Custom, Excise & Service Tax Tribunal
4. Whether Order Is To Be Circulated To ... vs M/S Jindal Texofab Ltd on 19 November, 2010
IN THE CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL
WEST ZONAL BENCH AT AHMEDABAD
COURT:
II
Appeal No.E/1355/2006
Arising out of: OIO No. 3/Commr/2006, dt.31.01.2006
Passed by: Commissioner of Central Excise & Customs, Ahmedabad
For approval and signature:
Honble Mrs. Archana Wadhwa, Member (Judicial)
Honble Mr. B.S.V. Murthy, Member (Technical)
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 No
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?
Appellant:
M/s Jindal Texofab Ltd.
Respondent:
CCE Ahmedabad Represented by:
Shri H.D.Dave, Adv. for the Assessee; Shri J.S. Negi, SDR for the Revenue.
CORAM:
MRS. ARCHANA WADHWA, MEMBER (JUDICIAL) MR. B.S.V. MURTHY, MEMBER (TECHNICAL) Date of Hearing/Decision:19.11.10 ORDER No. /WZB/AHD/2010 Per: Mrs. Archana Wadhwa:
After hearing both sides, we find that the appellants are engaged in manufacture of cotton fabrics and man made fabrics. In the year 2003, several changes in the textile sectors were made by bringing the manufacturers of grey fabrics into Central Excise net. Rule 9A was added in the CENVAT Credit Rules, 2002 vide Notification No.25/2003-CE(NT), dt.25.3.03, providing Transitional Cenvat Credit to the manufacturers of fabrics in respect of input lying in stock as on 31.3.03. In terms of above provisions, the appellants filed declaration on 7.4.03 declaring the stock of input/semi-finished/finished goods lying as on 31.3.03.
2. Subsequently, Sub-rule 5 was inserted in Rule 9A CENVAT Credit Rules, 2002 vide Notification No.40/2003-CE(NT), dt.30.4.03, wherein the provisions of transitional credit was made available to the stock of inputs lying as on 1.4.03. An assessee who has made declaration in terms of earlier rule in respect of stock lying as on 31.3.03 was required to make a fresh declaration in respect of stock of the goods lying as on 1.4.03. However, where the stock as on 31.3.03 and 1.4.03 was identical, an intimation was required to be given to the Department to the effect that his declaration made earlier may be taken as declaration of the goods lying in stock as on 1.4.03.
3. As the appellant have filed declaration on 7.4.03 and took credit on 20.4.03 and did not file subsequent intimation in terms of Rule 9A(5) as regards correctness of the stock being the same as on 31.3.03 and 1.4.03, the department entertained a view that they were not entitled to avail the credit. Accordingly, a show cause notice was issued to the appellant, proposing to deny the CENVAT Credit of Rs.85,06,975/- as also proposing imposition of penalty.
4. Subsequently, an addendum was issued to the show cause notice proposing to deny CENVAT Credit of Rs.24,26,060/- on the ground that the inputs were still in transit and had not arrived at the appellants factory.
5. The appellants in their written submission, submitted that they had already filed declaration on 7.4.03 in respect of stock lying as on 31.1.03, the question of further intimation as regards no change of stock as on 1.4.03, was not required. Even, if the same was required in terms of Rule 9A(5), non-filing of such intimation cannot be held to be against them so as to deny them the substantive benefit of MODVAT Credit. As regards credit on grey fabrics in transit, they submitted that the same has been purchased by them and the same were in transit lying in different places in their name and on their behalf. Inasmuch as the grey fabrics stand owned by them, it has to be held that they are a part of stock hold by them.
6. The above submissions stand rejected by the Commissioner and duty stand confirmed along with imposition of penalty of Rs.10 lakhs. The said order is impugned before us.
7. Learned advocate appearing for the appellant submits that the legal issue now stand decided by various decisions of the Tribunal in respect of both the disputed points. He relies upon following decisions of the Tribunal.
a) M/s Krishna Screen Art Vs. CCE AHD-2009 (233) ELT 395 (Tri-Ahd)
b) M/s V.V. Prints Vs. CCE Rajkot - 2008 (232) ELT 807 (Tri-Ahd)
c) M/s Vaibhav & Co Vs CCE Coimbatore 2010 (252) ELT 542 (Tri-Chennai)
d) M/s Jaldharshan Textile Vs CCE Rajkot 2009 (243) ELT 751 (Tri-Ahd)
e) M/s Elcon Fabrics Vs. CCE Rajkot - 2007 (216) ELT 694 (Tri-Ahmd.)
8. The ratio of the above decisions is that as long as there is no dispute about the stock of grey fabrics lying with the assessee as on 31.3.03/1.4.03, the MODVAT Credit cannot be denied to them, on the ground of non-filing of requisite declaration or late filing of such declaration or non-filing of intimation. It stand held that the purpose of filing requisite declaration is to put the Revenue to notice in respect of such stock and to enable them to verify the same. Similarly, the above judgments have also held that whether the grey fabrics are still in transit, but actually stand purchased and duty has been paid by the assessee, credit is available in respect of such inputs.
9. As legal issue has been decided in favour of the assessee by above referred judgments of the Tribunal, we set aside the impugned order and remand the matter to Commissioner for actual verification of the stock of goods lying as on 1.4.03 as also the stock in transit.
10. The impugned order is set aside and matter remanded to Commissioner in above terms.
(Pronounced in Court)
(B.S.V. Murthy) (Archana Wadhwa)
Member (Technical) Member (Judicial)
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