Custom, Excise & Service Tax Tribunal
M/S Intas Pharmaceuticals Ltd vs Commissioner Of C.Ex. & S.Tax on 21 October, 2016
In The Customs, Excise & Service Tax Appellate Tribunal West Zonal Bench At Ahmedabad Appeal No.E/11234/2013-SM [Arising out of OIA No.21/2013(Ahd-II)CE/AK/Commr(A)/Ahd, dt.31.01.2013, passed by Commissioner (Appeals), C.Ex. & S.Tax, Ahmedabad] M/s Intas Pharmaceuticals Ltd Appellant Vs Commissioner of C.Ex. & S.Tax, Ahmedabad-II Respondent
Represented by:
For Appellant: None For Respondent: Shri A. Mishra, A.R. For approval and signature:
Honble Dr. D.M. Misra, Member (Judicial)
1. Whether Press Reporters may be allowed to see the No 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 Seen the order?
4. Whether order is to be circulated to the Departmental Yes authorities?
CORAM:
HONBLE DR. D.M. MISRA, MEMBER (JUDICIAL) Date of Hearing/Decision:21.10.2016 Order No. A/11190 / 2016, dt.21.10.2016 Per: Dr. D.M. Misra None present for the Appellants despite notice, nor any adjournment request either on the earlier date of hearing or for today filed by the Appellant. Heard the learned Authorised Representative for the Revenue.
2. This appeal is filed against OIA No.21/2013(Ahd-II)CE/AK/Commr(A)/Ahd, dt.31.01.2013, passed by Commissioner (Appeals), C.Ex. & S.Tax, Ahmedabad
3. Briefly stated the facts of the case are that the Appellant had reversed CENVAT Credit of Rs.9,79,481/- on the inputs contained in the medicines which were destroyed by them being unfit for human consumption during the period November 2011 to May 2012. Later, they filed refund claim on 28.06.2012 on the ground that said reversal of credit on their part was erroneous. A notice was issued to them on 05.09.2012, proposing rejection of the said claim. On adjudication, the refund claim was rejected. Aggrieved by the said order, they filed an appeal before the learned Commissioner (Appeals), who in turn, rejected their appeal. Hence, the present appeal.
4. The learned Authorised Representative for the Revenue submits that even though the finished products were destroyed by the Appellant, being unfit for human consumption, however, they did not apply for remission of duty. The contention of the Appellant that they have not applied for remission of duty, hence, sub-rule (5C) of Rule 3 of CENVAT Credit Rules 2004 is not applicable, cannot be acceptable.
5. I find that undisputedly the Appellant had destroyed the finished goods viz. pharmaceutical products being unfit for human consumption. The learned Commissioner(appeals), after detailed analysis of the facts, observed that the input credit cannot be refunded to the Appellant. The findings of the learned Commissioner (Appeals) are as follows:-
6. I find that the first contention of the Assessee is that the expired medicines are classifiable under chapter sub heading 30069200 as waste pharmaceuticals therefore, they can remove the same without getting remission permission and the question of reversal of CENVAT Credit does not arise and hence Notification No.33/2007-CE(NT), dt.07.09.2007 is not applicable to their case. I find that the provisions of Rule 21 of the Central Excise Rules 2002 is attracted in the present case as the Appellant by their own admission has destroyed the waste pharmaceutical, same being expired medicine unfit for consumption of human being and therefore, the Appellant were required to have applied for the remission permission from the jurisdictional Central Excise authorities. Therefore, as per the remission permission granted by the jurisdictional authorities, the Appellant should have remitted the duty payable on such goods. Therefore, I find that by not applying for remission of duty the Appellant has contravened the provisions of Rule 21 of Central Excise Rules 2002.
7. The next contention of the Appellant is that the Notification No.33/2007-CE(NT), dt.07.09.2007 is not applicable to waste pharmaceuticals and therefore, the question of reversal of CENVAT Credit does not arise. Vide the said notification, Rule 3 of CENVAT Credit Rules 2004 has been amended by inserting sub-rule 5C, which clearly and specifically states that where on any goods manufactured or produced by an Assessee, the payment of duty is ordered to be remitted under Rule 21 of Central Excise Rules 2002, the CENVAT Credit taken on the inputs used in the manufacture or production of the goods shall be reversed. Thus, from the wordings of the notification, it is evident that CENVAT Credit taken on the inputs used in the manufacture or production of any goods is required to be reversed if the payment of duty is ordered to be remitted under Rule 21 of Central Excise Rules 2002. I also find that the Board, vide circular No.800/33/2004-CX, dt.01.01.2004 has clarified that the credit of Excise duty paid on the inputs used in the manufacture of finished goods, on which duty has been remitted due to damage or destruction etc., is not permissible and dues with interest should be recovered. I find that reversal of CENVAT Credit on inputs contained in the waste pharmaceuticals destroyed are governed by the provisions of Rule 21 of Central Excise Rules 2002 read with sub-rule 5C of Rule 3 of CENVAT Credit Rules 2004 (inserted vide No.33/2007-CE(NT), dt.07.09.2007). Therefore, I find that the CENVAT Credit was rightly reversed by the Appellant and the refund claim filed by them is rightly rejected by the Adjudicating Authority.
6. I do not find any reason to disagree with the aforesaid reasoning of the learned Commissioner (Appeals). In the result, the impugned order is upheld and the appeal is dismissed.
(Dictated and pronounced in the open court) (Dr. D.M. Misra) Member (Judicial) Cbb 4