Custom, Excise & Service Tax Tribunal
Cable Corporation Of India Ltd vs Commissioner Of Central Excise, ... on 21 October, 2016
IN THE CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL, WEST ZONAL BENCH AT MUMBAI COURT NO. II Appeal No. E/786/11-Mum [Arising out of Order-in-Appeal No. SB(11)11/MV/2011 dated 09.02.2011 passed by Commissioner of Central Excise (Appeals), Mumbai Zone-I] For approval and signature: Honble Mr. Devender Singh, Member (Technical) =======================================================
1. Whether Press Reporters may be allowed to see : No
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 : seen
of the Order?
4. Whether Order is to be circulated to the Departmental: Yes
authorities?
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Cable Corporation of India Ltd.
:
Appellant
VS
Commissioner of Central Excise, Mumbai-V
:
Respondent
Appearance:
Ms. Aparna H., Advocate for the Appellant
Shri Ashutosh Nath, A.C. (A.R.) for the Respondent
CORAM:
Honble Mr. Devender Singh, Member (Technical)
Date of hearing: 23/06/2016
Date of decision: 21/10/2016
ORDER NO.
Per : Devender Singh
The Appellants have filed this appeal against the order of Commissioner of Central Excise (Appeals), Mumbai Zone-I.
2. Brief facts of the case are that during an audit of the appellants by Central Excise authorities in October, 2009, it was noticed that they have availed cenvat credit of the specified duties on the basis of customs duty paid challans in respect of warehoused ex-bonded imported goods on 30.11.2007 and 29.12.2007. The department issued a show cause notice demanding the duty of Rs.22,91,820/- alongwith interest and proposed penalty for suppression on the ground that the credit had been availed on the challans and not on the bills of entry. The matter was adjudicated and the above demand alongwith interest was confirmed and equivalent amount of penalty was imposed. The party went in appeal and Commissioner (Appeals) has rejected their appeal and upheld the order of adjudicating authority. Against the said order of Commissioner (Appeals), the appellants are before this Tribunal.
3. Ld. Advocate for the appellants submits that the goods, against all the bill of entries, were imported in their own name and were warehoused. Due to expiry of period of warehousing in June 2007, they could not file ex-bond bills of entries for clearance of their goods from the warehouse. The same were cleared by them on payment of duty in November 2007. She invited attention to various duty paying challans in the paper book on which the customs authority has accepted the duty and particulars of the respective bill of entry, description of goods, vessel name, bond no. and date etc. had been mentioned. She further stated that the proper entries in RG-23 Part-II register as well as on the face of duty paid challans had been made. Further, there is no allegation that duty paid goods have not been received in their factory. She stated that the customs duty as well as CVD have been paid, which was duly accepted by the customs authorities and the goods after clearance have been used in manufacture of final product. She also argued on limitation pleading that proper declarations were made in ER-1 and proper entries maintained in RG-23 Part-II register. Hence, the department could not allege suppression and the show cause notice dated 24.03.2010 for the period November December, 2007, was barred by limitation. She relied upon the following case laws:-
(i) CCE, Chandigarh vs. Stelko Strips Ltd.
-2010 (255) ELT 397 (P&H)
(ii) CCE, Chennai vs. Ennore Foundries
-2009 (244) ELT 288 (Tri.- Chennai)
(iii) Philips India Ltd. vs. CCE, Varodara
-2005 (191) ELT 1028 (Tri.- Mumbai)
(iv) CCE & Cus., Varodara-II vs. Steelco Gujarat Ltd.
-2010 (255) ELT 518 (Guj.)
(v) Gabriel India Ltd. vs. Collector of Cen. Ex.
-1993 (67) ELT 131 (Tribunal)
(vi) Rishabh Industries Pvt. Ltd. vs. C.C.E., Mumbai-VII
-2001 (132) ELT 299 (Tri.-Mumbai)
(vii) C.C.E. & Cus., Vadadara-II vs. Eupec-Welspun Pipe Coatings India Ltd.
-2010 (260) ELT 381 (Guj.)
(viii) CCE, Ludhiana vs. Ralson India Ltd.
-2006 (202) ELT 759 (P&H)
4. Ld. AR appearing on behalf of the Revenue, submitted that Rule 9 of CCR, 2004 allows cenvat credit on the basis of a bill of entry and there was no scope to allow the credit to be taken on the basis of duty payment challans. In support of his contention, he relied upon the following case laws:
(i) Union of India vs. Marmagoa Steel Ltd.
- 2008-TIOL-249-SC-CX
(ii) Sheela Dying & Printing Mills P. Ltd. vs. C.C.E. & C., Surat-I
- 2008-TIOL-707-HC-AHM-CX
(iii) Godrej Consumer Products Ltd. vs. CCE, Indore
- 2010-TIOL-1739-CESTAT-DEL
(iv) S.S. Organics Limited vs. C.C.E, Hyderabad
- 2015 (322) ELT 124 (A.P.)
5. Heard both the parties and perused the records.
6. I find that the show cause notice has been issued on the sole ground that the appellants had availed cenvat credit on the basis of customs duty paid challans and thereby contravened Rule 9 and Rule 3 of CCR, 2004. It is not disputed that the inputs, on which credit has been taken, were imported by the appellants who filed the bill of entry for their warehousing. Due to problems with warehousing period, they could not file the ex-bond bill of entry and cleared the goods on payment of custom duty which was duly accepted by customs authorities. The duty payment challans have been signed by the customs officer for Assistant Commissioner of Customs (Bond Department), Nhava Sheva Custom House. Duty payment challans contain material particulars like bill of entry no., description of goods, bond no., assessable value, duty and interest amount. There is no allegation in the show cause notice that the goods were diverted or were not received in the factory. The goods have been cleared after payment of appropriate duty and proper entries have been made in the RG-23 Part-II register and duty paying challans correlate with the respective entry in RG-23 Part-II register. There is no allegation that the duty paying challans are fake or that the cenvat credit has been taken again on the basis of these challans. In the judgment of Honble Punjab & Haryana High Court in the case of Stelko Strips Ltd. (supra), it has been held as under:
3. This Court in Commr. Of Cen.Ex, Panchkula vs M/s. Auto Spark Industries, Panchkula, CEC No. 34 of 2004, decided on 11-7-2006, while relying on the issues in Commr. Of Cen. Ex., Ahmedabad-I vs. Gujarat Medicraft Pvt Ltd and the Departments Circular dated 19.11.2001, has held that one duty payment is not disputed and it is found that documents are genuine and not fraudulent, then the manufacturer would be entitled to Madvat Credit on duty paid inputs.
4. Similar view was taken in Commr. Of Cen.Ex., Ludhiana vs. Ralson India Ltd. reported as 2006 (202) E.L.T. 759 (P & H), wherein a Division Bench of this Court held that if the duty paid character of inputs and their receipt in manufacturers factory and utilization for manufacturing a final product is not disputed, then credit cannot be denied. A similar view was also taken in Commr. Of C.Ex., Delhi-III,Gurgaon vs. Myron Electricals Pvt Ltd, reported as 2007 ELT 664 (P & H) = 2008 (11) STR 85 (P & H).
5. In view of the above, the respondent-manufacturer would be entitled to claim Madvat credit on the strength of private challans, as the same were not found to be fake and there was a proper certification that duty had been paid.
7. It is also seen that this Tribunal in the case of CCE, Vapi vs. Mehta Hwa Fuh Plastics Pvt Ltd. 2012 (285) ELT 253 (Tri.-Ahmd.), has held that when the receipt of the inputs and its final use in manufacturing is not disputed then the inputs cannot be denied the cenvat credit. Para 6 of this judgment is extracted below:-
6. Before I proceed further, it would be appropriate to consider the decisions relied upon by the ld. AR in his submissions. In the case of Marmagoa Steel Ltd, Honble Supreme Court held that credit is not admissible since in that case the bill of entry was in the name of M/s Essar Gujarat Ltd and the Honble Court allowed the credit where original copies of duplicate bills of entry were produced which had been endorsed in favour of the respondents therein and in respect of one bill of entry, the triplicate copy of bill of entry was not available and the respondent had produced a certificate from the superintendent of Central Excise, in-charge of the Range in whose jurisdiction M/s Essar Gujarat Ltd was situated. Needless to say this cannot be compared with a situation where the verification is taken up after four and a half years of the event and the assessee claims misplacement of original documents but submits all supporting documents which clearly show that the goods has been received. Further, it has to be noted that bills of entry were in the name of the respondent only and a certificate from Deputy Commissioner, Customs, has been produced. As regards the decision in the case of S.K. Foils Ltd, credit was proposed to be availed on the basis of carbon copy of the challan and respondent had made a statement that original challans were not being issued by the supplier which was found contrary to the facts. Therefore, this decision is also not applicable. As regards the decision in M/s Survoday Bending Pvt Ltd, the bill of entry was dated 10.2.2005 whereas the credit was taken on 14-4-2006. In that case the Tribunal took the view that if the copy of the original bill of entry was available with them at the time when credit was taken and there was no explanation why it was misplaced subsequently. The original bill of entry in that case was available in 2005 till 14-4-2006 for more than a year and thereafter it got misplaced. These peculiar facts were taken note of to disallow the credit. In this case Commissioner has not simply allowed the credit but has relied upon the decision of the Tribunal in the case of Steelco Gujarat Ltd. 2009 (242) ELT 229 (Tri-Ahmd) and distinguished the decision of the Larger bench in the case of Avis Electronics P Ltd. 2000 (117) ELT 571 (LB). Further, he has also relied upon the decision of Honble High Court of Bombay in the case of Marmagoa Steel Ltd. (supra), simplex Mills Co. Ltd. 2007 (81) RLT 331 (Bom). Wherein it was held that credit is admissible on the basis of endorsed copies of invoice if inputs have been received and used. He has also relied upon the decision of Honble High Court of Madhya Pradesh in the case of Kataria Wires Ltd. 2009 (241) ELT 31 (MP) wherein it was held that the credit is admissible on the basis of certified copy of invoices. In view of the detailed order passed by the Ld. Commissioner which has taken note of several decisions while coming to the conclusion and which has also come to the conclusion that goods have been received and used in the manufacture and duty has been paid, I find that there is nothing legally or factually wrong with the impugned order.
Accordingly, appeal filed by the Revenue has no merits and is rejected. Similar view has been taken in the case of Umedica Laboratories Pvt Ltd. vs. CCE, Vapi 2015 (327) ELT 192 (Tri.-Ahmd.).
8. The judgments mentioned in para 6 and 7 are directly applicable to the facts of this case.
9. In view of the above, it is held that the cenvat credit has been correctly availed by the appellants and the appeal filed by the appellants is allowed.
(Order pronounced in court on 21.10.2016) Devender Singh Member (Technical) RAS 8 E/786/11-Mum