Custom, Excise & Service Tax Tribunal
M/S. Ranjan Polyesters Limited vs Cce, Jaipur-Ii on 26 June, 2013
CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL, WEST BLOCK NO.II, R.K. PURAM, NEW DELHI-110066 COURT NO. II Central Excise appeal No. 3674/2005-Ex[DB] [Arising out of Order-in-Appeal No. 554(HKS)CE/JPR-II/2005 dated 18.10.2005 passed by the Commissioner (Appeals-II), Customs & Central Excise, Jaipur] Date of Hearing/decision: 26th June, 2013 M/s. Ranjan Polyesters Limited Appellant Versus CCE, Jaipur-II Respondent
Present for the Assessee : None
Present for the Revenue : Ms. S. Bector, A.R.
Coram: Honble Shri D.N. Panda, Judicial Member
Honble Shri Rakesh Kumar, Technical Member
FINAL ORDER NO. 56762/2013
Per D.N. Panda
None present for the appellant nor there is any application for adjournment. With the assistance of Revenue appeal was taken up for disposal since notice was issued on 3rd June, 2013 adjourning the matter to 26.6.2013.
2. Precisely allegation of Revenue as is apparent from the show cause notice reads as under:
Whereas, since CENVAT on yarn was allowed only from 1.4.2003, therefore, CENVAT was not admissible on the inputs (POY) which were used in the manufacture of the final products (Text. Yarn) cleared on payment of duty before 1.4.2003. The assessee had used POY for manufacture of the Text. Yarn which was cleared for captive use on payment of duty (CENVAT @ 2.5/- per kg + AED (TTA) @ 15% of CENVAT), therefore CENVAT credit was admissible for the duty paid Text. Yarn contained in the finish product. CENVAT credit on POY used in manufactured of Text. Yarn was not admissible because Text. Yarn had already been cleared on payment of duty for captive use before 1.4.2003. The assessee took double Cenvat credit, they took Venvat Credit on duty paid Text. Yarn laying in the stock and also for the duty paid POY used in the manufacture of this duty paid Text. Yarn.
From the above it is clear that the assessee has taken credit twice on 17651.52 kg of material [Grey Twisted W.I.P. (9882.00KG) +Grey twisted Finish Stock (143.84kr) + Dyeing W.I.P. (6777.41KG) + Dyeing Finish Stock (848.27 kg) = 17651.52 kg] first, by taking credit on POY contained with Grey Taxturised Yarn lying in W.I.P. and Grey Texturised yarn lying as finished Stock and secondly, by also takin credit of the duty paid on the same quantity of grey texturised yarn cleared for captive consumption for manufacture of grey twisted yarn [(BED @ Rs.2.50/- Per Kg + AED(T&TA) as 15% of BED amounting to Rs.50748/-)] and they have also taken credit on 427.00 kg of yarn waste. Whereas as per Rule 9A of Cenvat Credit Rules, 2002, the assessee was only entitled to take credit on the input content in the goods lying in stock or goods in process and as such for grey texturised yarn they were entitled to take credit of the POY, which being its input, and for the purpose of grey twisted yarn they were entitled to take credit on its input i.e. grey texturised yarn. Further rule 9A of Cenvat Credit Rules, 2002 does not provide credit on yarn waste of which the assessee has taken credit.
In this manner the assessee has taken excess Cenvat Credit amounting to Rs.3,45,199/- [BED Rs.1,84,711/- + SED (T&TA) Rs. 44,705/- + NCCD Rs. 2,462/-] during April, 2003 and as such they have contravened the provisions of rule 9A of the Cenvat Credit Rules, 2002.
The excess Cenvat Credit amounting to Rs.3,45,199/- Is liable to be recovered from them under the provisions of rule 12 of the Cenvat Credit Rules, 2002.
3. Learned D.R. says that notification No. 25/2003-CE dated 25.3.2003 intended to grant Cenvat credit in respect of inputs lying in stock as on 31.3.2003 but the goods claimed to be input by the appellant in the present appeal was not the input as on 31.3.2003 because that was already transformed into finished goods by ultimate consumption before 1.4.2003. Once the yarn was consumed before 1.4.2003 that was not lying in stock as on 31.3.2003 as per notification to get Cenvat credit. Accordingly, appeal should be dismissed.
4. We have examined the allegation in show cause notice as well as finding of the appellate authority. It is crystal clear that for the consumption of input the appellant has already availed Cenvat credit on input. After notification No. 25/2003-CE date d25.3.2003 the appellant again made attempt to avail Cenvat credit on yarn which was already transformed into finished goods. Therefore, there was no input existed as such to entitle the appellant to avail Cenvat credit further after 31.3.2003. Accordingly, both the authorities below have rightly rejected the claim of the appellant which does not require any interference. Consequently, appeal is dismissed.
(Dictated & pronounced in the Open Court.)
(RAKESH KUMAR) (D.N. PANDA)
TECHNICAL MEMBER JUDICIAL MEMBER
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E/3674/2005-Ex-[DB]