Custom, Excise & Service Tax Tribunal
Glaxosmithkline Consumer Health Care ... vs Commissioner Of Central ... on 17 January, 2014
CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL SOUTH ZONAL BENCH BANGALORE Final Order No. 20050 / 2014 Application(s) Involved: E/Stay/27149/2013 in E/26816/2013-SM Appeal(s) Involved: E/26816/2013-SM [Arising out of Order in Original 07-2013 dated 06/02/2013 passed by Commissioner of Central Excise , VISAKHAPATNAM-II Glaxosmithkline Consumer Health Care Ltd Dowlaiswaram RAJAMUNDRY AP Appellant(s) Versus Commissioner of Central Excise,Service Tax and Customs - VISAKHAPATNAM-II CENTRAL EXCISE BUILDING, PORT AREA, VISAKHAPATNAM, ANDHRA PRADESH 530035 Respondent(s)
Appearance:
Shri B. Raghavendra, Advocate LAKSHMI KUMARAN & SRIDHARAN WORLD TRADE CENTRE NO.404-406, 4TH FLOOR, SOUTH WING BRIGADE GATEWAY CAMPUS NO.26/1, DR. RAJKUMAR ROAD, BANGALORE KARNATAKA 560 055 For the Appellant Shri A.K. Nigam, Addl. Commissioner(AR) For the Respondent CORAM:
HON'BLE SHRI B.S.V.MURTHY, TECHNICAL MEMBER Date of Hearing: 17/01/2014 Date of Decision: 17/01/2014 Order Per : B.S.V.MURTHY Appellant is engaged in the manufacture of various varieties of bulk horlicks and bulk boost. During the course of manufacture of these products, ghee emerges as byproduct. The entire production of Horlicks and Boost are cleared on payment of duty and ghee is cleared without payment of duty. The appellant was availing CENVAT credit of service tax paid on telephone services, courier and consultancy services which were common to all the products. Taking a view that appellant should have maintained separate accounts in respect of dutiable products and exempted products, proceedings were initiated for demanding the amount payable as per Rule 6(3) of the CENVAT Credit Rules, 2004 on the ground that appellant has failed to maintain separate accounts. The demand for the entire period from April 2005 to September 2008 covered by two show-cause notices was confirmed against the appellant and the matter travelled up to this Tribunal. This Tribunal, after considering the submissions, remanded the matter to the learned Commissioner taking note of the fact that the appellant had already made an application to the Commissioner to regularize the proportionate credit reversed by them during the period in question. This request was made to the Commissioner as per the provisions under Section 73(2) of Finance Act 2010 wherein provisions relating to CENVAT credit for the period prior to 01/04/2008 were given retrospective effect and assessee was allowed to file applications before the Commissioner and make proportionate reversal of CENVAT credit availed by them with interest.
2. The Commissioner has adjudicated the matter afresh as per the directions in the remand order and the amounts paid by the appellant up to 31/03/2008 have been considered and applications allowed and matter has been settled to the satisfaction of both sides. The grievance of the appellant is only with regard to demand of the amount payable under Rule 6(3) for the period subsequent to 01/04/2008 which the learned Commissioner has held that this was beyond the scope of remand.
3. The learned counsel submits that the appellant has been following the procedure of availing proportionate credit attributable to dutiable products at the time of clearance only and therefore question of reversal would not arise. He also submits that in accordance with provisions of CENVAT Credit Rules, 2004 as amended from 01/04/2008, the appellant was following the procedure prescribed under the rule and he draws my attention to the letter dt. 29/06/2009 submitted by the appellant giving the details of total credit availed, reversed and the basis for the same to the Superintendent of Central Excise as contemplated under Rule 6(3A) of the CCR. He also submits that appellant has produced Chartered Accountants certificate also. He also submits that the appellant need not have reversed even proportionate credit in view of the decision of the Honble High Court of Bombay in the case of Rallies India Ltd. Vs. UOI [2009(233) ELT 301 (Bom.)]. However, this argument is not pressed in view of the fact that appellant had already exercised option and had reversed the proportionate credit.
4. On going through the show-cause notice and perusal of the records and considering the submissions made by the learned counsel, I find that in the show-cause notice itself in the statement recorded from Shri Ashok Vasisht, Manager, Finance, it emerges that appellant was taking proportionate net credit based on their own formula in respect of dutiable products. This process was being followed by them throughout. The only problem was that prior to 01/04/2008, there was no provision for reversal of proportionate credit and hence the appellant has got the same regularized by filing application before the Commissioner in view of the Finance Act. For the subsequent period, it is quite clear that the appellant had followed the procedure contemplated under Rule 6(3A) of CCR and they have also submitted a correlation statement, as required, on 29/06/2009 to the Superintendent. The only reason for non-consideration of these aspects for the period from 01/04/2008 to September 2008 is the fact that in the remand order passed by the Tribunal there was no specific direction. The discussion above would show that appellant is not at all liable to pay any additional duty or additional amount in view of the fact that they have followed the statutory provisions which were required to be followed. Therefore the appellants have made out a case in their favour. In fact appellant has made out a complete case in their favour and there is nothing left to decide at the final stage. In this view of the matter, the requirement of pre-deposit is waived and the appeal itself is allowed with consequential relief if any to the appellant.
(Order dictated and pronounced in open court) B.S.V.MURTHY TECHNICAL MEMBER Raja..
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