Custom, Excise & Service Tax Tribunal
M/S. Lml Limited vs C.C.E., Kanpur on 28 February, 2014
IN THE CUSTOMS, EXCISE & SERVICE TAX
APPELLATE TRIBUNAL
WEST BLOCK NO.2, R.K. PURAM, NEW DELHI 110 066
Date of Hearing 28.02.2014
For Approval &Signature :
Honble Mrs. Archana Wadhwa, Member (Judicial)
1.
Whether Press Reporter may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?
No
2.
Whether it would be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?
No
3.
Whether Lordships wish to see the fair copy of the order?
Seen
4.
Whether order is to be circulated to the Department Authorities?
Yes
Appeal No. E/819/2010 -EX[SM]
[Arising out of Order-in-Appeal No.06-CEX/APPL/KNP/2010, dated 12.01.2010, passed by C.C.E.(Appeals), Kanpur]
M/s. LML Limited Appellants
Vs.
C.C.E., Kanpur Respondents
Appearance Shri R. Santhanam, Advocate - for the appellants Shri BB Sharma, DR - for the respondent CORAM: Honble Mrs. Archana Wadhwa, Member (Judicial) Final Order No.50906/2014, dated 28.02.2014 Per Honble Mrs. Archana Wadhwa :
After hearing both the sides, I find that the appellants were availing the deemed CENVAT credit in respect of aluminium ingots, in terms of Notification No.202/83-CE, dated 20.05.2002. The deemed credit, in terms of the said Notification, was available on the condition that the inputs are not clearly recognisable as non-duty paid. The appellants were procuring the ingots from the market as also from various manufacturers.
2. The Revenue entertained a view that in as much as there is an Exemption Notification in respect of aluminium ingots, the manufacturers may be availing the benefit of the said Exemption Notification. As such, enquiries were made and it was found that certain manufacturers have cleared the ingots after availing the benefit of the Exemption Notification.
In view of the above, proceedings were initiated against the appellants for denial of the deemed CENVAT credit, resulting in confirmation of demand of duty and imposition of penalties. The said orders were set aside by the Tribunal and remanded for reconsideration, after examining the fact as to whether in all such cases, manufacturers have claimed the benefit of the exemption Notification. As in the some of the cases, the appellants have availed the credit on the basis of the purchases made from the dealers or the market, the Revenue allowed the credit to that extent and where there was a clear evidence that the manufacturers have availed the exemption Notification and as such the aluminium ingots purchased by the appellants were clearly recognisable as non-duty paid, the CENVAT credit to the extent of Rs.2,35,235/- (Rupees two lakh thirty five thousand two hundred and thirty five only) was disallowed and penalty of Rs.2 lakh (Rupees two lakhs only) was imposed.
3. Ld. Advocate fairly agrees that the issue on merits stands decided against them by the Larger Bench of the Tribunal in the case of Machine Suppliers Vs. CCE [1996 (83) ELT 576 (LB)].
However, he assails the demands on merits, which stands raised vide Show Cause Notice dated 17.05.1993, for the period 30.05.1988 to 11.09.1990. He submits that during the relevant period, there were decisions of the Tribunal in favour of the assessee as recorded in para 10 of the Larger Benchs decision. In this scenario, no mala fide can be attributed to the appellants so as to invoke the longer period of limitation.
4. Ld. Departmental Representative supports the invocation of the longer period of limitation by submitting that the condition of the Notification in question was quiet clear and as the appellants knew that the products have been cleared by the manufacturers by availing the exemption Notification, they should not have availed the deemed CENVAT credit.
5. Without going into the factual aspects as to whether the appellants had availed the deemed credit with/without the knowledge of the Revenue, I find that admittedly during the relevant period, there were decisions in favour of the assessee, thus necessitating it to refer the issue to the Larger Bench of the Tribunal. There are number of decisions of the Honble Supreme Court as also various courts and Tribunals laying down that when the law is reversed subsequently by the Larger Bench, an assessee cannot be blamed for following the earlier favourable decisions of the higher courts, in which case, the elements of invocation of extended period have to be held as absent. Reference can be made to the following decisions:-
(i) Continental Foundation Joint Venture Vs. CCE, Chandigarh-I [2007 (216) ELT 177 (SC)].
(ii) Jaiprakash Industries Ltd. Vs. CCE, Chandigarh [2002 (146) ELT 481(SC)].
(iii) M/s. High Tech Equipments & Spares Pvt. Ltd. [Final Order No.A/58186/2013-SM(BR), dated 05.11.2013].
(iv) CCE, Raipur Vs. Baldev Alloys Pvt. Ltd. [2012-TIOL-388-CESTAT-DEL].
6. In as much as the present demand is admittedly barred by limitation, by following the above decisions, I set aside the impugned order on the point of time bar and allow the appeal with consequential relief to the petitioner.
(Dictated and pronounced in the Open Court) (Archana Wadhwa) Member (Judicial) SSK -2-