Custom, Excise & Service Tax Tribunal
Lona Industries Ltd vs Commissioner Of Central Excise, Raigad on 26 June, 2015
IN THE CUSTOMS EXCISE & SERVICE TAX APPELLATE TRIBUNAL
WEST ZONAL BENCH AT MUMBAI
Appeal No.
E/87921/13
- Mum
(Arising out Order-in-Appeal No. US/112/RGD/2013 dated 29.04.2013 passed by the Commissioner of Central Excise (Appeals), Mumbai)
For approval and signature:
Honble Mr. M.V. Ravindran, Member (Judicial)
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 No CESTAT (Procedure) Rules, 1982 for publication
in any authoritative report or not?
3. Whether Their Lordships wish to see the fair copy Yes
of the Order?
4. Whether Order is to be circulated to the Departmental Yes
authorities?
Lona Industries Ltd.
Appellant
Vs.
Commissioner of Central Excise, Raigad
Respondent
Appearance:
Shri V.Mahadevan, Advocate for the appellant Shri S. Hasija, Supdt.(AR) for the respondent CORAM:
Honble Mr. M.V. Ravindran, Member (Judicial) Date of hearing : 17-06-2015 Date of decision : 26.06.2015 O R D E R No:..
This appeal is directed against Order-in-Appeal No. US/112/RGD/2013 dated 29.04.2013.
2. Heard both sides and perused the record.
3. The issue involved in this case is regarding the Cenvat credit of `3,94,950/- availed by the appellant suo motu and later on confirmed by the lower authorities as ineligible Cenvat credit, interest thereof and equal amount of penalty.
4. Ld. counsel after giving overall picture of the issue would draw my attention that the entire case is hit by limitation inasmuch the amount was recredited by them in June 2006 after informing the department by a letter dated 30.05.2006. He would submit that show-cause notice was issued to the appellant on 25.03.2001 by invoking extended period which is incorrect.
4.1 On merits, it is his submission that Cenvat credit was availed on spare of capital goods, which was forcibly reversed by the preventive officers on 19.12.1998, which was done under protest. It is his submission that from January 1999 to January 2006, appellant had written various reminders to the authorities for allowing them to take re-credit as Cenvat credit availed was legal and legitimate. He would submit that none of the correspondence was responded to by the lower authorities. It is his submission that the Adjudicating Authority in this case has directed the appellant to produce various records for coming to a conclusion that credit availed by the appellant at the first instance was eligible could not be done as there was no show-cause notice for denying the Cenvat credit availed initially and that the documents/records were lost in the flood which occurred in Mumbai in July 2005.
5. Ld. Departmental Representative, on the other hand, would submit that the appellant has been shifting stand as to the documents on which the Cenvat credit was availed, inasmuch that initially it was informed that the documents were lost in flood; then, documents are kept in head office from there it was lost, etc. It is his submission that the appellant was unable to produce any documentary evidence of their claim that they have availed Cenvat credit on the capital goods and spares thereof were eligible to Cenvat credit. He would submit that regarding suo motu credit availed, the Larger Bench held that suo motu credit cannot be availed and appellant has to go through the procedure of refund as amended in Section 11B of Central Excise Act, 1944.
6. Considered the submissions made by both sides and perused the record.
7. The issue is regarding the recredit of an amount which was reversed by the appellant on 19.12.1998 under advice of the Preventive officer, when they visited the factory premises.
8. I find from the records that the appellants factory was visited by the Preventive officer on 19.12.1998 and they disputed the eligibility to avail Cenvat credit of certain items of capital goods; directed the appellant to reverse the Cenvat credit. The appellant had reversed the Cenvat credit on 19.12.1998. It is seen from the records that by letter dated 17.10.2000, appellant had informed the Superintendent of Central Excise in charge of Range I, that they were asked to reverse the modvat credit which they have reversed and requested the Superintendent to allow them recredit as they were eligible to do so as per Notification 25/96-CE. The said letter was followed by various letters, last one being 27.01.2006, under which they also requested the departmental authorities to grant them permission for availing recredit of the amount of `3,94,950/-
9. I find from the record that except for one letter dated 17.08.2005 from the Superintendent of Central Excise directing the appellant to produce original copy of RG23A part II, no other information was sought. I also find from the records in response to the letter dated 17.08.2005, appellant informed the Range officer that original RG23A part II was lying with them only. Despite so many correspondence entered into with the departmental authorities, the appellant by letter dated 30.05.2006 informed the Asst. Commissioner of Central Excise, Rasayani Division that they are taking recredit of the amount and did so by entry no. 940 dated 12.06.2006. It is not in dispute that the monthly excise return of June 2006 was filed with the Range authorities in time indicating therein the Cenvat credit availed by the appellant.
10. I find that despite such clear intimation and information from the appellants side in May 2006, revenue authorities issued a show-cause notice on 25.03.2011 invoking the extended period for seeking reversal of the amount of `3,94,950/- which, in my view, is blatantly time barred. The allegations in the show-cause notice are also very bland inasmuch it only said that the assessee deliberately suppressed the fact of recredit which is in contravention of Rule 3 of CENVAT Credit Rules, 2004.
11. I find that this allegation of the department is totally unsubstantiated in view of the fact that as narrated hereinabove by me, the Adjudicating Authority as well as the first appellate authority has just not passed any orders on the plea of appellant as demand being hit by limitation obviously because of the fact as reproduced by me that the department was aware of the recredit taken by the appellant in June 2006.
12. In my considered view, on the fact of such clear cut information given to the department for recredit of the amount in June 2006; the show-cause notice issued in 2011 is to be held as time barred and no suppression, misstatement is proved against the appellant.
13. The impugned order is set aside on the point of limitation itself. Appeal is allowed.
(Pronounced in Court on .) (M.V. Ravindran) Member (Judicial) //SR 6