CX - Aluminium coils, SS sheets, plates, channels, M S angles etc. used for making support of foundation structure of reactor and chimney - Credit availed on the ground that these items are capital goods but Revenue has denied the same - appeal to CESTAT. Held: Explanation 2 annexed with the definition of 'Input' u/r 2(k) of CCR indicates that it includes goods used in the manufacture of capital goods which are further used in the factory of the manufacturer - High Courts have categorically held that there is nothing on record to suggest that the amendment made in Explanation 2 was clarificatory in nature - Appellants are entitled to CENVAT credit on all the items - moreover, various benches of the Tribunal have held that when the same provision of law is subject to various interpretations by different benches, then in that situation, extended period of limitation should not be invoked since in that situation malafide cannot be attributed on the part of the appellant - entire demand except an amount of Rs.14,206/- is time barred - appeal allowed on merits as well as on limitation: CESTAT [para 8, 9, 10, 11]


Cipla Ltd Vs CCE (Dated: January 12, 2016)

CX - Valuation - s.4 of CEA, 1944 - After clearance of goods to depot, appellant selling the same to customers after offering quantity discount - refund claim filed on the ground that the AV should be the value arrived at after giving quantity discount and not the value at which the goods were cleared from factory to depot - claim rejected by lower authorities, therefore, appeal to Tribunal. Held: Transaction value defined u/s 4(3)(d) of CEA, 1944 is to be read at the time of delivery for clearance of the goods at the place of removal and time of removal has been described as the time of clearance of goods from appellant's factory or depot - For permitting the deduction of quantity

discount, what should be known and understood prior to sale is the quantity discount scheme or policy and not the exact quantum of quantity discount available to a buyer based on the discount scheme, which would be known only at the time of sale or at the end of the period specified in the discount scheme - Order set aside and appeal allowed with consequential relief subject to necessary safeguards: CESTAT [para 4, 5]


CCE Vs Kirloskar Brothers Ltd (Dated: November 30, 2015) CX - Whether the supply made to SEZ developer for their authorized office can be treated as export and secondly whether demand of 10% of the value of the goods in terms of rule 6(3)(i) of CCR, 2004 is correct and legal or otherwise? Held: Issue is settled by Karnataka High Court in the case of Fosroc Chemicals (India) Pvt. Ltd. - 2014-TIOL-1609-HC-KAR-CX that even prior to amendment notification 50/2008-CE(NT), dated 31.12.2008 supplies made to SEZ developer has been treated as export and a ccordingly, manufacturer/supplier need not to pay 10% in terms of rule 6(3)(i) of CCR, 2004 - since Revenue appeal in case of Siemens Ltd. is pending before the Bombay High Court and there is no stay in the matter, the submission of AR to keep the matter in abeyance cannot be accepted particularly when issue is already decided - Order of Commissioner (A) is upheld and Revenue appeal is dismissed: CESTAT [para 6]


Precision Metals Vs CCE (Dated: January 12, 2016) CX - CENVAT - Appellant paying Service Tax in terms of s.66A of the FA, 1994 r/w rule 2(1)(d)(iv) of the STR and availed credit - during audit, objection was raised that the assessee is not entitled to take credit - appellant reversing credit - SCN issued and demand confirmed along with interest and penalty - Commissioner (A) setting aside interest but confirmed equal penalty - appeal to CESTAT only against penalty. Held: There is no allegation regarding fraud, willful misstatement, suppression of facts which are required as per rule 15(2) r/w s.11AC of CEA, 1944 for imposition of equal penalty - Once the Commissioner (A) has dropped the interest on the ground that the CENVAT credit was availed but not utilized and by relying upon the judgment in the case of Ind-Swift Laboratories - 2009-TIOL-440-HC-P&H-CX and there are no allegations of suppression and no categorical finding on the ingredients of s.11AC, then imposition of penalty is wrong and illegal - order set aside and appeal allowed: CESTAT [para 6]


M/s Novateur Electrical And Digital Systems Pvt Ltd Vs CCE (Dated: January 06, 2016) CX - Adjustment of rebate - No demand under Rule 8 (3A) of CER, 2002 can be raised without service of valid SCN, giving an opportunity of hearing for adjudication, provisio n being penal in nature - Under circumstances in case being short payment of duty, provisions of Rule 8(3A) are not attracted and Commissioner (Appeals) has erred in upholding appropriation of purported demand under Rule 8 (3A) - No appropriation under Section 11 of Act, can be done without giving an opportunity of hearing to assessee - Appropriation is bad on this score also - Assessee will be entitled to refund of rebate with interest starting from three months from date of sanction till date of disbursement: CESTAT


Akasha Syncotex Ltd Vs CCE (Dated: February 17, 2016) CX – It is a national loss to stop production in any fa ctory premises - law cannot be such by which production in this country can be suspended for any reason – merely because there is a demand notice pending, de-registration cannot be denied – Appeal allowed: CESTAT [para 6]



Sujata Chemicals Ltd Vs CCE & ST (Dated: January 08, 2016) CX - Assessee had taken ground in their appeal that demand of duty is barred by limitation - They had also stated in instant application before Bench that this issue was escaped notice of Bench, while passing Final Order - Period of dispute is 2007-08 to 2009-10 and SCN was issued on 22.12.2010 - Revenue has not disputed findings of Tribunal while setting aside penalty under Section 11AC of Act - In Final Order dt.10.06.2015, it is observed by Tribunal that there was no suppression of facts with intent to evade payment of duty - So, demand of duty for extended period of limitation as per Proviso to Section 11A of CEA, 1944 cannot be sustained - Hence, it would be read in Final Order dt.10.06.2015 that "the demand of duty alongwith interest for the extended period of limitation cannot be sustained": CESTAT


Pyrotech Workspace Solutions Pvt Ltd Vs CCE (Dated: January 20, 2016)

CX - Assessee is both a manufacturer and a service provider - They manufactured dutiable industrial furniture and also render taxable output services like GTA, maintenance and repair service, commissioning and installation service and BAS - Credit on commercial construction service is not sought to be denied on ground that such credit is not available in terms of CCR, 2004 - Said input service is used for providing output services - Once the credit is availed, use of such credit is governed by Rule 3 of CCR, 2004 - There is no one to one co -relation or condition that credit on input services can be utilized only for discharging tax on output services or Excise Duty on final products cannot be paid using Cenvat credit availed on input services - Impugned order has not examined whether input service is eligible for credit as it has got nexus with taxable output service provided by manufacturer - Thus, discussion and findings were mis-directed resulting in unsustainable conclusion: CESTAT


Pawan Alloys And Casting Pvt Ltd Vs CCE (Dated: November 17, 2015) CX - Redetermination of annual capacity of production under compounded Levy scheme - Assessee submits that furnace of capacity 3.0 MT was lying sealed w.e.f. 19/9/97, vide punchnama were drawn and duly signed by Officers of Revenue as well as Director of assessee, in presence of witnesses - According to rules only furnace which is installed and put to use is required to be considered for determining annual capacity - Thus, impugned order set aside to extent annual capacity of production is determined at 6.4 MT and Tribunal re -determine the same at 3.4 MT for period 1998-99: CESTAT


Dalmia Cement (Bharat) Limited Vs CCE (Dated: December 28, 2015) Central Excise - Cenvat credit on maintenance of green belt to reduce pollution by Cement factory in compliance with the directions of Pollution Control Board - Admissible as input service - Impugned order denying Cenvat credit availed thus set aside - Assessee appeal allowed. (Para 2)

Central Excise - Cenvat credit on outdoor catering service to workers/employees of factory in compliance with the provisions of Factory Act - Admissible - Disallowance order unsustainable hence set aside - Assessee appeal allowed. (Para 4)

Central Excise - Cenvat Credit claim based on Xerox copies - Proof of identification and necessary details directed to be placed before adjudicating authority - Appeal thus remitted to the adjudicating authority to examine the eligibility of the CENVAT credit to the satisfaction of the law. (Para 6, )


M/s Kusum Foundry And Metal Works Pvt Ltd Vs CCE (Dated: February 01, 2016) CX - Whether assessee manufactured and cleared dutiable goods with brand name or trade name of another person - Managing Director of assessee company had confirmed that they have been clearing hubs and drums which is further confirmed from balance sheet for relevant period - Affidavits of retraction filed after almost 1 1/2 years are clearly an afterthought - Commissioner examined all evidences and concluded that assessee have cleared during impugned period goods with brand name which was not owned by them and as such are liable to duty as SSI exemption will not be available to them - No merit in appeal, hence, dismissed: CESTAT


M/s Shri Khatu Shyam Industries Vs CCE, C & ST (Dated: December 4, 2015) CX - Clandestine removal - Demand of duty confirmed on basis of private records of M/s Vishnu Steel (buyer), where name of other manufactures including assessee were mentioned - Private records of buyer were seized - No visit was effected to assessee's factory and no enquiry was conducted in respect of clandestine removal of goods - Assessee requested for cross examination of buyer and broker, which were refused on ground that partner of assessee had accepted statement of buyer - Tribunal on same investigation have taken view that allegation of clandestine removal cannot be established merely on basis of statement of buyers and brokers and documents recovered from buyer without any enquiry of assessee - Statement of partner of assessee is un-corroborative in nature - Impugned order cannot be sustained, so, penalty imposed on partner of the assessee is unwarranted: CESTAT


M/s Chamunda Engineering Works Vs CCE & ST (Dated: January 11, 2016) CX - Assessee and M/s Hitech were registered with CE Department in 1994 - Subsequently, assessee was availing benefit under SSI exemption and therefore, they

surrendered their registration - It is found that there was no plant and machinery installed in premises of M/s BEW and M/s CEPL and there was no record showing any payment towards use of machinery and electricity supplied to Hitech and assessee to other units - On perusal of list of machineries, it is found that these machineries were purchased during period 1990 to 2001 - Assessee has not given any reasons as to why they have failed to disclose these evidences before lower authorities and therefore, such evidence cannot be accepted before Tribunal, at a belated stage - There was no manufacturing activity in other units - Hence, Adjudicating authority rightly clubbed clearance value of other units with M/s BEW - Impugned order modified to extent that demand of duty alongwith interest and penalty imposed on assessee is upheld - Penalties imposed on Shri Babubhai Mistry and Smt. Jasuben Mistry are reduced to Rs.1 lakh and Rs.50,000.00 respectively - Penalty imposed on M/s CEPL and M/s Hitech, M/s BEW are set aside: CESTAT


M/s Classic Polytubes Pvt Ltd Vs CCE (Dated: January 13, 2016) CX - Valuation - Issues involved is inclusion of inspection charges at instance of buyer and freight/insurance charges from place of removal, in assessable value under section 4 of CEA, 1944 - Sale is effected at factory gate which is place of removal and transportation cost is separately indicated in invoices - Place of removal was only extended to either factory or a warehouse/premises from where duty was paid - Under no circumstances can buyer's premises, therefore, be place of removal for purpose of Section 4 - Appeal of assessee on this account is thus required to be allowed - As regards to issue of inclusion of inspection charges in assessable value, same are not mandatory inspections during manufacture of goods - Pre -delivery inspection charges cannot be included in assessable value - Optional inspection charges at instance of buyer cannot be included in assessable value under Section 4 of Act, 1944: CESTAT


CCE Vs Garware Wall Ropes Ltd (Dated: March 2, 2016) CX - As respondents are procuring their primary raw materials viz. tapes, without payment of duty, they are not entitled to the benefit of Notfn. 6/2002-CE as they would not have fulfilled the condition 34 specified in the said notification - consequently, they are not eligible for exemption under Notfn. 13/98-CE - Revenue appeal allowed: CESTAT [para 5, 6, 8]



Essar Oil Ltd Vs CCE, C & ST (Dated: January 15, 2016) CX - Chartered Accountant Service - Assessees engaged in manufacture of various excisable goods - CA Service is specifically covered under scope of input service - CA Service related to day-to-day service cannot be reason for denial of CENVAT credit - So, assessee is eligible to avail CENVAT credit of CA Service.

Security Service - Act of providing residential quarters by manufacturer, voluntary in nature and has no connection between such service as having direct or indirect relation to manufacture and CENVAT credit would not be available - So, assessee is not eligible input service credit on security service rendered at Guest House and

Hostels of assessee.

Outdoor Catering Service - Said service has been utilised for catering services for company Guest House at Refinery which is within manufacturing premises and therefore, assessee is eligible to availed credit.

Impugned order is modified to extent that denial of CENVAT credit on CA Service and Outdoor Catering Service and Advertisement Service is set-aside - Denial of CENVAT credit on other input services are upheld - Penalties are set-aside: CESTAT


Maxmech Equipment Vs CCE & ST (Dated: December 8, 2015) Central Excise - Cum duty benefit - Denial of SSI exemption benefit under Notification No. 8/2002-CE dated 01.3.2002 - Sustainability - Appellant charged invoice value to the customers including the duty and other taxes - Computing clearance value ought to be determined after extending cum-duty benefit for the purpose of exemption benefit as value charged is inclusive of excise duty - On facts held that subject to the value of clearances for the purpose of determining exemption benefit, the cum-duty benefit would be extended. (Para 5)

Central Excise - Duplication of demand - Sustainability - Invoices mentioned in the Annexure 'C' to the show cause notice have already been included in Annexure 'A' to the show cause notice while computing the value of clearances - Demand of duty as shown in Annexure 'C', as included in Annexure 'A', hence cannot be sustained - adjudicating authority is directed to re -determine and re-quantify the demand of duty, interest and penalty as per above directions (Para 5, 7)

Central Excise - Penalty on Firm as well as partner simultaneously - Firm has already paid the duty along with interest and penalty to the extent of 25% of the duty as per Section 11AC of the Act - In the circumstances, imposition of separate penalty on the Partner of the firm is not justified - Penalty set aside. (Para 7)


CCE Vs M/s Chakra Rolling Mills Pvt Ltd (Dated: January 22, 2016) CX - Clandestine removal - Assessee being engaged in manufacture of Rolled Iron and Steel products, were suspected to have indulged in issuing only invoices without actual sale and movement of finished goods - Original allegation and present appeal which was based on such allegation present propositions which are peculiar and contradictory - It was further alleged that equivalent quantity of goods have been clandestinely manufactured and cleared - Duty which is sought to be demanded and confirmed by Original Authority has already been remitted by main assessee - Now, again such demand was justified on ground that equivalent amount of impugned goods were manufactured and cleared clandestinely - For this, no attempt even has been made to adduce evidence - It is found that there is no basis to interfere with findings in impugned order: CESTAT


M/s Apollo Pipes Ltd Vs CCE & ST (Dated: October 20, 2015) CX - Assessee is a manufacture of PVC pipes of various grades and sizes and fittings thereof - They are also availing facility of Cenvat credit on inputs and capital goods -

They maintained stock records on basis of actual weight, whereas as at time of inspection, average weight of 10 pipes was taken and same was applied to approximate number of pipes of finished goods available - No instance of any clandestine removal and nor there is found existence of fudging of records - Discrepancy or variation in physical stock found, is a normal variation and does not call for any adverse inference - Assessee also have not made any attempt to explain variation found at time of inspection, except alleging that there is discrepancy in manner of stock taking - Duty reduced by 50% and waiver of penalty is upheld: CESTAT


Petals Engineers Pvt Ltd Vs CC & CE (Dated: February 15, 2016) CX - Transaction/Assessable value - Section 4 of the CEA, 1944 - Appellant have raised two invoices, one is towards sale of the machines and second for integration and commissioning of the machines supplied to the customers - Integration and commissioning is an independent activity which can be performed either by the appellant or any outside agency - charges recovered towards integration and commissioning charges is not rela ted to the sale of the goods but it is for independent and distinct identified activity - Once the goods are fully manufactured and cleared from the factory, activity of erection/installation carried out subsequently & the charges therefor cannot be included in the assessable value - It is not the case of the Revenue that in the light of integration and commissioning charges appellant have suppressed the sale value of the machines, but it is also not the case that value charged for the integration and commissioning is overvalued, therefore, the amount charged for integration and commissioning has to be accepted - integration and commissioning charges of the machines cannot be included in the transaction/assessable value of the machines - Appeal allowed: CEST AT [para 6]



J K Paper Ltd Vs CCE, C & ST (Dated: December 4, 2015) Central Excise - Removal of Cenvat credit availed capital goods as waste and scrap - Whether appellant is required to reverse Cenvat credit on such removal - CENVAT Credit Rules, 2004, Rule 3 (5) - Appellant neither disclosed clearance of removal of scrap to the department nor was able to demonstrate that they have not availed Cenvat credit - In the circumstances, demand of duty along with interest upheld - Appellant also directed to pay 25% of duty as penalty - Revenue held entitled to invoke extended limitation period - Appeal of the appellant accordingly disposed of. (Para 4, 5)


Techfab India Industries Ltd Vs CCE (Dated: September 22, 2015) Central Excise – Procurement of intermediate goods without payment of duty under Notification No No. 44/2001-CE (NT) dated 26.06.2001 for supply of finished goods under Notification No. 108/1995-CE dated 28.08.1995 – Exemption denied on the ground that the appellant had not exported the resultant products, out of India.

Held: By amendment of Notification No. No. 44/2001-CE (NT), vide notification 23/2009 -CE (NT) the scope of the notification has been enlarged by a proviso. The effect is that the procedure as laid down in the said notification shall also be available to a manufacture of Advance Authorization holder supplies the goods to another

Advance Licence Holder, who in turn, supplies resultant products to an ultimate export in terms of Para 8.3 (c) of policy (para 8)

It is well settled that proviso would be construed harmoniously with the opening paragraph of the notification, to which it stands. A proviso in the statute must be considered with relation to the main matter to which it stands as a proviso. The manufacturer of Advance Licence holder supplies the material to another manufacturer, who in turn supplied the resultant products to the ICB would be covered within scope of the notification. It is not justified to ignore the plain meaning of the proviso and interpret in such a manner, as it would render inconsistency with and meaningless of the notification. (para 10)

The demand of duty alongwith interest and penalty cannot be sustained. The impugned order is set-aside. The appeal filed by the appellant is allowed. (para 15)


Dhar Cement Ltd Vs CCE (Dated: February 23, 2016)

CX - Assessee engaged in manufacture of cement and claimed benefit of notfns 24/91 and 5/93-CE - Concession of Notfn is available when installed capacity is not exceeding 1,98,000 T.P.A. - Director of Industries, Madhya Pradesh, who is designated as a competent authority in Notfn itself has more than once certified installed capacity of assessee to be 1,98,000/-T.P.A - He also observed that with reference to various evidences submitted by Revenue his office is in agreement with clarifica tion given by assessee that their annual installed capacity was 1,98,000 M.T. and they were capable to produce 25% extra, for which there was no restriction from Government end - In-spite of such confirmation by Commissioner of Industries Madhya Pradesh, original authority examined issue of assessees' eligibility and held that they have deliberately mis -declared installed capacity to Central Excise Department to avail concessional rate of duty under Notfn 24/91 - When competent authority reiterated the certificate after examining contrary evidence produced by Revenue it is not open to Commissioner to sit on judgment on such certificate - Department cannot deny concession claimed based on such certificate: CESTAT


Allied Electricals Vs CCE (Dated: January 28, 2016) CX - It is alleged that assessee was clearing goods without payment of duty and without accounting in statutory records - Partners of assessee had categorically admitted impugned evasion of duty in their voluntary statements recorded on various dates - Statements of partners categorically and fully establish evasion of duty - There is no allegation that statements are not voluntary and they had never been retracted - Goods were cleared without issuing proper invoices and therefore it cannot be said that price charged included central excise duty - In their statements, partners of firm also did not claim that price charged was inclusive of duty - No infirmity in impugned order: CESTAT


Daechang India Seat Company Vs CCE (Dated: February 22, 2016)

Central Excise – Demand on account of difference between stock figures appearing Balance Sheet and the ER 1 returns – Demand dropped by the original authority,

reversed by the Appellate authority.

Held: ER-1 returns disclosed the stock position. But that was reconcilable with the reason of difference in respect of the figure appeared in Balance Sheet. That was not examined by appellate authority. The case was booked against the appellant on the basis of audit finding. They neither found any discrepancy in the clearance of goods nor in the accounts of the appellant, as well as stock - Order passed by Commissioner (Appeals) is set aside and appeal allowed. (para 4)


CC Vs Avaya Global Connect Ltd (Dated: November 6, 2015) Cus - Valuation - Rule 9(1)(c) of the Customs Valuation (Determination of Price of Imported Goods) Rules, 2008 -Adjudicating authority held that the royalty paid in terms of the technology transfer Agreement was a condition of sale of the goods by Lucent Technologies Inc. to the appellant and, therefore, it was includible in the assessable value, while the Commissioner (Appeals) held that it was not a condition of sale - Revenue in appeal before CESTAT. Held: Initially, the appellant was importing components to manufacture cards but subsequently the appellant started importing cards themselves - Royalty in both the circumstances remained the same and continued to be based upon the number of ports activated - Once it is held that royalty payment is a condition of sale, it is immaterial how the royalty payable is computed - In the present case, royalty payment was arrived at on the basis of number of ports activated by the card, therefore, the royalty paid by the appellant is includible in the assessable value - Revenue appeal allowed: CESTAT [para 5, 6]


Uniworth Textiles Ltd Vs CCE (Dated: February 4, 2016) CX - Appellant, an EOU, cleared fabrics in the year 2003 for purpose of export but which got damaged due to rain and had to be brought back to the factory - goods were examined by Insurance Surveyor who reported that 11786.30 mtrs of fabrics was damaged and balance was in good condition - later, in year 2006, appellant claim to have discovered certain chemical which could be used to make the damaged fabric fit again - accordingly, they recovered part of fabric which was exported and balance they cleared on payment of duty to DTA - Demand was issued alleging that the claim of recovery of fabric was wrong - as duty demand was confirmed by lower authorities, appellant is before CESTAT. Held: Revenue has not challenged fact of clearance of reprocessed materials for export/DTA but only suspects that the claim is not valid - assertion of appellant cannot be set aside merely on suspicion - there is no reason to deny benefit to appellants who were able to reprocess the damaged goods - Order set aside and appeal allowed: CESTAT [para 4, 5]


Tata Toyo Radiators Ltd Vs CCE (Dated: February 15, 2016) CX - CENVAT - Appellant availing credit twice on the same set of documents in September 2008 - after reconciliation when the above was detected the appellant reversed the same in March 2009 and informed R/S - SCN was issued demanding recovery of the credit availed of Rs.1,46,72,686/-; appropriation of the same and recovery of interest of Rs.9,51,112/- - demand confirmed - appellant in appeal submitting that it was an inadvertent act and that they had sufficient credit balance in their account and since the wrongly availed credit was never utilized, they are not

liable to pay a ny interest.

Held: In view of the Supreme Court decision in Ind-Swift Laboratories Ltd. 2011-TIOL-21-SC-CX , even if the credit is availed wrongly, the liability to pay interest would accrue - Bombay High Court has in GL & V India Pvt. Ltd. 2015-TIOL-1210-HC-MUM-CX also held the same - Appellant is, therefore, liable to discharge interest liability amounting to Rs.9,51,112/- paid subsequently and is not entitled to any refund of the same - Appeal dismissed: CESTAT [para 6, 7]


Sigma Electric Manufacturing Corporation Pvt Ltd Vs CCE (Dated: February 11, 2016) CX - Appellant is a 100% EOU and entire production of electrical wires, accessories of aluminium, zinc and copper alloys is exported out of India except for waste and scrap arising during the process of manufacture which is cleared in DTA on payment of Central Excise duty - as credit of service tax on input services remains unutilized, appellant filed refund claim u/r 5 of CCR, 2004 and part of the same was rejected on the ground that some services on which credit was taken do not qualify as “Input service” u/r 2(l) of CCR, 2004 - Commissioner (A) holding that rule 2(l) is beyond the scope and power provided to the Central government to frame rules u/s 37 of CEA, 1944 on the ground that it does not have power to include activities relating to business within the scope of definition of ‘Input services' - appeal to CESTAT.

Held: From the definition of Input service, it is very much clear that all the services on which credit is claimed namely Catering, CHA, CA, Insurance Premium etc. are directly or indirectly rela ted to business of manufacture of goods and export of the same - it is policy of the government since inception that export should be tax free i.e objective of the government is to export the goods and services and not taxes - if refund is not allowed of ST paid on input services, then the said taxes will be built in the cost of final products and would lead to export of taxes which are against the policy of government - impugned order is wrong and, therefore, same is set aside - Order no. A/745-752/2009 dated 17.12.2009 [2010-TIOL-162-CESTAT -MUM] in appellant's own case relied upon - appeal allowed with consequential relief: CESTAT [para 13, 14]


Nazareth Metals Vs CCE (Dated: February 05, 2016) CX - Miscellaneous application filed for implementation of Tribunal order and a direction by Tribunal to Asstt. Commissioner to sanction the refund claim.

Held: Order has been passed by Tribunal disposing of two appeals as stated by applicant and, therefore, there is no ambiguity in the Tribunal order - further, order by Asstt. Commissioner is an appealable order and appeal against the same lies before Commissioner (A) - It is not appropriate and legal for Tribunal to direct Asstt. Commissioner to sanction the refund along with interest because it is for the adjudicating authority to decide the same in the light of the Tribunal order - Application is disposed of accordingly: CESTAT [para 7]


CCE & C Vs Fine Packaging Pvt Ltd (Dated: January 19, 2016)

CX - Respondent have availed CENVAT credit on inputs which were used in the process of printing and lamination processes of the Polyester/BOPP Film and this

activity was held to be non-manufacture by Supreme Court in the case of Metlex (I) Pvt. Ltd. - Commissioner (A) allowed credit on ground that appellant had utilized credit of Rs.28.38 lakhs for payment of duty of Rs.36.36 lakhs which was not required to be paid and thus had effectively reversed credit - Revenue in appeal.

Held: Even if it is accepted that the activity of the respondent does not amount to manufacture, credit cannot be denied on inputs as per provisions of rule 16 of CER, 2002 - impugned order is upheld and Revenue appeal is dismissed: CESTAT [para 4]


Seto Teknolog Pvt Ltd Vs CCE (Dated: February 05, 2016)

CX - CENVAT credit on Courier Bill of Entry - as per the Bill of Entry Regulation, 1976, courier bill of entry is a valid document for clearance of any imported goods and this is so provided as per Regulation 5(3) proviso of Courier Imports and Exports Clearance Regulation 1988 - appellants have actually received the imported inputs and utilized the same in the manufacture of final product which is cleared on payment of duty - credit admissible as the same is to be construed to be a proper document u/r 9(1) of CCR, 2004 since courier bill of entry is also a bill of entry as there is no mention that it is not a proper document - Appeal allowed with consequential relief: CESTAT [para 6, 8]

CENVAT - Limitation - appellants have been disclosing in their regular returns about the credit availed on the basis of courier bill of entry - Audits were also conducted from time to time but objection was never raised - department has not been able to bring on record any material which shows willful misstatement or suppression of facts of contravention of any rules with intent to evade duty - Larger period not invokable: CESTAT [para 7, 8]


Ultra Tech Cement Ltd Vs CCE (Dated: February 16, 2016)

CX - Rule 57S of CER, 1944 - MODVATTED capital goods removed from the factory without installation and without putting to use by treating as waste and scrap - Paying CE duty on Transaction Value will not suffice & Credit reversal is warranted - Appeal dismissed: CESTAT [para 5]



Sahyadri Starch & Industrial Pvt Ltd Vs CCE (Dated: February 4, 2016)

CX - CENVAT - Appellant availing CENVAT credit on input services which were used for both dutiable excisable goods and exempted goods - a total credit of Rs.54,01,113/- was availed during the period July 2008 to June 2009 - as no separate records were maintained, Revenue demanding an amount of Rs.2,32,23,720/- in terms of rule 6(3)(i) being the 10% amount of the value of exempted goods - equivalent penalty also imposed, hence assessee in appeal. Held: It is not disputed that some of the services used fall under rule 6(5) of CCR and in respect of these, credit has to be allowed in its entirety irrespective of facts that they are used in production of exempted goods - in the case of Mercedes Benz Ltd. - 2015-TIOL-1550-CESTAT-Mum , Tribunal has held that Rule 6 is not designed to collect revenue from appellants but to undo the effect of the input credit taken in respect of exempted goods - Even if the

appellant has failed to exercise the option and follow procedure mandated under rule 6(3), such failure does not take away their substantial right - therefore, the offer of the appellant to reverse proportionate ineligible credit has merit - as appellant has already reversed ce rtain amounts but not paid interest thereon, they are required to do so after ascertaining the correct proportionate ineligible credit - matter remanded to Commissioner: CESTAT [para 5, 5.1, 5.2, 6]


CCE Vs Pfizer Ltd (Dated: February 4, 2016) CX - Classification - Whether the products manufactured by the respondent namely, Oxy-Tetracycline Hydrochloride Skin Ointment 50/15G, Oxy-Tetracycline Hydrochloride AF Tabs and Oxy-Tetracycline 500 mg Capsule are classifiable under 3003.20 as medicaments other than Patent or Proprietary medicaments or under 3003.10 as Patent or Proprietary medicaments - Allegation of Revenue is that since the above names are not appearing in the Pharmacopoeia, therefore, the same is Patent or Proprietary medicaments and correctly classifiable under SH 3003.10 - CCE dropping the proceedings, therefore, Revenue in appeal. Held: In the present case, Oxy tetracycline IP and oxy tetracycline Hydrochloride IP is admittedly appearing in the Indian pharmacopoeia - further, Oxytetracycline capsule is specifically appearing in the India pharmacopoeia - product Oxytetracycline Hydrochloride skin ointment and Oxytetracycline Hydrochloride (AF) tablet though not verbatim appearing in the pharmacopoeia, medicament is appearing in the Indian Pharmacopoeia, therefore, the medicaments produced by the respondent have names appearing in the 'Indian pharmacopoeia' and, therefore, the same are not 'Patent or Proprietary medicaments' - Commissioner has rightly classified the products in question under CH 3003.20 - no infirmity in the order, hence upheld - Revenue appeal dismissed: CESTAT [para 6]


Maharashtra Power Transmission Structures Pvt Ltd Vs CCE (Dated: February 4, 2016) CX - Credit availed on Wires & Cables & refractory denied on the ground that these are not Capital goods in terms of definition of 'capital goods' - Commissioner (A) rejected appeal on the above ground as well as on the ground that invoices indicate the address of the appellant as well as site and, therefore, the goods were not received in the factory - appeal to CESTAT. Held: Wires and Cables being covered under Ch. 85 is specified under sub-clause (A)(i) of Clause (a) of Rule 2 of CCR, 2004 and refractory and refractory material is covered under sub-clause (v) - appellant's goods are undoubtedly falling under the definition of Capital goods, hence the credit cannot be denied - as regards the second ground of denial of credit, it is a matter of fact and it is necessary on the part of the Revenue to investigate and which was not done; also issue not raised in SCN and even adjudicating authority has not given any finding on this issue - it is a settled law that new case cannot be made out after issuance of SCN and after passing of adjudication order - order set aside and appeal allowed: CESTAT [para 6]


Kam Garments Pvt Ltd Vs CCE (Dated: February 17, 2016) CX - During audit it was detected that the appellant had cleared goods containing brand name of others and the value of the same was not included in the first clearance upto an aggregate value not exceeding Rs.100 lakhs - SCN issued and demand confirmed by lower authorities - appeal to CESTAT. Held: Provision of the notification is very clear - It clearly provides that the value of clearance for home consumption of goods whether on payment of duty or otherwise falling under Chapter

62 between 01/04/2001 and 30/04/2001 shall be taken into account while computing the aggregate value of clearances at Nil rate of duty under Sl. No. 1 of the said table for the FY 2001-2002 - notification cannot be more clear than this - there is no doubt as to how the first clearances are to be calculated - appellant took registration on 29/05/2001 and, therefore, it was not possible for revenue to know what was their clearance during the month of April 2001 - notification as amended is very clear an unambiguous - in this era of self assessment, it is the responsibility of the assessee to correctly determine the duty as per law - appellant has failed to do so, extended period is rightly invoked - Appeal dismissed: CESTAT [para 7, 8, 9]


CCE Vs Hindustan Composites Ltd (Dated: February 8, 2016) CX - CENVAT - appellant had cleared excisable goods to Government departments without payment of duty by claiming exemption under notification 10/97-CE & 6/2002-CE - allegation is that they had availed credit on common inputs but not maintained separate records of the same when used for dutiable and exempted goods - demand of Rs.7,88,366/- raised and confirmed under rule 6 of CCR, 2004 - Commissioner (A) setting aside demand and, therefore, Revenue in appeal. Held: Commissioner (A) was fully convinced with the submission of the appellant with regard to maintaining separate accounts - adjudicating authority has also observed that the respondent had maintained separate accounts but not as per the requirement of law - it is also observed that there is no specific form prescribed and records maintained by assessee are sufficient - demand also issued in July 2008 for the period covering May 2004 to September 2005 and there are many letters exchanged by the assessee and department in this regard, so demand is hit by limitation - as no suppression is alleged, there is no justification for invoking extended period - Revenue appeal is dismissed: CESTAT [para 6, 6.2, 6.3, 7]


Monarch Catalyst Pvt Ltd Vs CCE (Dated: January 05, 2016) CX - Rule 2(l) of CCR, 2004 - Whether the appellant is entitled to CENVAT credit in respect of service tax paid to the commission agents based abroad?

Held: in view of Tribunal decision in Ambika Overseas 2010-TIOL-1113-CESTAT -DEL as affirmed by High Court 2011-TIOL-951-HC-P&H-ST , CENVAT credit is admissible in respect of commission paid to commission agents based abroad - Moreover, Commissioner (A) has not given any reasons for reversing the findings of the adjudicating authority allowing credit - as per notification 41/2007-ST as superseded by notfn. 18/2009-ST, appellant has an option to either avail CENVAT credit or to claim refund and appellant has chosen to claim credit - even though audit was conducted on two earlier occasions, department never raised the issue of inadmissibility of credit, hence demand is time barred - order set aside and appeal allowed with consequential relief: CESTAT [para 7 to 10]


Gujarat State Fertilizers And Chemicals Ltd Vs CCE, C & ST (Dated: December 30, 2015) CX - Assessee had given an undertaking before Tribunal that they will produce certificate from Govt. - There is no material available on record that they have produced CA's certificate before Adjudicating authority in denovo proceeding -

Assessee had not given any explanation as to why they have not produced certificate before Tribunal in earlier occasion and even before lower authorities - Order of Tribunal not challenged by assessee before higher appellate authority - Both authorities had examined matter as per directions of order of Tribunal, so, there is no error in order passed by lower authorities: CESTAT


CCE Vs Blue Star Ltd (Dated: February 26, 2016) CX - Condensing units, chillers, Walk in cold rooms supplied to Research institution are entitled for exemption in terms of notification 10/97-CE as the assessee has produced the required certificate from an officer, not below the rank of Dy. Secretary to the Govt. of India that the institution is not engaged in commercial activity and the goods a re required for research purposes - Revenue appeal dismissed: CESTAT [para 7]



Bajaj Auto Ltd Vs CCE (Dated: February 09, 2016)

CE - CENVAT - Appellant had during the period 2002 - 2003 written off certain inputs in their balance sheet as the same were non-moving and obsolete - Revenue sought to recover the credit involved in these inputs by relying on Board Circular 645/36/2002-CX - appeal to CESTAT. Held: Inputs removed from the financial accounts continued to remain in stores accounts awaiting its removal as well as for reversal of credit - appellants are not required to reverse credit as alleged - appeal allowed: CESTAT [para 5]


Manohar Brothers Capacitors Pvt Ltd Vs CCE (Dated: December 3, 2015) CX - SSI Exemption - Notfn. 175/86-CE - Department alleging that the assessee had crossed the clearance value of Rs.2 crores during the previous financial year 1989-90 and hence were not entitled to SSI exemption for FY 1990-1991 - duty demand confirmed and penalty imposed of Rs.5 lakhs in remand proceedings - Appellant submitting that the amount of penalty which has been paid by the appellant to the contractees should be deducted from the value of clearances as these are not in respect of sale of the goods and are in terms of the penal consequences in delayed execution of the contracts & also the insurance and the freight expenses were not correctly taken by lower authorities - inasmuch as if the above components are removed from the clearance value, the same falls below 2 crores and they are entitled for SSI exemption.


Tube Products Of India Vs CCE (Dated: November 26, 2015) Central Excise - Returned Goods - Valuation - CENVAT Credit - Demand - Assessee's

appeal is against demand of equal amount of credit availed on the duty paid goods returned under Rule 16(2) for the period 1.7.2001 to 30.6.2005 - No dispute on the facts that certain quantities of finished goods were returned by customers for va rious reasons and Cenvat credit of duty paid was taken by assessees under Rule 16(1) and subsequently they were sold in auction 'as such' and cleared on payment of duty on transaction value in terms of second leg of sub-rule (2) of Rule 16 - Revenue contends that assessee should have reversed the amount equal to Cenvat credit taken at the time of receipt of rejected goods in terms of first leg of sub-rule (2) of Rule 16 - Rule 16, Sub-rule (1) stipulates circumstances under which duty paid goods can be returned to factory and assessee is entitled to take credit of duty paid on them; Sub-rule (2) contemplates two situations (i) if the process undertaken by assessee does not amount to manufacture, then they shall pay the amount equal to Cenvat credit taken and (ii) 'in any other case', assessee shall pay duty on goods returned under Sub rule (1) as per transaction value - In the case, it is established beyond doubt that no process has been carried out on the returned goods - Hence, on the question whether first part or second part of sub-rule (2) of Rule 16 is applicable, it is clear that appellant is covered by Second part of the Sub rule, i.e., 'in any other case' as there is no process carried at all on the goods returned which are cleared 'as such' - In view of the precedents, which held in favour of assessee, when returned goods are cleared as such without any process, appellant has correctly discharged excise duty under second part of Rule16(2) on the returned goods cleared as such and are not liable to pay the amount equal to Cenvat credit availed on them- Revenue's appeals are on the identical issue but relates to refunds since refunds rejected by adjudicating authority were allowed by Commissioner (A) for the subsequent period - Since the main issue is decided on merits and the demand is set aside in the main appeal, no infirmity in the order of Commissioner (A) which allowed refunds to assessees by relying on the precedents - Impugned orders allowing refunds are upheld while demand against assessees is set aside - Assessee's appeal allowed while Revenue's appeals are rejected. (paras 4, 8, 9, 11, 12, 13)



Amba Steels Vs CCE (Dated: January 6, 2016) CX - Shortage of goods - Clandestine removal - Panchanama is silent as to manner of stock taking - It is a matter of eye estimation made by inspection team - No material or evidence of any kind to support findings that assessee had clandestinely removed goods which did not tally with physical stock - Shortage of finished goods, by itself would not unless it is related to clandestine removal of finished goods, for which there was no material evidence, infer evasion of Excise duty and that no penalty can be imposed - Impugned order set aside: CESTAT


Bharat Sanchar Nigam Ltd Vs CCE & ST (Dated: January 19, 2016) CX - Limitation - Assessee engaged in business of providing telecom services - No categorical evidence for due service of notice issued on 6.12.2010 - Issue involved is eligibility of various tower components, which were classifiable under Chapter 72/73 of Central Excise Tariff Schedule, which has been a matter of dispute before various judicial forums - Neither original order nor impugned order specifically elaborates grounds on which element of suppression, fraud, collusion or willfully mis-statement can be alleged and sustained against assessee - Only ground mentioned is that under Self-assessment Scheme, assessee should have been taken credit only on eligible items, said reasoning is not sustainable either in law or on fact - Impugned order set aside: CESTAT


M/s Sai Wardha Power Ltd Vs CCE (Dated: January 25, 2016) CX - s.35B(1) of CEA, 1944 - Rebate claims - Maintainability of appeal - On the issue of whether rebate claim against supplies made to SEZ a re appealable to the Tribunal or to Revisionary Authority, Larger Bench in appellant's own case - 2015-TIOL-2823-CESTAT -MUM-LB has held that the appeal does not lie with the Tribunal and the revision application would lie before the Revisionary Authority, Government of India - as appeals are not maintainable, the same are dismissed - appellants have liberty to file revision application before Revisionary authority and period of limitation should be reckoned from date of the present order: CESTAT [para 1, 2]


Polaris Cables & Wires Pvt Ltd Vs CCE (Dated: November 26, 2015)

CX - Appellant clearing finished goods 'Cables & Wires' to a unit in SEZ under CT-3 certificate during April 2007 to December 2008 - since appellant had availe d CENVAT credit on inputs which were utilized for manufacturing such cables & wires, they were unable to utilize the credit for payment of duty for home clearances and, therefore, filed refund claim u/r 5 of CCR r/w notfn. 5/2006-CE(NT) which was rejected - appeal to CESTAT. Held: There is no dispute that the finished goods were cleared to a unit in SEZ which would amount to export as per the provisions of s.2(m) of the SEZ Act - so also, section 51 of the SEZ Act provides that the Act shall have overriding effect on any other law for the time being in force which means that the provisions of SEZ Act need to be referred to as to whether clearances amounts to export - clearances made by appellant have to be considered as "export" - identical issue was decided by the Gujarat High Court in the case of NBM Industries in favour of assessee - order of lower authority is not sustainable and is, therefore, set aside - Appeal allowed with consequential relief: CESTAT [para 6.4, 6.5, 6.6]


CCE Vs Mahindra And Mahindra Ltd (Dated: January 11, 2016) CX - Respondent assessee clearing prototype vehicles for trials - upon rejection of request for exemption in terms of notification 161/71-CE assessee discharged CE duty along with interest before issuance of SCN - later, SCN issued for imposition of penalties u/r 173Q of CER, 1944 & rule 25 of CER - Penalty equivalent to duty of Rs.12,14,259/- imposed - Commissioner (A) allowing appeal of assessee and, therefore, Revenue in appeal. Held: Respondent right from beginning had informed the department regarding removal of 105 prototype vehicles and they have bonafidely claimed exemption under Notification No. 161/71 and on rejection of the request for extending the benefit of the said notification by the department, they cleared the vehicles on payment of duty taking the highest approximate value of the vehicles - No mala fide intention found on the part of the respondent and the facts clearly show that there is no intention of evasion of any duty - Commissioner (Appeals) has rightly dropped the penalty - Revenue appeal dismissed: CESTAT [para 5]


Hindustan Unilever Ltd Vs CCE (Dated: February 5, 2016)

CX - Application seeking extension of stay on the ground that appeal has not come up for disposal for no fault of theirs - Tribunal has in the case of Venketeshwara Filaments Pvt. Ltd. - 2014-TIOL-2388-CESTAT-AHM has held that stay which was in force beyond 07.08.2004 would continue till disposal of the appeal - application allowed: CESTAT [para 2, 3]


CCE Vs Bombay Oxygen Corporation Ltd (Dated: January 20, 2016) CX - Respondent, manufacturer and supplier of gases, receiving cylinders from various customers in which they fill the gases and sell it back to them - cylinders are required to undergo certain test and customers ask respondent to conduct test before filling the gases in cylinders - Revenue alleges that the said charges recovered should be added to Assessable value of gases supplied - Commissioner (A) allowing appeal of assessee, hence Revenue in appeal. Held: Case of respondent is squarely covered by the decision in Goyal M G Gases - 2014-TIOL-1430-CESTAT -DEL and Punjab Alkalis - 2004-TIOL-228-CESTAT -DEL where it is held that the said charges would not be includible in the AV as the charges are received from customers for an entirely different activity and has no connection with manufacture of gases - Revenue appeal dismissed: CESTAT [para 4]


Mafatlal Industries Ltd Vs CCE (Dated: December 1, 2015) CX - Whether the appellant has correctly availed the CENVAT credit on yarn which was purchased locally on payment of duty or otherwise; whether the appellant is required to be directed to pay an amount which is equal to 5 per cent or 10 per cent of the value of the finished goods which were exempted and cleared for export. Held - When the clearances are effected to the sister unit, appellant availed the benefits of Notification 05/98-CE and paid concessional rate of duty of 5 per cent, hence it cannot be said that appellant had manufactured only exempted goods out of the duty paid yarn purchased by them - There is no dispute that the grey fabrics which were manufactured and cleared for export, are exported - Appellant did not execute any bond for export of the grey fabrics as required on an understanding that the clearances were exempted from payment of duty - Ratio of the judgement in the case of Well Known Polyesters Ltd. - 2011-TIOL-989-CESTAT -AHM would cover the issue in hand as it is held that the conclusion in the impugned order that appellant is not eligible for exemption since the goods have not been exported under bond or LUT cannot be sustained - Order set aside and appeal allowed: CESTAT [para 6.5, 6.9]


Jsw Steel Coated Products Ltd Vs CCE (Dated: January 22, 2016) CX - CENVAT - Capital goods are not used exclusively for producing electricity that is wheeled out, therefore, there is no bar on availment of Capital goods CENVAT credit: CESTAT [para 5.1]

CX - CENVAT - Commissioner has held that some items cannot be called as capital goods but can be treated as inputs - So long as credit is allowable either as Capital goods or as inputs, demand cannot be sustained - as far as items G.I. Plate scrap, shrinkkomp-30 and FRP Motor co ver is concerned, no reason is given by adjudicating authority for denial of the credit - since credit cannot be denied without any reason, arbitrarily, credit is admissible - appeal allowed: CESTAT [para 5.1.1]

CX - CENVAT - it is also alleged that since appellant is using services for production of electricity, which is an exempted product, appellant is not entitled to take credit of tax paid on input services in terms of rule 6(1) of CCR. Held: it is apparent that appellants are using the said input services for production of electricity which is in turn used for manufacture of final products which are dutiable - however, a certain part of

electricity is sold for which they have been availing benefit of rule 6(2) of CCR inasmuch as they are availing credit of only that portion of duty paid which proportion is used captively in production of dutiable goods - as CCR rules are common for both, inputs and input services, SC decision in Maruti Suzuki Ltd. - 2009-TIOL-94-SC-CX will apply - therefore, there is merit in appeal - appeals are allowed: CESTAT [para 5.2]

CX - CENVAT - demand concerns an amount equal to 5% upto 31.03.2012 & 6% from 01.04.2012 onwards, on the value of electricity sold to MSEB which was exempted from payment of CE duty in terms of rule 6(3)(i) of CCR, 2004. Held: in the case of MIRC Electronics - 2013-TIOL-1761-CESTAT -MUM it is held that rule 6(3) can be invoked only if it is found that appellant has failed to follow previous provisions of rule 6 of CCR - as the appellant has taken credit only to the extent of credit eligible to them demand u/r 6(3)(i) cannot be invoked as the rule comes into play only when there is a wrong and excess availment of credit - appeal allowed: CESTAT [para 5.3]


Rathi Transpower Pvt Ltd Vs CCE (Dated: February 10, 2016) CX - Section 4 of CEA, 1944 - Assessable Value - Appellants were selling excisable goods to various distributors and dealers and had an agreement with some of them in which they were sharing cost of advertisement on optional basis - Revenue seeking to add the amount recovered from dealers/distributors in Assessable Value and demand confirmed - appeal to CESTAT. Held - From terms of the agreement, it is very clear that it is an option to the dealer to obtain advertising materials from appellant at 50% of cost - it is also not disputed that only some dealers availed this option - it, therefore, can safely be concluded that it is not mandatory for dealers to take the advertising materials from appellants and share the cost of such materials - in view of Tribunal decision in Maruti Suzuki Ltd. relying upon the Apex Court decision in Philips India Ltd. - 2002-TIOL-127-SC-CX no cause for including such cost in A.V - order set aside and appeal is allowed: CESTAT [para 5]


Aditya Birla Nuvo Ltd Vs CCE (Dated: February 29, 2016) CX - There is only one charging section in service tax i.e. Section 66 & Section 66A is merely a deeming provision - since tax was paid u/s 66 of the FA, 1994, hence the credit is admissible to the appellant - though the tax itself was not required to be paid before 18.04.2006, then in that case, credit is nothing but a refund of the tax erroneously paid - Appeal allowed: CESTAT [para 8, 9]



Narmada Offshore & Technical Services Pvt Ltd Vs CCE (Dated: January 27, 2016)

CX - Rule 8(3A) of CER, 2002 - Default in payment of duty and consequent requirement to discharge duty from current account (cash) and not through CENVAT account - Duty demand confirmed for payment in cash and imposition of equal penalty u/r 25 of CER, 2002 - appeal to CESTAT. Held: Rule 8(3A) of CER, 2002 has been struck down by High Court of Gujarat, Madras and Punjab & Haryana in various cases and, therefore, no duty and penalty can be imposed - since the rule under which the entire proceedings have been initiated have been declared unconstitutional, no liability arises under the said rules - Order set aside and appeal allowed with consequential relief: CESTAT [para 9]


Pennzoil Quaker State India Ltd Vs CCE (Dated: February 11, 2016) CX - During the Audit of Central Excise records, the auditor verified the form 3CD (Audit Report) under the Income Tax Act for the period ending March 2000 and March 2001 and observed shortages in respect of certain finished goods and raw materials - appellant was issued a SCN demanding CE duty of Rs.37,44,287/- along with interest and penalty and which was confirmed by Commissioner - Appellant before CESTAT. Held: Base oil being a petroleum product, its weight and volume is dependent upon temperature and density - At the time of receipt in the factory, base oil is emptied in tank and the procedure for determining the weighment is by deducting the gross amount of weight of tanker including the oil and reducing therefrom the weight of the tanker after discharging the oil considering the density and temperature - This method sometimes results into shortage or excess quantity of base oil to the extent of 1 to 2% and this is well recognized within the petroleum industry for petroleum products whereas in this case, the shortage as reported in annexure A to form 3CD during the period 2000-01 has only been to the extent of 0.6% of the total consumption which can arise on account of variation in temperature, variation in viscosity while dip reading, temperature and density at the time of measurement of stock - such loss due to storage and handling petroleum products in a refinery is condonable in terms of Circular 55/89-CX.8 dated 15.12.1989 - demand to the said extent on alleged shortage of raw materials at the factory is not sustainable: CESTAT [para 6.1]

CX - similarly, as far as shortage of finished goods at factory and depots is concerned, appellant has debited duty on his own and informed the department vide various letters - keeping in mind that shortages are very minor in nature i.e 0.6% which is well accepted in petroleum industry and moreover there is no allegation that there is clandestine removal of goods, therefore, demand to the said extent is also not sustainable: CESTAT [para 6.2]

CX - Limitation - SCN served on 26.03.2004 and relates to the period FY 1999-2000 & 2000-2001 issued on the basis of shortages of raw material and finished goods shown in form 3CD (i.e report under Income Tax Act) which is a statutory report and which was furnished by appellant before the audit party - moreover, regular stock taking was being conducted in the factory and whenever there was a shortage in finished goods, appellant was informing department and debiting CE duty - it cannot, therefore, be said that appellant has suppressed material facts with intent to evade duty - no evidence of clandestine removal also - demand hit by limitation - Appeal allowed: CESTAT [para 6.3, 7]


CCE Vs M/s Suessan Asia Pvt Ltd Satara (Dated: January 15, 2016)

CX - Imported used capital goods cleared under letter of undertaking (UT-1) without payment of duty - Revenue asking respondent assessee to reverse credit - Commissioner (A) setting aside o-in-o and allowing appeal - Revenue in appeal before CESTAT. Held: In case of export of any goods, duty suffered on such goods need not be exported, therefore, export shall be made under claim for rebate or under bond - from paragraph 3.4 of Chapter 5 of CBEC Supplementary Manual which is pari materia to the provisions of erstwhile rule 57AB of CER, 1944 export of capital goods under bond is permissible - no need to reverse credit already availed - no merit in appeal of Revenue, hence dismissed: CESTAT [para 5]


Thermodors Pvt Ltd Vs CCE (Dated: February 4, 2016) CX - Classification - Fibre Glass Reinforced Plastic namely Missile container, logistic container - Appellant claiming classification under CSH 7014.00 and Revenue classifying goods under CSH 3923 - Revenue succeeding in appeal before Commissioner (A) so assessee before CESTAT. Held: Missile containers are manufactured out of two main ingredients i.e. Plastic and Glass Fiber; Plastic content in the product is to the extent of 39% and Glass Fiber is 33% - Any container manufactured is liable to be classified depending upon the raw material used - In case of goods manufactured with various materials, then being a composite product, classification shall be based on the predominant ingredient contained - as, in present case pre -dominant input is plastic as compared to Glass fiber, therefore, product Missile Container merits classification under Chapter 39 and not under Chapter 70 - submission that classification should be based on the end use is not correct for the reason that there is no specific tariff entry for mis sile container in the Central Excise Tariff Act - Order passed by Commissioner (A) is just and proper and needs no interference - Assessee appeal dismissed: CESTAT [para 6]


Vatan Textiles Ltd Vs CCE (Dated: February 9, 2016)

CX - Notification 53/97-CE - Appellant had cleared fabrics, which they claimed to be semi-finished goods, for the purpose of job-work and the same were not returned - Appellants are hit by clause (7) of the Notification and as a result, duty is chargeable on the material cleared for job-work in terms of such clause - Order of Commissioner (Appeals) to this extent is according to the provisions of such Notification as he has ordered the matter to be remanded for determination of duty, if any, - Appeal dismissed: CESTAT [para 3, 3.1]


Hindustan Zinc Ltd Vs CCE&ST (Dated: December 31, 2015 ) CX - Assessee engaged in manufacture of Lead and Zinc Concentrates - Credit denied on various goods - Applying user test, it is clear that disputed items were forming part and parcel of overall capital goods of various descriptions and use - Structural items such as angles, channels and rods required to make machines functioning without any vibration or movement eligible for cenvat credit - Impugned order is not sustainable: CESTAT


John Deere Equipment Pvt Ltd Vs CCE (Dated: August 31, 2015) CX - Notification no. 23/2003-CE - There is no statutory requirement to furnish any evidence of discharge of VAT liability - The competent authority for implementation of VAT collection is the State government and it is not within the assigned responsibility of CE authorities to ascertain compliance or to predicate the grant of exemption to such compliance - Appeals allowed: CESTAT [para 10 to 17]



CCE Vs M/s SPIC Pharmaceuticals Division (Dated: October 28, 2015)

Central Excise - MODVAT - Omission to discharge duty liability by Indian Oil Corporation on furnace oil sold to Respondent against an invoice showing payment of excise duty, imposition of penalty on Respondent is wholly unjustified and unsustainable - Respondent has no control over IOC and is not liable if supplier had or had not paid proper duty - Appellate Commissioner rightly granted relief to the assessee - Impugned order does not suffer from any infirmity - Appeal is dismissed. (Para 5, 6)


M/s Hindustan Zinc Ltd Vs CCE & ST (Dated: January 25, 2016) CX - Input service - It is settled law that statute should be so interpreted as not to render, to extent possible, the words used by legislature redundant - Rent a cab service availed for transportation of children of employees from colony to school and back is not an input service in terms of Rule 2(l) of CCR, 2004 - Appeal partly allowed only to extent of setting aside penalty: CESTAT


Simbhaoli Sugars Ltd Vs CCE (Dated: January 06, 2016) CX - When supporting structures are essential part of machinery, in order to manufacture taxable output, Cenvat credit is available - There is no element of concealment or contumacious conduct on part of assessee and issue is wholly interpretational in nature - In view of fact that revenue also had information of taking of Cenvat credit in view of earlier SCN for preceding period, Tribunal held without entering into merits, that demand for extended period, cannot be sustained - Impugned order set aside and appeal allowed: CESTAT


IOC Ltd Vs CCE (Dated: January 12, 2016) CX - Refund - Assessee is registered with CE authorities at Partapur as well as at Mathura - Assessee paid excess duty on an amount which was charged from dealers in Partapur area - However, for supplies made to Noida & Bulandsahar area, where lower transaction price was agreed upon as compared to Partapur, duty was paid at higher value but duty at lower value was recovered from dealers of Noida & Bulandsahar at agreed upon price - Transaction value under existing Section 4 cannot be fixed based on place of clearance alone but has to be seen alongwith fact as to what is agreed upon price for purpose of determining transaction value - Assessee on merits has correctly filed refund claims alongwith requisite documents and calculations.

Unjust enrichment - Once documentary evidences/certificates have been produced by assessee to effect that excess duty paid has not been recovered from dealers then it has to be held that assessee has discharged its onus of non-recovery from customers/dealers as per Section 11B of CEA, 1944 - In absence of any such counter, it is held that unjust enrichment is not applicable to existing facts on records: CESTAT


Hyundai Motor India Ltd Vs CCE & ST (Dated: December 01, 2015)

Central Excise - Valuation - HMIL, manufacturers of motor vehicles (passenger cars) falling under Chapter Heading 8703, cleared the cars to their dealers as well as through their depot located across the country, under provisional assessment - the adjudicating authority finalized the provisional assessments periodically and issued orders - The orders included certain elements in the AV, disputed by assessee; and excluded certain elements therefrom, disputed by the department - The main issues which are relevant to these appeals are: (1) Non-inclusion of cost of Pre -Delivery Inspection (PDI) and After Sales Service (ASS) in the assessable value and consequent short payment of duty; (2) Non-inclusion of overriding commission paid to dealers on sale to canteen store-department (CSD); (3) Demo Cars; (4) Cost of display kits collected from dealer through debit note; (5) Recovery of incentive trip cost from dealers; (6) Non-inclusion of profit margin at HMP; and (7) Incorrect availment of Cenvat credit on fabricated paint shop structurals.

Held: (A) Issue - PDI/ASS charges : Subsequent to the Tribunal's LB decision in the Maruti Suzuki case, the High Court of Mumbai in the case of Tata Motors Ltd. held PDI charges not includible and quashed the Board's circulars dt. 1.7.2012 and 12.12.2002 - The Bombay High Court has discussed the issue of PDI charges and ASS charges at length within the scope of Section 4 and also taken into consideration the LB decision of Maruti Suzuki India; and held that Board's circular referred to above are not inconformity with provisions of Section 4 of Central Excise Act - The ratio of the Bombay HC ruling is squarely applicable to the present case inasmuch as the PDI is mandatory before sale of cars to ultimate customers and Revenue has filed the present appeals on the inclusion of PDI/ASS charges solely on the basis of the Board's circulars dt. 1.7.2002 and 12.12.2002 - The fact that co-ordinate Benches of the Tribunal in subsequent decisions have decided the PDI issue by following the ratio of the Bombay High Court order, confirms the view that the ratio of High Court decision is applicable - PDI/ASS charges are not includible in the transaction value of cars cleared by the assessee; the orders of Commissioner (Appeals) to the extent of non-inclusion of PDI charges/ASS charges are upheld; orders passed by Commissioner, LTU confirming the demand on PDI and the penalties are set aside; and the assessee's appeals are allowed on this issue. [Para 25]



M/s Abdos Oil Pvt Ltd Vs CCE (Dated: November 30, 2015) CX - Cenvat credit alongwith interest was decided against assessee by Adjudicating authority on the ground that dutiable moulds after purchase by assessee were directly sent to job worker without being brought into their factory premises - Under Rule -4(5)(b) moulds can be sent to job worker but no condition, like its receipt back within 180 days as prescribed in Rule-4(5) (a) of CCR, 2004 is specified - Purpose of bringing moulds first to factory premises and then clearing same to a job worker may not serve any purpose except for incurring some additional transportation cost to assessee - It is an accepted norm that raw materials can also be directly sent to job worker without being actually brought into factory of an assessee: CESTAT


M/s Bhargava Poly Vinyle Pvt Ltd Vs CCE (Dated: November 30, 2015) CX - Cenvat credit on capital goods - Appellant company have a vailed Cenvat credit on capital goods in year 2005-06 on which they have claimed depreciation under section 32 of Income Tax Act - Prior to issue of SCN, after date of inspection, assessee filed revised I.T. Return and withdrawn the claim of depreciation on capital goods in question - As assessee have withdrawn claim of depreciation, denial of Cenvat credit along with penalty imposed under Rule 15 r/w Section 11 AC of the Act

is set aside.

Shortage of material - Panchanama is silent on method of stock taking - It does not disclose mode of physical verification - Contention of assessee that stock taking was done by way of eye estimation, is held tenable - Demand in respect to shortage of raw material along with penalty on appellant company as well as penalty on authorized signatory, Mr. Vipin Bajaj is set aside: CESTAT


Thermax Ltd Vs CCE (Dated: February 12, 2016)

CX - Notfn. 22/03-CE - non-receipt of warehousing certificate - since the consignee has paid duty, the department cannot recover the duty twice for the same consignment from the consignor and moreover as per Rule 20(3) of CER it is the responsibility of the buyer to pay the duty - Demand also time barred as Revenue had failed to prove suppression of facts with intent to evade duty - Appeal allowed with consequential relief: CESTAT [para 7, 8]



Kali Aerated Water Works Vs CCE (Dated: October 15, 2015)

Central Excise – SSI Exemption - appellants are manufacturers of Aerated Water and soft drinks under the brand name of "Kali Mark"- They marketed various flavours in the name of "Kali Kola", "Bovonto", "Solo", "Frutang", "Captain", "Trio", "Club Soda"etc., and claimedvalue based exemption under Notification No. 8/2003-CE dated 01.03.2003 as amended - benefit of exemption denied in adjudication, on the ground that the brand name of "Kali Mark", ‘Bovanto and Frutang are the brand name of other persons - duty demands with interest under Section 11 A (1) and 11 AB of the CEA, 1944; and penalty under Rule 25 of Central Excise Rules, 2002 adjudicated, upheld by Commissioner (Appeals), and agitated herein.

Held: The Tribunal, in the appellant's own case, discussed the issue in detail; denied the SSI exemption benefit, and allowed the Revenue appeal - the Supreme Court in the appellant's own case, set aside the order of the Tribunal and held that the appellants are the owners of the brand name, in terms of family arrangement- Since the Apex Court has settled the issue of using the brand name and trade name in the appellant's own case, following the same, the appellants are using their own brand name and are eligible for SSI exemption under Notification No. 8/03-CE dated 01.03.2003 - Hence, penalties involved in all the appeals are not sustainable; accordingly, all the impugned orders are set aside.[Para 5, 6]


K P Pouches Pvt Ltd Vs CCE (Dated: February 2, 2016) CX - Assessee engaged in manufacture of "gutkha" with "Raj Shree" and "Safal" brand - As regards to physical seizure of 50 bags of gutkha from vehicles, assessee have admitted unaccounted clearance and discharged duty liability - Clandestine clearance of dutiable items have been brought forward with corroborative evidences from more than one source and there is no discrepancy while collating such evidences - Their only objection is that more corroboration regarding actual buyers of clandestinely removed goods and details of money received is not available - Purchase of raw materials is also on cash basis without any accounting - Entries and contents of

private records in form of kachcha slips recovered from drivers of vehicles - Case is not the one which is based only on statement of Director of assessee's company - It is based on private records seized from transport drivers corroborated by three different persons - Unaccounted production and clearances were evidenced by categorical admission of Director and Supervisor of assessee's company and there were kachcha slips seized along with goods: CESTAT


M/s RR Donnelley Publishing India Pvt Ltd Vs CCE(Dated: October 6, 2015) Central Excise – Refund - issue involved in this appeal is whether the Cenvat credit availed on the input services utilised for manufacture of goods at 'nil' rate of duty supplied to the SEZ as well as exported, shall entitle the appellant to the refund of the Cenvat credit under Rule 5 of Cenvat Credit Rules, 2004.


M/s Pepsico India Holdings Pvt Ltd Vs CCE (Dated: October 7, 2015) Central Excise -Demand –Duty demand adjudicated on broken glass bottles, on the ground that credit was availed when unbroken; and agitated herein.


M/s Zabatex Textiles India Pvt Ltd Vs CCE & ST (Dated: December 22, 2015) CX - CENVAT - Credit of Additional duty leviable under CTA, 1975 - Clarification/amendment made in the Rule 3(7) of CCR, 2004 in 2009 by notfn. 22/2009-CX(NT) is only for the purpose of removal of doubts and not for any other reason - denial of credit for the earlier period has no rationale - Appeal disposed of: CESTAT [para 4 to 7]



M/s Essar Steel India Ltd Vs CCE & ST (Dated: February 4, 2016) CENVAT credit on Sales Commission - Explanation inserted in Rule 2(l) of CCR, 2004 by Notification No. 2/2016-CX(NT) is declaratory in nature and effective retrospectively – Credit admissible - Appeal allowed: CESTAT [para 19, 20, 21, 22, 24]



Hindustan Zinc Ltd Vs CCE (Dated: February 2, 2016) CX - Rule 2(l) of CCR, 2004 - Input Service - Staff colony provided by the company is directly and intrinsically linked to its manufacturing activity - Cost necessarily forms part of business expenditure captured in the assessable value of their final product - Consequently, the services which were crucial for maintaining the staff colony a re

Input services - Credit admissible, appeal allowed: CESTAT [para 4, 5]



CCE Vs Supreme Petrochem Ltd (Date: October 5, 2015)

Central Excise - Amalgamation/Merger of companies into one unit - Transfer of unutilized CENVAT credit post amalgamation - Admissible - Amalgamation is not mere transfer of capital goods from one unit to another - Post amalgamation, new entity held is entitled to Cenvat credit which was lying unutilized in the accounts of the amalgamating company - No infirmity in the order of Appellate Commissioner allowing transfer of unutilized credit at the time of amalgamation - Revenue appeal hence is without merit hence is rejected. (Para 5-7)


Man Structural Pvt Ltd Vs CCE (Dated: January 22, 2016) CX - Availability of cenvat credit on goods, where same were used for fabrication of various machines/machinery installed within factory - Assessee engaged in manufacture of Tower material falling under chapter 73 of CETA, 1985 - When assessee had a decision in his favour, it was reasonable on its part to hold a belief that Cenvat credit was available - There is no specific allegation levelled against assessee concerning fraud, collusion and suppression with intent to evade payment of duty, therefore, extended period of limitation cannot be invoked for denial of cenvat benefit to assessee - Impugned order set aside: CESTAT


CCE Vs Godawari Power And Ispat Ltd (Dated: January 14, 2016)

CX - Whether assessee is liable to pay 8% or 10% of value of electricity cleared outside in terms of Rule 6 of CCR, 2002/ 2004 - Assessee have calculated and debited credits attributable to such electricity cleared outside even before issue of notice - They have not taken any undue benefit and they have reversed the credit attributable to electricity cleared outside - There is no cause for initiating action for recovery of 8% or 10% of value of such electricity - Department's appeal against impugned order is without merits: CESTAT


CCE Vs Plastika Industries (Dated: December 02, 2015) CX - It is undisputed that plastic waste and scrap which gets generated during the manufacture of final products are sent to job-worker and received back as granules which are further consumed in the manufacture of final products on which duty is paid - Benefit of notfn. 214/86-CE cannot be denied - Revenue appeal devoid of merits, hence rejected: CESTAT [para 6, 7, 8]



Rosana Tools Vs CCE (Dated: December 03, 2015) CX - Appellants are manufacturing dies blocks and moulds and cutting dies and in addition to such activity also undertake repair and rectification of the dies blocks, cutting ides and moulds as sent by their customers and charge separately as labor charges - Revenue allegation is that the same is an additional consideration and should be included in AV for the purpose of payment of duty - demand confirmed along with interest and penalty - appeal to CESTAT. Held: Since the amounts received by the main appellant is for the repairing/reconditioning of old used dies and machinery metal part, the amounts on which duty liability is confirmed along with interest is incorrect and should not have been included for discharge of duty liability as the said amount is not for any manufacturing activity - since demand set aside, penalty & interest also does not survive - Appeal allowed with consequential relief: CESTAT [para 10, 11]


Weizmann Ltd Vs CCE (Dated: October 13, 2015) CX - Penalties imposed on 31 appellants under rule 26 of CER - provisions of rule 26 are more stringent than imposition of penalties under rule 25 - moreover, if anybody is availing cenvat credit, the burden to prove regarding eligibility or correctness is on such person - in the present case, imposition of penalty u/r 26 is decided based on evidences available and the sufficiency of such evidences - where there is no evidence to indicate that the appellant had knowledge that the goods received by them are liable to confiscation, no penalty can be imposed - in those cases where appellant had reason to believe that the goods are liable to confiscation, penalty is imposable, however, it is not coming out from the SCN about the value and the duty involved on such goods and, therefore, penalty imposed is reduced - Appeals partly allowed: CESTAT [para 36]


CCE Vs M/s Blue Star Ltd (Dated: January 15, 2016) CX - Rule 57CC of CER, 1944, s.11D of CEA, 1944 - Revenue cannot insist that the respondent should have compulsorily availed the exemption notifications nos. 17/98-CE & 5/99-CE as prior to insertion of sub-section 5A(1A) w.e.f. 13/5/2005 it was not mandatory for an assessee to avail the exemption notification - Appeal dismissed: CESTAT [para 6]



CCE & ST Vs M/s Lupin Ltd (Dated: December 31, 2015) CX - Issue raised in SCN is admissibility of cenvat credit on the outdoor catering service – Revenue in appeal - As regard the cost of food recovered from the employees, it only decides the quantum of the cenvat credit which is admissible - it is not a fresh issue as the same co -exists in the issue of admissibility of cenvat on outdoor catering service – Matter remanded for working out the quantum of credit admissible – no penalty imposable as issued involved interpretation of provision of CCR: CESTAT [para 6]



Ampson Engineering Pvt Ltd Vs CCE (Dated: December 16, 2015) CX - Modification carried on Moulds & dies received from supplier unit does not amount to manufacture u/s 2(f) of CEA, 1944 - moreover, supplier unit manufacturing plastic products, by using Moulds & dies, can send the said Moulds & dies in terms of rule 4(5)(a ) of CCR and appellant can recondition the same and operate under exemption notification 214/86-CE - No cause for demand of CE duty - Appeal allowed with consequential relief: CESTAT [para 6]



CCE Vs Ruby Mills Ltd (Dated: November 4, 2015) CX - Valuation - Assessable value should be the value worked out based on the cost of the material and the job-work charges - Revenue's claim that the respondent had collected over and above the job-charges in the form of cutting, checking and packing of the processed fabrics is without any evidence and there is nothing on record to indicate that these charges were not included in the job-work charges which were being paid by the said Risha to the respondent - In the absence of any such evidence, findings of the first appellate authority are correct and do not require any interference - Revenue appeal rejected: CESTAT [para 9 to 12]


Mahanagar Gas Ltd Vs CCE (Dated: January 6, 2016) CENVAT - Argument that the CNG needs recompression at DBS in order to fill the product into vehicle is without any merits inasmuch CNG is already a marketable commodity, and the activity of recompression is neither incidental nor ancillary for manufacture of CNG at DBS - Recompression of CNG at DBS does not bring into existence any new product which is distinct - Credit rightly denied on Cascade - Appeals rejected: CESTAT [para 5.2, 5.3, 6] Also see analysis of the order


Bharat Bijlee Ltd Vs CCE (Dated: December 4, 2015)

CX - Additional testing which is carried out on the transformer by the appellant is at the behest of their customers - no evidence gathered by Revenue to disprove the claim of appellant - cost of additional copies of drawings given to appellants' customers on specific request cannot form a part of the assessable value as these costs are post manufacturing and clearance - Costs of Additional testing and documentation charges are not included in AV - Demand set aside and appeal allowed: CESTAT [para 7, 9, 10]



CCE Vs Dhariwal Industries Ltd (Dated: December 4, 2015) CX - Limitation, Penalty - There are no provisions to demand any duty beyond the period of 5 years from the date of show cause notice - Adjudicating authority has correctly followed the law and has held that when the demand is not sustainable on the question of limitation, penalties cannot be imposed on the assessee under the CER, 1944 - adjudicating authority was correct in dropping the proceedings initiated for imposing penalties on the respondent - Order does not require any interference - Revenue appeal rejected: CESTAT [6.1]


Icconol Petroleum Pvt Ltd Vs CCE (Dated: October 16, 2015) CX - Clandestine clearances without payment of CE duty - Other than the 8 invoices, there is no evidence produced by the Revenue in support of the allegation of clandestine removal as alleged on the basis of parallel invoices - It is settled law that in case of allegation of clandestine clearances, the onus is on the Revenue to produce copies of the invoices etc. in support of its allegation - In the absence of such parallel invoices, the allegation cannot survive - Revenue has also not brought anything on record to support any unaccounted acquisition/procurement of inputs (raw materials), rather the inputs of the appellant are acquired from the PSU and the same are duly accounted for and duty paid - Revenue has made out a half baked case of clandestine removal and the same is not sufficient save and except the 8 parallel invoices, duty in respect of which has been accepted by the appellant - It is also a settled law that a confessional statement cannot be the sole basis for establishing clandestine clearance in absence of other corroborative evidences - duty confirmed of Rs.92,144/- along with interest which is to be adjusted against amount of pre -deposit made - penalty reduced to the extent of demand confirmed - personal penalty on MD and Director also reduced - penalties imposed u/r 26 of CER on various buyers is set aside - confiscation of goods also set aside - Appeal allowed in part: CESTAT [para 7, 8]


MUKAND LTD Vs CCE (Dated: September 16, 2015)

CX - CENVAT - It is an admitted fact that the sheets in question on which Cenvat Credit have been availed have been utilized for providing cover to the machinery and its moving parts in order to protect them from dust particles etc., and to maintain temperature for good quality of output, more particularly in view of the fact that the factory is fitted with overhead cranes which runs on gantry throughout the factory shed form one corner to other - As such, there is a probability of the raw materials falling on the machines and its moving parts - Further, it is not disputed by Revenue that the sheets in question have been utilized to provide cover to the accessories in the automatic wire mill plant - In this view of the matter, appellant is entitled to Cenvat Credit as the sheets so utilized partake nature of accessories of the capital goods and as such are capital goods as defined in Rule 2(a)A(iii) of the CCR, 2004 - Re-credit allowed of the amount reversed by the appellant - interest paid is to be refunded to appellant in cash within 45 days by adjudicating authority - Order set aside and appeal is allowed: CESTAT [para 7]


Nirmala Process (Bom) Pvt Ltd Vs CCE (Dated: November 18, 2015) CX - It is also not disputed that the appellant has exported the entire fabrics manufactured by them, hence they are not in a possession to utilize the CENVAT Credit availed as there are no home clearances - rejection of refund claim by the authorities on the ground that the refund is not allowed of credit taken under Rule 9A,

whereas the refund is only allowed in respect of CENVAT Credit on inputs availed as per Rule 3 of the Cenvat Credit Rules, 2002 is not in consonance with the law - issue of availment of CENVAT Credit under Rule 9A of the Cenvat Credit Rules, 2002 on the goods lying in stock has been settled by Bench in the case of P.K. International - 2014-TIOL-1779-CESTAT-MUM - there cannot be second opinion that if the refund is delayed by the department, the interest liability arises in order to meet end of justice - order is set aside and the appeal is allowed with consequential relief: CESTAT [para 5, 6]


M/s United Phosphorous Ltd Vs CCE & ST (Dated: September 30, 2015)

CX - Old s.4 of CEA, 1944 - Valuation - After clearance from fa ctory, goods may be sold from the depot at a higher or lower price & the assessee is not entitled to claim the refund for lower price & the Dept. also cannot demand the duty of higher price at depot - Assessee Appeal allowed: CESTAT [para 8, 10, 11, 13, 14, 15, 17, 18]



Indus Paper Boards P Ltd Vs CCE (Dated: October 09, 2015)

CE - Decision of LB in the case of Sterlite Industries Ltd. relies on the spirit of the MODVAT Rules and no specific rules - Ratio is equally applicable to CCR, 2004 – Inputs used for job work are entitled to CENVAT credit


Mpi Paper Pvt Ltd Vs CCE (Dated: January 06, 2016)

CE - Decision of LB in the case of Sterlite Industries Ltd. relies on the spirit of the MODVAT Rules and no specific rules - Ratio is equally applicable to CCR, 2004 – Inputs used for job work are entitled to CENVAT credit


2016-TIOL-476-CESTAT-MUM

Suyash Chemicals Vs CCE (Dated: December 22, 2015)

CE - Rule 9(1)(c) of CCR, 2004 - Endorsed bill of entry is a valid document for availing CENVAT credit - There is no dispute as regards receipt of material and duty paid thereon - Appeal allowed: CESTAT [para 6, 7]


Vikas Laboratories Pvt Ltd Vs CCE (Dated: January 07, 2016)

CE - Appellant, a 100% EOU, availed credit of CHA services - In order to claim benefit of Notification No. 17/2009-ST, they reversed the CENVAT Credit so availed and in turn got refund of the Service Tax - SCN issued seeking to deny CENVAT Credit

availed in respect of CHA services - After observing that appellant had already reversed the tax credit to avail the refund under Notification No. 17/2009, the credit of Service Tax availed was denied as inadmissible - However, demand of interest was not confirmed so Revenue challenged the same & Commissioner (Appeals) allowed the Revenue's appeal on the ground that interest is required to be charged irrespective of the fact whether the credit was utilized or not - also relied on CBEC Circular 897/17/2009-CX dated 3.9.2009 - appeal to CESTAT. Held: Appellant is 100% EOU and not clearing any goods in DTA and, therefore, there is no possibility for them to avail the cenvat credit - In view of the decision of the Allahabad High Court in the case of Hello Minerals Water (P) Ltd. vs. UOI [ 2004-TIOL-57-HC-ALL-CX ] and decision in the case of Sagar Twisters vs. CCE, Mumbai [ 2005-TIOL-574-CESTAT-MUM ] followed in appellant's own case in Appeal No. ST/183/11-Mum vide Order No. A/559/14/SMB/C-IV dated 20.3.2014, reversal of CENVAT credit at the time of getting the refund claim amounts to non-availment of cenvat credit & there is no liability under section 11A(2B) of CEA, 1944 for payment of interest in the facts of the case - Order set aside and appeal allowed: CESTAT [para 4, 4.1, 5]


M/s HSR RE-Rolling Pvt Ltd Vs CCE (Dated: January 20, 2016) CX - Whole case of demand of excise duty on unaccounted, clandestine removal of re -rolled products of iron/steel was based on recovery of certain documents at raw material supplier's end and statement of Director of assessee - No verification at assessee's premises has been made during investigation - Though it is not feasible to have evidences on all aspects, it is certainly required to have at least a few corroborative evidence to assert clandestine receipt of raw material, manufacture and clandestine removal of dutiable final products - Penalty imposed on Director is set aside on ground that he has joined company on 01/7/2008 and as such was not involved in clandestine removal that happened during November 2007 to April 2008 - Whole case of clandestine manufacture and clearance is without sound basis of corroborative, admissible evidences - Impugned order set aside: CESTAT


Trimurti Fragrance Pvt Ltd Vs CCE (Dated: November 24, 2015) CX - Interest - Assessee is a manufacturer of pan masala and chewing tobacco and installed 12 pan masala packing machines - Sealing of 12 machines of assessee occurred prior to 1.7.2013 - Machines we re inoperative during 1.7.2013 to 7.7.2013 - Machines were unsealed and reinstalled on 8.7.13 - This is evident from abatement order dated 20.9.2013 - Under third proviso to Rule 9, duty was payable by 5th of August, 2013 while duty was in fact paid on 27th July, 2013 - Therefore, there is no delayed payment of duty warranting levy of interest under Section 11AA of the Act: CESTAT


National Impex Vs CCE, C & ST (Dated: November 2, 2015)

CX - Eligibility of benefit of exemption Notfn 125/84-CE - Assessee, a 100% EOU engaged in manufacture of Polyester Dupatta and Scarves and clearing goods under cover of ARE-1s without payment of duty under Rule 19 of CER, 2002 - Goods were cleared in 2003 but assessee had not furnished any corroborative evidence to establish export of goods till date - Hence, demand of duty is justified - There is no need to go into chargeability of duty of goods, as it is not the case of assessee - Hence, demands of duty alongwith interest is justified - No allegation of diversion of goods into DTA and therefore imposition of penalty under Section 11AC cannot be

sustained - It is not a fit case for imposition of penalty under Rule 25(1) - Once the firm is penalized, separate penalty is not imposable upon partner of firm because partner is not a separate legal entity and cannot be equated with employee of firm - Penalties imposed on same is set aside: CESTAT


Saint Gobin Gyproc India Ltd VS CCE (Dated: January 22, 2016) CX - Refund - Assessee had initially raised CE invoices reflecting assessable value and CE duty leviable thereon, which were paid by its customers - Upon finalization of discounts/incentives on schemes, assessee had issued credit notes to their customers, in adjusting discount amount from books of accounts - Jurisdictional Range Superintendent was informed that refund claimed amount has been shown as "claims receivable" in books of accounts, under head "Loans & Advances" and that such claimed amount do not form part of finished goods cleared during relevant period - Customers of assessee have also issued certificates, certifying that they have not availed any Cenvat credit of CE duty charged by assessee in their invoices and that final payment on account of goods have been made to assessee after adjusting amount mentioned in credit notes raised by them - Modus operandi adopted by assessee clearly demonstrate that they have neither recovered any amount in respect of discount from their buyers/dealers, nor have reco vered any amount representing duty of CE on such incentive amount - Hence, refund claim of assessee is not hit by doctrine of unjust enrichment: CESTAT


Uflex Ltd Vs CCE, C & ST (Dated: December 16, 2015) CX - Valuation - Whether assessee is correct in following Rule 8 and CAS-4 standard to arrive at value of captively consumed hard copy shim - Assessee engaged in manufacture of polyester film, shim, BOPP and articles of plastics - They are availing cenvat credit on various inputs, capital goods and input services - Hard copy shim is an excisable product manufactured and fully put to captive use - For arriving at value for Central Excise purpose, they followed provisions of Rule 8 and general principles of costings as per CAS-4 standards - Value of shim is arrived at from value of final product - hologram - by deductive method - This is not supported by any provisions of law or approved standards of accounting/costing.

Eligibility of assessee for exemption under Notfn 67/95-CE for captively consumed hard copy shim as capital goods - Assessee is not claiming any credit on capital goods - They are manufacturing capital goods and are claiming exemption under said Notfn - Commissioner's finding is absolutely without basis and is erroneous - A notfn has to be interpreted in light of words employed by it and not on any other basis - Exemption is to be applied by language and plain terms of notfn: CESTAT


A K R Poly Industries Vs CCE & ST (Dated: September 15, 2015) Central Excise - Appeal - Restoration Application - Applicant did not comply with the order to make pre -deposit of Rs. 3.5 lakhs and filed Writ Petition along with Stay before High Court which granted interim stay subject to payment of Rs. 1 lakh which was complied with in 2004 -Writ petition was finally disposed of in 2015 and in the mean time, in 2004, Tribunal dismissed appeal for non-compliance with pre-deposit order- Applicant made the balance pre -deposit and requested for Restoration of the appeal and submitted that they came to know of the dismissal only in 2015 - Revenue contends that it cannot be restored as there is a gap of 10 years between dismissal

and application for restoration and as the pre-deposit ordered in 2004 was made only in 2015 - It is pertinent to note that writ petition was all throughout pending before High Court till it's dismissal in 2015 -Immediately thereafter, applicant complied with Tribunal's pre-deposit order and only after depositing the balance amount, filed the application- Precedents allowed restoration when matter was pursued before High Court and subsequently complied with pre-deposit - In view of High Court's direction to consider restoration and with view that restoration will not cost any prejudice to either side, appeal is restored subject to payment of Rs. 10,000 as costs - Failure to comply with the condition results in dismissal of appeal - No application for restoration or extension of time shall be entertained - Application allowed. (paras 6, 7, 8, 9)

2016-TIOL-453-CESTAT -MAD-LB

ITC LTD Vs CCE (Dated: February 12, 2016) Central Excise Valuation - Inter Unit Transfer of goods among three units - cost of material at Second unit does not include notional profit of 15%/10%. - Rule 8 of Central Excise (Determination of Price of Excisable Goods) Rules, 2000.

Questions referred to the Larger Bench:

(i) Whether, in the case of inter-unit transfer of goods for captive consumption, the entire value (i.e. 115% / 110% of the cost of production) OR the actual cost of production (i.e. 100% of cost) excluding notional loading (i.e. 15°/o / 10%) of the goods manufactured by the one unit,, would be the cost of raw material of the another unit (who used the goods in the manufacture of another article) for the purpose of determining value under Rule 8 of Valuation Rules and CAS-4 issued by ICWAI, for transferring the goods to their other unit for further use.

(ii) Whether the decision of Chennai Bench in the case of CCE Vs Eveready Industries Ltd. - 2011-TIOL-1115-CESTAT-MAD (OR) the decision of Mumbai Bench in the case of Tata Iron and Steel Co. Ltd. Vs CCE - 2013-TIOL-707-CESTAT-MUM : had enunciated the correct position of law on the issue.



Elecon Engineering Co Ltd Vs CCE, C & ST (Dated: December 4, 2015) CX - Assessee received inputs in their factory in month of May 1999 and recorded in RG23A Pt.-I register within 6 months as provided under Rule 57 G of erstwhile CER, 1944 - They sent invoices to M/s Tisco for some rectification and therefore, CENVAT credit was not taken in RG23A Pt.I register immediately - They availed credit in RG23A Pt.II register during period from August 1999 to February 2000 as M/s. Tisco returned back of invoices after rectification - Time limit of 6 months from date of issue of duty paying document applied to receipt of goods in factory and not to process of taking credit - Impugned order cannot be sustained: CESTAT

2016-TIOL-450-CESTAT -CHD

M/s Carrier Airconditioning And Refrigeration Ltd Vs CCE (Dated: December 02, 2015) Central Excise - CENVAT Credit on various services like Renting of branch office,

Insurance service, Construction service, Travel Agent Service, Interior decorator Service and Architect Service denied in adjudication during the period prio r to and after 01.04.2011 - Appeal against denial of credit.



CCE Vs M/s Rohit Bal Designs Pvt Ltd (Dated: November 18, 2015) CX - Assessee is a fashion designer and engaged in manufacture of designer ready to wear garments - Tribunal agreed with finding of Commissioner (A) and hold that as assessee had purchased sarees and did embroidery and hemming work thereon will not change character of sarees, therefore, activity undertaken by them does not amount to manufacture as per Section 2 (f) of CEA, 1944, consequently, not excisable - No infirmity in impugned order, same is upheld: CESTAT


Jayant K Furnishers Vs CCE (Dated: October 15, 2015) CX - Appellant had undertaken turnkey contract for manufacturing of various furniture items at the site of the clients - further, appellant had sub-contracted the entire activity to contractor for completion of the work - CE duty demand made against appellant - appellant contending that even if manufacturing activity takes place, duty liability has to be discharged by the manufacturer, in this case, the sub-contractors - demand confirmed, so appeal to CESTAT. Held: Manufacturing activity of the furniture at the site is by the job worker and not the appellant - order confirming duty demand on appellant is incorrect and unsustainable - appeal allowed with consequential relief: CESTAT [para 5.1, 5.2, 6]


Tristar Equipment Pvt Ltd Vs CCE (Dated: November 19, 2015) CX - CENVAT - Rule 6 of CCR - It is not in dispute that the appellant had cleared the finished goods to various consumers without payment of duty on the basis of CT-2 certificate produced by such consumers - CT-2 certificate cannot be equated with the exemption is the law as settled by the apex court in the case of SRF Ltd. - clearances made under Chapter X procedure under bond is not the same thing as clearance of goods wholly exempt or goods chargeable to nil rate of duty, hence provisions of rule 57C are not applicable - Tribunal in case of Dharamsi Morarji Chemical Co. Ltd. - 2010-TIOL-586-CESTAT -MUM has also taken such a stand in the context of rule 6 of CCR, 2004 - no cause for the appellant to pay 8%/10% of the value of goods cleared on the strength of CT-2 certificate - Orders set aside and appeals allowed: CESTAT [para 6, 6.2]


Arbes Tools Pvt Ltd Vs CCE (Dated: January 8, 2016) CX - CENVAT - As per the Billa of Entry Regulation, 1976, courier bill of entry is a valid document for clearance of any imported goods - appellants have actually received imported goods and utilized the same in the manufacture of final product which is cleared on payment of duty - credit cannot be denied as ‘courier bill of entry' is to be treated as a valid document for claiming CENVAT credit under rule 9 of CCR, 2004 - Appeal allowed with consequential relief: CESTAT [para 5]


Uttam Galva Steels Ltd Vs CCE (Dated: December 2, 2015) CX - Oiling and Pickling of H.R Coils - Once the assessee considered the activity as amounting to manufacture and discharged the duty liability, the question of availing CENVAT credit cannot be disputed holding that there is no manufacture - CENVAT credit cannot be denied - Assessee appeals allowed & Revenue appeals rejected: CESTAT [para 7.1, 7.2, 7.3]



M/s V E Commercial Vehicles Ltd Vs CCE (Dated: January 17, 2016) CX - Appellant getting work done from job worker in terms of rule 4(5)(a) of CCR, 2004 - scrap generated at the premises of job worker was cleared by job worker but appellant were paying duty - on realizing that there is no duty liability at their end, refund claim filed but same rejected on ground that the scrap ought to have been brought back within 180 days which they failed and also no evidence produced to prove that there was no unjust enrichment - appeal to CESTAT.

Held: Bombay High Court in case of Rocket Engineering - 2006-TIOL-442-HC-MUM-CX has clearly held that there is no liability of the assessee sending inputs for job work in respect of scrap generated at job workers end - since appellant is not liable to pay any excise duty on such clearances, any amount paid on this co unt is refundable - as invoice was raised by job worker and appellant had no direct interaction with buyer of scrap, question of recovering any duty does not arise - moreover, debit was made much after actual clearance of scrap from job workers premises - order set aside and appeal allowed: CESTAT [para 4]


Electrosteel Castings Ltd Vs CCE (Dated: January 19, 2016) CX - In a case where excise duty was demanded and confirmed against M/s NOCIL by denying exemption notification 6/2002-CE, appellant was imposed penalty of Rs.5 lakhs u/r 26 of CER, 2002 - appeal before CESTAT - Appellant submitting that demand has been dropped and appeal has been allowed of NOCIL (now known as Relpol Pl astic) - 2013-TIOL-1433-CESTA-MUM , therefore penalty cannot stand. Held : As the duty demand has been dropped, penalty u/r 26 of CER which has been imposed consequential to duty demand is not sustainable - penalty set aside and appeal allowed with consequential relief: CESTAT [para 5]


Auro Oil Industries Vs CCE (Dated: January 1, 2016)

CX - Rule 8(3A) of CER, 2002 - Penalty imposed u/r 25 of CER, 2002 - There is no dispute that during the default period appellant have not paid duty on consignment basis, but on a monthly basis, therefore, there is a delay in payment of duty and the same attracts only interest - penalty is not warranted - appellant has not contested interest demand - Appeal allowed: CESTAT [para 6]


CCE Vs Kec International Ltd (Dated: January 27, 2016) CX - CENVAT - CCR, 2004 - Barbed wire is an anti-climbing device and the same is useful in protecting electric tower sub-station from any human or animal climbing and safeguards from any damage threat - bought out barbed wire supplied along with Transmission tower is an accessory and qualifies as Input under rule 2(k) of CCR, 2004 - as per the terms and conditions of the agreements, it is necessary for the company to supply barbed wire along with transmission tower - value of the barbed wire has been included in the assessable value and the duty has been paid on the whole amount - credit admissible - Revenue appeal dismissed: CESTAT [para 6.1 to 6.4, 7]



Wipro Ltd Vs CCE (Dated: September 30, 2015)

Central Excise - Input credit of CVD paid at the time of de-bonding utilized for payment of excise duty on clearance of finished goods de-bonded - Finished goods already suffered duty on debonding and appellant discharged excise duty liability on clearance of finished goods - Absent refund of additional duty of customs paid on debonding, claim of set off of additional customs duty against ultimate excise duty liability not unreasonable - Appeal allowed. (Para 3)


Taher Ali Industries And Projects (P) Ltd Vs CCE (Dated: September 29, 2015) Central Excise - Cenvat Credit - Reversal of CENVAT Credit on inputs lying in stock or used in finished goods lying in stock when exemption is availed -Exemption under Notification No.6/2002 r/w Notification No.47/2002 CE - Notificationin question did not prescribe any value-based or quantity-based exemption - Appellant, PSC Pipes manufacturer, has not availed any exemption either on value-based or quantity-based criteria for clearance in a financial year - Cenvat Credit Rules, 2002Rule 9 (2) has no applicability - More so, Cenvat credit when properly availe d, question of reversal does not arise - Reversal of credit availed on inputs, work in progress and finished goods lying in stock on date on which exemption granted, held not required - Demand for reversal of credit unsustainable - Appeal allowed. (Para 5, 6)


Gulf Oil Corporation Ltd Vs CCE & ST (Dated: January 1, 2016) CX - Assessee have taken credit on basis of invoices issued by ISD - They submitted said invoices before Tribunal in respect of demand in question - Both the authorities below had not examined this issue - Jurisdictional officer, of recipient of input/input service credit, is not competent to adjudicate ISD invoice over jurisdictional officer of ISD, who is competent to decide this matter - As there is a factual dispute, same is required to be examined by Adjudicating authority - Matter remanded: CESTAT


Finolex Cables Ltd Vs CCE (Dated: January 05, 2016) CX - Input Service - Rule 2(l) of CCR, 2004 - Outdoor catering and Rent-a-cab services - Appellant is not entitled to take credit of the service tax paid by the company which relates to recovery made from the employees for those services - Credit of Rs.54,786/- rightly denied by lower authorities - Appeal dismissed: CESTAT [para 5]


Suryaan Transmissions Ltd Vs CCE (Dated: November 16, 2015) CX - Refund - Preventive officer informing the appellant that they are liable to discharge duty under s.4A of the CEA, 1944 in respect of goods which were reworked or repacked - accordingly appellant paid duty - later, proceedings dropped by adjudicating authority and appellant sought refund - refund sanctioned but amount credited to Consumer Welfare Fund on the ground that appellant had recorded said amount as expenses in P&L account of 2006-07 - as order upheld by Commissioner (A), appellant filing appeal before CESTAT.

Held: It is very much clear that the payment of differential duty was made after clearance of their products and amount was paid at the insistence of Preventive officers - moreover, dropping of demand has not been challenged by the Revenue and if that be so, denial of refund seems to be inappropriate in view of the Bombay High Court decision in Rocket Engg. Corporation Ltd. - 2014-TIOL-364-HC-MUM-CX - order set aside and appeal allowed with consequential relief: CESTAT [para 6, 7]


CCE Vs Lupin Ltd (Dated: January 12, 2016)

CX - Valuation - Assessee engaged in manufacture of bulk drug and P&P Medicine - They were clearing physician samples meant for free distribution as part of marketing strategy - Dispute arose regarding assessable value to be adopted for these physician samples for discharging CE duty - Assessee was discharging duty in terms of Rule 11 r/w Rule 8 of Central Excise Valuation Rules, 2000 - Value was arrived at on cost construction basis i.e. 110%/115% of cost of production on basis of Board Circular No. 643/34/2002-CX. dated 01/07/2002 - As per Board Circular dated 01/7/2002, since the goods are not sold, Section 4 (1) (a) will not apply and value has to be arrived at in terms of Valuation Rules - Therefore, assessee have correctly followed valuation for impugned goods in terms of Board Circular - No justification to impose penalty on assessee: CESTAT


CCE Vs Indian Petrochemicals Corporation Ltd (Dated: January 13, 2016) CX - Demand itself was set aside in 2012 and, therefore, Revenue appeal filed in 2007 for imposition of penalty does not survive - appeal dismissed as infructuous: CESTAT [para 3]



M/s Sumetco Alloys Pvt Ltd Vs CCE (Dated: May 21, 2015) CX - Whether amount deposited during course of investigation should be considered as duty of excise - Execution of bond by assessee was not towards payment of duty on removal of excisable goods from factory - Since the amount paid during course of investigation, which is not attributable to clearance of finished product from factory, amount deposited will be construed as mere deposit and not to be considered as payment of duty - Hence, in absence of non-consideration of such deposit as payment of duty of excise, for claiming refund of such amount, provisions of section 11B will have no application - Impugned order dismissing appeal on ground of limitation is not sustainable and accordingly, same is set aside and appeal allowed: CESTAT


Precision Metals Vs CCE (Dated: January 13, 2016)

CX - CENVAT - Notification 214/86 only facilitates the principal supplier of ra w material and jobworker to avoid payment of duty at intermediate stage i.e. at jobwork stage - It is only for the convenience of the procedure that Notification 214/86 was issued and not to exempt any excise duty - Since the goods manufactured on jobwork basis is exempted on the ground that the excise duty is charged on the full value of final product wherein the value of jobwork goods deemed to have been included, the jobwork goods cannot be said to exempted goods - Rule 6(3)(b) of CCR does not have any application - No cause for recovery of an amount equal to 10% of the value of exempted job worked goods - Appeal allowed: CESTAT [para 6, 6.1]



Arbes Tools Pvt Ltd Vs CCE (Dated: January 8, 2016)

CX - CENVAT credit denied on the ground that the same was taken on the strength of a Xerox copy of Courier bill of entry and which are not prescribed documents under rule 9 of CCR - appeal to CESTAT. Held: There is no dispute that the material on which credit has been taken was imported by the appellant and used for manufacturing of the final product - in view of the case law cited of Controls & Devices Coimbatore P. Ltd. - 2008-TIOL-284-CESTAT -MAD and which is squarely applicable, appellant have correctly claimed CENVAT credit on the photocopy of courier bill of entry - credit cannot be denied on mere technical grounds - Order set aside & appeal allowed with consequential relief: CESTAT [para 5]


Universal Radiators Ltd Vs CCE (Dated: December 10, 2015) Central Excise - Additional documentary evidence -High Court in their order dated 19.12.2014 allowed the C.M.A No.2230/2008, remanding the case in entirety to the Tribunal -Miscellaneous petitions filed for admitting additional evidence relating to main appeals, contending that they are relevant for the main appeal; opposed by Revenue.

Held: All the documents which the appellant wants to include as additional evidences were submitted by the department before the Court; there are mahazars, investigation report and the deposition made before the Commissioner - the appellant

did not bring out any document or private document as new evidence - As regards Revenue's contention that Tribunal in their order dt. 29.8.2007 has already rejected the application of additional evidence, the Supreme Court has set aside the Tribunal's order and remanded the matter to Tribunal - Revenue filed appeal before the Supreme Court and against the same order, appellant also filed CMA before the High Court of Madras both on clandestine removal and also against rejection of additional evidence - the High Court has taken into consideration the Supreme Court's order in the case of Hari Chand Shri Gopal and clearly directed this Tribunal to look into all the issues afresh in the remand order - It implies that appellants agitating this aspect before the High Court on the additional grounds also needs to be considered; therefore Revenue contention is not justified. [Para 9, 10]


Periashola Tea Factory (P) Ltd Vs CCE (Dated: December 10, 2015) Central Excise - Exemption - appellants are the manufacturer of tea (chapter sub-heading No. 0902.00 of CETA, 1985) and clearing the impugned goods on payment of central excise duty, claiming exemption under Notification No. 4/99-CE dated 26.11.99, w.e.f. 10.12.1999 subject to the conditions specified therein - One of the conditions was that the assessee's factory should have worked for atleast six months during the preceding financial year - The assessee had availed the benefit of exemption from duty for the financia l year 2000-2001 after filing the undertaking in terms of the said notification; declaring therein that the "factory had been working for at least six months during the preceding year" - Verification of accounts by the department revealed that they had worked from April, 1999 to June, 1999 and four days in the month of July, 1999 and undertook trial run on 24.03.2000, shows that they have not worked for six months - Hence, SCN was issued proposing demand of duty along with interest and penalty under Section 11AC of CEA, 1944 - On adjudication, the adjudication authority dropped the proceedings proposed in the show cause notice - The Commissioner (Appeals) allowed the department's appeal and confirmed the duty demand on the clearances of tea manufactured by the appellant but dropped the penal proceedings; culminating in the instant appeal.

Held: The adjudicating authority had correctly held that the appellant factory was working throughout the year and complied with the conditions of the notification and eligible for the benefit of the notification - It is not the case of the department that the appellants not procured green leaves from small growers - The benefit of exemption is intended to promote small growers having less than 10 hectares, and the appellants used not less than two thirds of green leaves which were procured from small growers - The exemption notification should be read and interpreted in right perspective, as held by the Supreme Court in the Hari Chand Shri Gopal case - appellants are eligible for exemption under Notification No. 4/1999; accordingly, the adjudication order is upheld and the impugned order passed by the lower appellate authority is set aside. [Para 6]


Sikova Embroideries Ltd Vs CCE (Dated: January 29, 2016) CX - Quantum of deemed credit entitled was revised by amending notification 47/2003-CE(NT) but appellant availed credit as per earlier notification - credit reversed upon being pointed out - no suppression of fact or malafide can be attributed so as to invoke extended period & impose penalty - interest, however, payable - Appeal partly allowed: CESTAT [para 7, 8]



CCE Vs Vyankatesh Udyog (Dated: September 10, 2015) CX - Appellants are manufacturers of Printing Ink and ink reducer falling under Chapter Heading No. 3215 & 3814 and discharging CE duty based on value arrived at u/s 4A of CEA, 1944 and claiming abatement of 40% of the MRP on the packages - Revenue alleging that the provisions of Section 4A are applicable to only those goods for wh ich it was mandatory to print MRP under the SWAM Act, 1976 or Rules made therein or any other law for the time being in force; that as per Rule 34 of the PCR, 1977 goods specially packed for exclusive use in any industry as raw material are exempted from declaring retail sale price on packages and, therefore, goods were exempt from printing of MRP under the said Rules and duty is required to be paid in terms of s.4 of CEA, 1944 - Demand confirmed by the Additional Commissioner set aside by Commissioner(A) by relying upon the decision in Electrolux Kelvinator Ltd. - 2004-TIOL-976-CESTAT -MUM - Revenue appeal before CESTAT on the ground that the decision in Electrolux Kelvinator has been challenged in Supreme Court and the same has been admitted. Held: Decision of Tribunal in Electrolux Kelvinator Ltd. has been affirmed by the Supreme Court in Jayanti Food Processing (P) Ltd. vs. CCE, Rajasthan - 2007-TIOL-150-SC-CX - Moreover, Commissioner(A) has specifically observed that exemption from affixing MRP on package is available in terms of rule 34 of PCR, 1977 only if the the marking on the package unambiguously indicates that it has been specifically packed for the exclusive use of any industry as a raw material or for the purpose of servicing any industry, mine or quarry; that since in the SCN there is no allegation that the marking as required u/r 34 was there on the packages cleared by the appellant, the exemption from affixing MRP is not available and the goods are co rrectly assessed in terms of s.4A of the CEA, 1944 - Appeal filed by Revenue is, therefore, dismissed: CESTAT [para 7, 8]


Cosboard Industries Ltd Vs CCE, C & ST (Dated: December 11, 2015) CX - Original authority had confirmed demands in March, 2010 and appeal was disposed by Commissioner (Appeal) in September, 2010, whereas, BIFR order was passed on 07th April, 2011 - Claim of assessee is that they had complied with direction/order of BIFR - Both sides agreed that all evidences could not be examined by Commissioner (A) and need to be scrutinised afresh so as to ascertain claim of assessee that pursuant to rehabilitation scheme ordered by BIFR, same had been complied with and accordingly they are eligible to benefit of penalty and interest - Matter remanded: CESTAT


M/s Supertex Industries Ltd Vs CCE & ST (Dated: November 17, 2015) CX - Assessee had opted on 01.04.2006 to avail duty free clearance of their finished products under provisions of Notfn 30/2004-CE - They reve rsed credit on inputs lying in stock and also cleared finished goods in stock on payment of duty - Therefore, they had met with conditions of notfn on date of opting for benefit of notfn - Only lapse by them was that they had not expunged excess credit they had in their account when sub-rule (3) of Rule 11 of CCR, 2004 was introduced on a subsequent date - Assessee had committed said contravention in this respect - Any violation of sub-rule (3) of Rule 11 of Rules, 2004 should invite necessary action under Rule 14 & 15 of CCR, 2004 only and cannot be extended to extent of denying benefit of substantial notfn for that mere reason: CESTAT


Sun Pharmaceuticals Industries Ltd Vs CCE (Dated: September 25, 2015) Central Excise -100% EOU - Exemption - In E/18/2008, Appellant, a 100% EOU manufacturing Bulk Drugs, cleared goods in DTA to their own DTA unit and to others - Notice proposing denial of the benefit of Notification 23/2003 (condition No.3) related to the consumption of indigenous raw materials for manufacture of final products; alleging that valuation adopted by the appellant on the DTA clearance is to be enhanced based on the FOB value of exports - In E/325/2008, apart from the allegations in E/18/2008, notice also proposed levy of Special Additional Duty (S.A.D.) for calculating differential duty and whether S.A.D. to be considered when goods are not sold but sent to their own units on stock transfer basis and also whether higher education cess should be considered under Section 3 (1) of Central Excise Act - E/130-134/2008 are periodical in nature, identical to E/325/2008 - demands adjudicated and agitated herein.


Narasus Exports Vs CCE (Dated: November 24, 2015) Central Excise - 100% EOU - DTA Clearances - Appellant-100% EOU cleared ‘Instant Coffee Powder' to DTA without payment of duty by availing the benefit of Notification No 43/2001 CE(NT) - Revenue demanded duty by denying the benefit on the ground that the notification is not applicable to EOUs and appellant being EOU should have either exported the product or cleared to DTA on payment of duty -Notification was issued under Rule 19 and appellant's submission that Rule 19 does not exclude the clearances from 100% EOU from its purview, is acceptable - As per clause 2(ii) of the notification, benefit is allowed subject to fulfillment of the condition that provisions of the Central Excise Rules, 2001, shall be followed mutatis mutandis - Duty shall be payable only if the clearances are made to general category of buyers, however in the case, appellant has chosen to supply to special category of buyers covered under Rule 19 (2) which provides for removal of goods without payment of duty from a factory/any other premises of producer/manufacturer for use in the processing of goods which are exported as maybe approved by Commissioner -Goods were cleared under ARE-3 procedure to Blend Pack-DTA and receipt of the goods were accounted for by Blend Pack and intimation was sent to jurisdictional Commissioner of appellant's unit - Blend Pack is a job worker of Hindustan Level Ltd. (HLL) for further repacking and the goods were ultimately exported by HLL and the fact is not in dispute - Appellant cleared the goods under the Notification issued under Rule 19 which were ultimately exported by HLL - In view of the precedent, question of demanding duty on the goods ultimately exported does not arise - Impugned order of duty demand and penalty is set aside - Appeal allowed - Central Excise Rules, 2001 - Notification No. 43/2001-CE (NT) dt. 26.6.2001. (paras 5, 6, 7)



Umax Packaging Ltd Vs CCE & ST (Dated: May 26, 2015) CX - Limitation - Penalty - No iota of evidence has been brought on record by Department to prove that taking of cenvat credit by assessee is attributable to suppression, missta tement and collusion, with intent to evade payment of duty - In so far as SCN dated 16.04.2010 for period 2008-2009 is concerned, same is barred by limitation, having been issued beyond period of one year - However, in so far as credit taken for period 2009-2010, SCN has been issued within limitation period prescribed under Section 11A of CEA, 1944 - Assessee is liable to reverse cenvat credit attributable to such ineligible credit along with interest - Imposition of penalty under Rule 15(2) of CCR, 2004, r/w section 11AC of Act 1944 is not justified: CESTAT


M/s Ultratech Cement Ltd Vs CCE (Dated: December 1, 2015) CX - Assessee engaged in manufacture of Cement and Clinker liable to duty and were availing cenvat credit on input and input services - Original authority denied the credit mainly on ground that services are not used in or in relation to manufacturing activities or clearance of final products - Original authority himself elsewhere in impugned held that place of removal would include a depot and services of transportation of goods up to such depot is eligible for credit - As such a contrary view regarding these services being not connected to clearances of goods up to place of removal cannot be taken - It is found from nature of services narrated above that they have either directly or indirectly connected to manufacturing, clearance or business of assessee - Denial of credit is not legally sustainable: CESTAT


M/s South Eastern Coalfields Ltd Vs CCE & ST (Dated: January 5, 2016) CX - Dispute relates to availment of cenvat credit on disputed goods for period March, 2011 - Impugned goods have been duly used in or in relation to manufacture /production of coal, without which it would not be possible to undertake mining activities - Since disputed goods are not falling under excluded category of goods specified in definition of inputs, cenvat credit can be extended to those goods as per broad definition of "inputs" contained in Rule 2 (k) of CCR, 2004, excepting cement, which has no participation either directly or indirectly in manufacture of final product - Denial of cenvat credit for mere technical lapse of non-obtaining registration certificate at time of issuance of invoice, cannot be a defensible ground to deny cenvat credit - Cenvat credit being a beneficial piece of legislation intended for arresting cascading effect, cannot be denied to assessee, in view of fact that disputed goods have suffered duty and have received/used in assessee's factory for production of final product - They are liable to reverse Cenvat Credit taken on cement and also to pay interest for wrongly availed Cenvat Credit: CESTAT


CCE Vs Wartsila (I) Pvt Ltd (Dated: January 7, 2016) CX - D.G sets & parts supplied to Mazagon Dock for construction of warship of Indian Navy - it is nowhere mentioned in the condition to the notification that the goods have to be supplied to Indian Navy - Exemption under notf. 64/95-CE, Sr. 21, available - Reversal of credit tantamount to non-availment of credit - no cause for payment of @8% of value of exempted goods - Revenue appeal dismissed: CESTAT [para 6]



CCE Vs India Pistons Ltd (Dated: October 27, 2015) Central Excise - CENVAT credit - Revenue's grievance is that what that was actual duty leviable on the products sold by M/s. CPCL to M/s. IOCL and in turn such product sold by M/s. IOCL to the respondent is only admissible as Cenvat credit to the Respondent subject to fulfilment of other conditions of the law relating to Cenvat credit.

Held: In absence of any contrary finding as to non-payment of duty by the respondent

or for no deposit of such duty realized from respondent, into the treasury by M/s. IOCL, it would be impracticable to deny Cenvat credit to the respondent in respect of the duty paid by it on good faith to M/s. IOCL - ratio laid down by Apex Court in the case of MDS Switchgear Ltd., followed. [Para 5]


CCE Vs Hindustan Petroleum Corporation Ltd (Dated: October 27, 2015)

Central Excise - Interest - Respondent filed rebate claims on 18.10.2009, which were rejected in adjudication - Commissioner (Appeals) held the rebate admissible, in OIA dated 18.03.2011 - The rebate was granted without interest, and rejection of claim for interest adjudicated on the ground that the three month period was to be counted from 18.03.2011 - Commissioner (Appeals) granted relief by holding that the three month period counted from date of filing rebate (18.10.2009); now agitated by Revenue herein.

Held: Section 11BB of the Central Excise Act, 1944 has mandate that interest is payable on any rebate or refund claim, if such a claim is not paid within three months of the application made in that behalf - Respondent's application not being entertained within three months of the respective dates as stated above, entitlement to the interest arose under section 11BB of the Central Excise Act, 1944 - Impugned order upheld in view of the factual position and the law, as well as the Tribunal ruling in the case of Jayanta Glass Industries. [Para 5, 6]


Automotive Coaches & Components Ltd Vs CCE (Dated: October 26, 2015) Central Excise - Refund - Excess duty paid on 69 chassis directed to be refunded by Tribunal in the first round of litigation; denied in de novo adjudication; denial upheld by Commissioner (Appeals) and agitated in the second round herein.

Held: It is elementary principle of jurisprudence that the duty if any, paid excessively should not enrich the State at the cost of the citizen - Therefore, the Adjudicating authority is directed to examine whether any duty was paid in excess of the duty actually payable in respect of 69 chassis - If there is any excess payment that should not be retained with the State but should be refunded to the appellant, in terms of the guidelines laid down by the Apex Court in the case of Mafatlal Industries - Adjudicating authority following such guidelines shall order refund, if any, admissible in accordance with law, after granting fair opportunity of hearing to the appellant and examining the evidence thoroughly. [Para 6]


Yogendra Chandra Kurele Vs CC (Dated: September 18, 2015)

CX - Against adjudication order, M/s Kurele Pan Products Pvt. Ltd, filed an appeal before Tribunal and also sought waiver of compulsory pre-deposit as mandated by Section 35F of CEA, 1944 asserting that adjudication order impugned in that appeal was void since it was in transgression of judgment of Allahabad High Court - Adjudication order was set aside and matter remitted to adjudicating authority for de novo disposal of matter in light of High Court order - Assessee states that steps will be pursued before High Court for a clarification regarding observation about reconsideration by Tribunal, since adjudication order itself was quashed and matter remitted to Adjudicating authority for de novo disposal and thus, Kurele Pan Products

Pvt. Ltd's appeal before Tribunal was resultantly rendered infructuous - Appeals are dismissed as withdrawn: CESTAT

cestat ruling (central excise) · m/s dee sons silk mills pvt ltd vs cce (dated: february 12, 2016)...

Documents