Custom, Excise & Service Tax Tribunal
M/S. Max India Ltd vs Cce & St, Chandigarh-Ii on 10 September, 2015
CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL,
WEST BLOCK NO.2, R.K. PURAM, NEW DELHI-110066
BENCH-SM
COURT IV
Excise Appeal No.E/51451/2014 EX. [SM]
[Arising out of Order-in-Appeal No.JAL-EXCUS-000-APP-267-13-14 dated 06.01.2014 passed by the Commissioner Central Excise (Appeals), Chandigarh-II]
For approval and signature:
HONBLE MR. S.K. MOHANTY, MEMBER (JUDICIAL)
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. Max India Ltd. Appellant
Vs.
CCE & ST, Chandigarh-II Respondent
Present for the Appellant : Shri V. Swaminathan, Advocate
Present for the Respondent: Shri.G.R. Singh, DR
Coram: HONBLE MR. S.K. MOHANTY, MEMBER (JUDICIAL)
Date of Hearing/Decision: 10.09.2015
FINAL ORDER NO. 54066/2015
PER: S.K. MOHANTY
This appeal is directed against the impugned order dated 8th January, 2014 passed by the Commissioner (Appeals), Central Excise, Chandigarh, wherein cenvat credit taken by the appellant on renting of immovable property disallowed confirmed in the adjudication order, has been upheld.
2. The brief facts of the case are that the appellant is engaged in the manufacture of BOPP Film and Leather Finishing Foil Transfer falling under Heading 3920 and 3912 respectively of the Central Excise Tariff Act, 1985. The appellant had paid service tax on rent for its corporate /head office at Delhi. The Service Tax attributable to the rental amount was taken as cenvat credit by the appellant. Taking of cenvat credit was disputed by the Central Excise Department through initiation of show cause proceedings. In the show cause notice, it was alleged that the input service on which cenvat credit has been taken has no nexus with the manufacture of the finished goods. The show cause notice was adjudicated vide order dated 27th February, 2013, wherein the allegations made therein have been confirmed. Besides, the adjudicating authority took the view that since, the agreement with the landlord has been executed by Max Speciality Products Limited, which is not registered with Central Excise Department, taking of cenvat credit by the appellant is not in conformity with the cenvat statute. In appeal, the Commissioner (Appeals) has negated the views taken by the adjudicating authority with regard to the nexus aspect. However, the Commissioner (Appeals) has upheld the order of the adjudicating authority with regard to the fact that the appellant is not the person who has taken the premises on rent.
3. Feeling aggrieved with the impugned order, the appellant is before this Tribunal.
4. Shri V.Swaminathan, the ld. Advocate appearing for the appellant submits that since there is no specific allegation in the show cause notice that the appellant has not taken the premises on rent. The show cause notice has been issued for denial of cenvat benefit on the sole ground that there was no nexus between the input service and the goods manufactured by the appellant. Both the authorities below denied credit on the ground, which was not canvassed in the show cause notice. He further submits since the allegation levelled in the show cause notice with regard to the nexus between the input service and the finished goods manufactured by the appellant has been decided by the Commissioner (Appeals) in favour of the appellant, which has not been contested by the Department in further appeal, the issue in dispute has attained finality and as such denial of cenvat benefit on the ground not mentioned in the show cause notice is contrary to the provisions of law.
5. Per contra, Shri. G.R. Singh, the ld. D.R. appearing for the Revenue, reiterates the findings recorded in the impugned order.
6. I have heard the ld. Counsel for both sides and perused the records.
7. I find that the show cause notice has been issued seeking denial of cenvat benefit on the sole ground that there is no nexus between the input service and the finished goods manufactured by the appellant. Since the said allegation levelled in the show cause notice was dropped by the Commissioner (Appeals) by holding that there is nexus between the input service and the finished goods manufacture by the appellant, the demand cannot be sustained. Since the demand has been confirmed by the lower authorities on a ground which is beyond the show cause notice, the demand cannot be fastened against the appellant. Therefore, the impugned order is set aside. The appeal is allowed in favour of the appellant.
(Dictated and pronounced in the open Court) (S.K. MOHANTY) MEMBER (JUDICIAL) Anita ??
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