Custom, Excise & Service Tax Tribunal
Wipro Ltd vs Commissioner Of Central Excise on 17 March, 2016
IN THE CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL,WEST ZONAL BENCH AT MUMBAI COURT No. II APPEAL No.E/451/12 (Arising out of Order-in-Appeal No.AKP/NSK/212/2011 dated 26/12/2011 passed by Commissioner of Central Excise & Customs (Appeals), Nashik) For approval and signature: Honble Mr. Raju, 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 :Yes 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? ========================================
Wipro Ltd., Appellant
Vs.
Commissioner of Central Excise, Respondent
Nashik
Appearance:
Ms.Aparna H, Advocate for appellant
Shri.VK Shashi, Asst. Comm. (AR) for respondent
CORAM:
Honble Mr. Raju, Member (Technical)
Date of Hearing : 17/03/2016
Date of Decision : /03/2016
ORDER NO
Per: Raju
1. The appellant, M/s.Wipro Ltd. imported 160 MTs of Lauric Acid in October 2007 and received a total quantity of 112 MTs out of 160 MTs and balance quantity of 48 MTs was transferred to their Baddi unit. The appellant availed the entire credit of the materials imported including the credit in respect of the material which was sent to Baddi unit. During audit in 2009 it was detected that the appellant had taken credit of the entire quantity while a part of the quantity was transferred to their Baddi unit. On pointing out, the appellant reversed the credit after about a year and a half. They have also paid interest thereon. A show-cause notice was issued in October 2010 seeking to confirm the reversal already made and the interest already paid by them. The notice also sought to impose penalty under Rule 15 (2) of the Cenvat Credit Rules, 2004 read with Section 11AC of the Central Excise Act, 1944. The original adjudicating authority as well as the first appellate authority confirmed the reversal and also the payment of interest. They also confirmed the imposition of penalty. Aggrieved by the said order, the appellant are before this Tribunal.
2. The learned Counsel for the appellant argued that Section 11A (2B) of the Central Excise Act, reads as follows:
Where any duty or excise has not been levied or paid or has been short-levied or short-paid or erroneously refunded, the person, chargeable with the duty, may pay the amount of duty71 [on the basis of his own ascertainment of such duty or on the basis of duty ascertained by a Central Excise Officer] before service of notice on him under sub-section (1) in respect of the duty, and inform the Central Excise Officer of such payment in writing, who, on receipt of such information shall not serve any notice under sub-section (1) in respect of the duty so paid: Provided that the Central Excise Officer may determine the amount of short payment of duty, if any, which in his opinion has not been paid by such person and then, the Central Excise Officer shall proceed to recover such amount in the manner specified in this section, and the period of one year referred to in sub- section (1) shall be counted from the date of receipt of such information of payment. Explanation 1. Nothing contained in this sub-section shall apply in a case where the duty was not levied or was not paid or was short-levied or was short-paid or was erroneously refunded by reason of fraud, collusion or any wilful mis-statement or suppression of facts, or contravention of any of the provisions of this Act or of the rules made thereunder with intent to evade payment of duty. Explanation 2. For the removal of doubts, it is hereby declared that the interest under section 11AB shall be payable on the amount paid by the person under this sub-section and also on the amount of short-payment of duty, if any, as may be determined by the Central Excise Officer, but for this sub-section.] 72 [ Explanation 3 .For the removal of doubts, it is hereby declared that no penalty under any of the provisions of this Act or the rules made thereunder shall be imposed in respect of payment of duty under this sub-section and interest thereon.
3. According to learned Counsel for the appellant, since they had reversed the credit and also paid the interest when the same was pointed out by the Revenue they are covered by the said sub section (2B) of the Section 11A. She also argued that merely alleging suppression is not enough and the Revenue is required to prove the same.
4. The learned AR argues that the second unit which the material was transferred is located in Baddi and does not benefit from the credit of duty paid of the raw materials. He further argued that the law in this regard is very apparent and there is no scope of mis-interpretation of law. He argued that if the revenue had not detected this, the appellant would have got away with the excess credit.
5. I have gone through the rival submissions. I find that the Cenvat Credit Rules are very unambiguous and clear. There is not an iota of doubt about the manner in which the credit is required to be taken in such cases and the amount of credit are required to be taken when the same goods are received. The appellants contention that it was an inadvertent error does not appear to logic as there is no ambiguity in law, so far as the availment of credit in these circumstances are concerned. This is also apparent from the fact that the moment it was pointed out the appellant was paid the same and not contested on merit. It is seen that the appellants are very well conversant with the process as in para 2 of their appeal is stated as follows:
3. In the normal course of business, the inputs used by the appellants in its manufacturing operations are either imported or procured indigenously. In respect of imported inputs, the appellants import MOQ or container loads from the sellers located outside India and upon import the inputs are then sent to other units of the Appellants based on specific production requirements. In case of such inputs being sent to other units, the appellants reverse proportionate credit availed in respect of such inputs.
6. Every time the inputs are cleared as such, the appellant is required to make invoice and the invoice contains the column where the duty reversed is to be mentioned. It is not something which can slip out of mind inadvertently. In this era of self assessment great trust has been placed on the assessee to do self assessment diligently and properly. In the instant case, it is apparent that the other unit to which the material was transferred could not have benefited by taking the credit of the said duty. In these circumstances, the intention to evade duty is apparent. Section 11A (2B) not applicable to the cases where the duty was short paid for reasons of fraud, collusion or any mis-statement or suppression of facts, as is apparent in this case. The appeal is therefore dismissed.
(Pronounced in Court on ..) (Raju) Member (Technical) pj 1 2