Custom, Excise & Service Tax Tribunal
M/S.Air Liquid North India Pvt.Ltd vs Cce, Jaipur on 16 June, 2011
CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL,
WEST BLOCK NO.II, R.K. PURAM, NEW DELHI-110066.
SINGLE MEMBER BENCH
Court No.III
Excise Appeal No.E/1168/09-SM
(Arsing out of Order-in-Appeal No.09(DK)CE/JPR-II/2009 dated 22.1.2009 passed by the CCE (A), Jaipur)
For approval and signature:
Honble Mr.M.Veeraiyan, Member (Technical)
1
Whether Press Reporters may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?
2
Whether it should be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?
3
Whether Their Lordships wish to see the fair copy of the Order?
4
Whether Order is to be circulated to the Departmental authorities?
M/s.Air Liquid North India Pvt.Ltd. Appellants
Vs.
CCE, Jaipur Respondent
Present for the Appellant: Ms.Sukriti Das, Advocate
Present for the Respondent: Shri R.K.Gupta, SDR
Coram: Honble Mr. M.Veeraiyan, Member (Technical)
Date of Hearing: 16.06.2011
Date of Decision: 16.06.2011
ORDER NO._______________
PER: M.VEERAIYAN
This is an appeal against the order of the Commissioner (Appeals) No.09(DK)CE/JPR-II/2009 dated 22.1.2009.
2. Heard both sides.
3. The appellants received transformers in the year 2004 and availed cenvat credit of Rs.60,726/- as applicable to capital goods. They used the transformers for more than ten years and sold the same in May,2005 for a sum of Rs.1,80,356/- and paid excise duty amounting to Rs.29,464/- on the transaction value. The department, in pursuance of the audit objection confirmed the demand of differential duty of Rs.31,262/- holding that the transformers received by them in 2004 and utilized for more than ten years and sold should be treated as and cleared as such. The original authority confirmed the demand of Rs.31.262/- and imposed equal amount as penalty. The Commissioner (Appeals) upheld the order of the original authority.
4. Learned Advocate submits that it is not the case of clearance of transformer as such. It was sold only as scrap and high value is attributable to metal contents in the old and used transformers. She also relies on the decision of the Tribunal in the case of Trinity Auto Components Ltd. vs. CCE, Pune-III reported in 2010 (257) ELT 548 and decison in the case of Cummins India Ltd. vs. CCE, 2007 (219) ELT 911.
5. Learned SDR reiterating the findings and reasoning of the Commissioner (Appeals), submits that the duty payable on goods cleared as such should be equal to the credit originally taken. In this regards, he relies on the decision of the Larger Bench of the Tribunal in the case of Modernova Plastyles Pvt.Ltd. vs. CCE, Raigad reported in 2008 (232) ELT 29.
6. I have carefully considered the submissions and perused the records. The show cause notice alleges that the transformer has been cleared as such. It is not disputed that the transformer has been utilized for more than ten years. The claim on behalf of the appellants is that they were only sold as scrap after using the same for more than ten years. The clearance of such old and used transformer though described in the invoice as transformer cannot be treated cleared as such unless it was shown that the buyer has used it as transformer and not as scrap. No investigation in this regard has been done by the department. In the absence of evidence, the allegation that the transformer has been cleared as such for further use by the buyer also as transformer cannot be accepted. Interpretation sought to be placed by the department in effect, would lead to a situation no credit is allowed in spite of the fact the capital goods were undisputedly used for more than ten years for the intended purpose. Therefore, it should be treated as clearance of transformer as scrap as claimed by the appellants and the appellants have undisputedly paid duty on the transaction value. The decision of the Larger Bench of the Tribunal in the case of Modernova Plastyles Pvt.Ltd. is on the facts that whatever end use of the product cleared as such was the same as that of the original product.
7. In the present case, no such evidence has been relied upon, and therefore, the order of the Commissioner (Appeals) is set aside and the appeal is allowed with consequential relief as per law.
(Pronounced in the open court) (M.VEERAIYAN) MEMEBR (TECHNICAL) mk 1 4