Custom, Excise & Service Tax Tribunal
) Ccs Infotech Ltd vs ) Cce Pondicherry on 19 February, 2009
IN THE CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL
SOUTH ZONAL BENCH AT CHENNAI
Appeal No. E/181/07 (by assessee)
E/237/07 (by dept.)
[Arising out of Order-in-Appeal No.110/2006 (P) dated 26.12.2006 passed by the Commissioner of Central Excise (Appeals), Chennai]
For approval and signature:
Honble Mr.P.KARTHIKEYAN, 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 the Member wishes to see the fair copy of
the Order? :
4. Whether Order is to be circulated to the Departmental
Authorities? :
1) CCS Infotech Ltd.
2) CCE Pondicherry
Appellants
Versus
1) CCE Pondicherry
2) CCS Infotech Ltd.
Respondent
Appearance:
Shri M.Karthikeyan, Consultant Shri V.V.Hariharan, JCDR For the Appellants For the Respondent CORAM:
Honble Mr.P.Karthikeyan, Member (Technical) Date of hearing : 19.2.2009 Date of decision : 19.2.2009 Final Order No.____________ The appellants M/s.CCS Infotech Ltd., Pondicherry are engaged in the manufacture of computers falling under Chapter 8471 of the Central Excise Tariff. They availed the CENVAT credit facility till 9.7.2004 when computers were exempted from payment of duty vide Notification No.23/2004-CE. The appellants had a stock of inputs as such, inputs in various stages of production of computers and finished goods. The original authority demanded CENVAT credit relatable to inputs in stock as well as inputs contained in the work in progress and the finished goods as on 9.7.04. This demand was raised in terms of Rule 12 of CENVAT Credit Rules, 2002/Rule 14 of CENVAT Credit Rules, 2004. A total amount of Rs.4,49,702/- was demanded. He also imposed a penalty of Rs.1,50,000/- under Rule 13 of CCR 2002/15 of CCR 2004. The impugned order upheld the demand of duty but vacated the penalty imposed.
2) When the case is called, both sides submit that the dispute as to whether credit relatable to stock of inputs, inputs contained in work in progress and the finished goods when the finished goods are exempted has since been resolved by a Larger Bench of this Tribunal in favour of the assessees. It is submitted that in the case of H.M.T Vs CCE Panchkula, 2008 (232) E.L.T. 217 (Tri.-LB), dealing with a similar case, the Tribunal held that the input-credit legally taken and utilized on the dutiable final products need not be reversed on the final product becoming exempt subsequently w.e.f. 9.7.04. Following the ratio of this decision of the Tribunal, it is held that the impugned demand is not sustainable. The appeal of the assessee is allowed.
3) In the appeal filed by the Revenue, the prayer is to restore the penalty vacated by the Commissioner (Appeals). As the demand itself is vacated as not sustainable, there is no question of restoring the penalty vacated by the lower appellate authority. The appeal file by the Revenue is dismissed.
(Dictated and pronounced in open court) (P.KARTHIKEYAN) MEMBER (T) gs 2