Custom, Excise & Service Tax Tribunal
M/S Godawari Power And Ispat Ltd vs Cce, Raipur on 17 December, 2014
IN THE CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL West Block No. 2, R.K. Puram, New Delhi 110 066. Principal Bench, New Delhi COURT NO. III DATE OF HEARING/DECISION : 17/12/2014. Excise Appeal No. 3576 of 2012 with CO Application No. 56579 of 2013 [Arising out of the Order-in-Original No. Commissioner/RPR/CEX/ 47/2012 dated 30/08/2012 passed by The Commissioner, Central Excise, Raipur.] For Approval and signature : Honble Shri Rakesh Kumar, Member (Technical) Honble Shri S.K. Mohanty, Member (Judicial) 1. Whether Press Reporters may be allowed to see : the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982? 2. Whether it would 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 the order? 4. Whether order is to be circulated to the : Department Authorities? M/s Godawari Power and Ispat Ltd. Appellant Versus CCE, Raipur Respondent
Appearance Shri Rupinder Singh, Advocate for the appellant.
Shri M.S. Negi, Authorized Representative (DR) for the Respondent.
CORAM : Honble Shri Rakesh Kumar, Member (Technical) Honble Shri S.K. Mohanty, Member (Judicial) Final Order No. 54955/2014 Dated : 17/12/2014 Per. Rakesh Kumar :-
The appellant are manufacturer of sponge iron. One of the inputs used for manufacture of sponge iron is coal which they either import or they purchased from Coal India Ltd. The period of dispute in this case is from 01/03/11 to 23/3/11. Exemption Notification No. 63/95-CE dated 16/3/95 exempted unconditionally the coal of sub-heading 2702 and 2703 of the Central Excise Tariff if manufactured a mine from the whole of the duty of excise. However, by Notification No. 1/11-CE dated 01/3/11 and 2/11 dated 01/3/11, the Central Government prescribed a rate of duty of 1% in respect of the coal produced in the mines if no Cenvat credit had been taken and rate of 5% adv. with Cenvat credit. However, while issuing the Notification No. 1/11 and 2/11 dated 01/3/11, the earlier Notification No. 63/95-CE dated 16/3/95 was amended only w.e.f. 24/3/11 by Notification No. 29/2011 dated 24/3/11 by which full duty exemption extended to the coal produced in the mines, was withdrawn. Thus, during the period from 01/3/11 to 23/3/11 while Notification No. 1/11 and 2/11 prescribed rates of duty 1% and 5% without Cenvat credit and with Cenvat credit respectively, the exemption Notification No. 63/95-CE dated 16/3/95 extending full duty exemption without any condition in respect of the coal produced in the mines were also in force. The Department was of the view that during the period from 01/3/11 to 23/3/11 no duty was payable by Coal India Ltd. in respect of the coal produced by them and whatever amount was paid has to be treated as deposit and, therefore, the appellant were not eligible to avail Cenvat credit of the excise duty paid on the coal during this period. It is on this basis that Cenvat credit demand of Rs. 58,68,032/- has been confirmed against the appellant company alongwith interest with equal amount of penalty imposed on them under Rule 15 (2) of Cenvat Credit Rules, 2004 readwith Section 11AC of Central Excise Act vide order-in-original dated 30th August 2012 passed by the Commissioner. Against this order of the Commissioner, this appeal has been filed by the appellant. The respondent commission has filed cross objection in respect of this appeal.
2. Heard both the sides.
3. Shri Rupinder Singh, Advocate, the learned Counsel for the appellant, pleaded that the Tribunal in the case of Drolia Electrosteels Pvt. Ltd. vs. CCE & ST, Raipur wherein an identical issue was involved, vide final order No. 58633/2013 SM (BR) dated 12/12/2013 has set aside the Cenvat Credit demands on the ground that it is well settled law that the assessments made at the suppliers end cannot be opened at the recipient end and the recipient of the goods cannot be denied the Cenvat credit by reopening the assessments at the suppliers end and in this regard the Tribunal relied upon the judgments of Honble Punjab & Haryana High Court in the case of CCE, Chandigarh vs. Ranbaxy Labs Ltd. reported in 2006 (203) E.L.T. 213 (P&H) and in the case of V.G. Steel Industry vs. CCE reported in 2012 (27) S.T.R. 94 (P&H). He, therefore, pleaded that in view of this, the impugned order is not correct.
4. Shri M.S. Negi, learned DR, assailed the impugned order by reiterating the findings of the Commissioner.
5. We have carefully considered the submissions from both the sides and perused the records.
6. During the period of dispute, that is from 01/3/11 to 23/3/11, the coal received by the appellant from Coal India Ltd. was fully exempt from duty under Notification No. 63/95-CE dated 16/3/95 and at the same time duty @ 1% adv. has been imposed by Notification No. 1/11-CE subject to condition that no Cenvat credit is taken and duty @ 5% has been imposed under Notification No. 2/11-CE with Cenvat credit. The Department taking the view that since during the period of dispute, the coal supplied to the appellant Coal India Ltd. was fully exempt and, therefore, no duty ought to have been paid by Coal India Ltd. on the coal supplied by them to the appellant and any amount paid towards duty is to be treated as deposit, has sought to deny the Cenvat credit to the appellant. We find that this issue stands decided against the Department by the Apex court judgment in the case of MDS Switchgear reported in 2008 (229) E.L.T. 485 (S.C.) and same view has been taken by Honble Punjab & Haryana High Court in the cases of CCE, Chandigarh vs. Ranbaxy Labs Ltd. reported in 2006 (203) E.L.T. 213 (P&H) and in the case of V.G. Steel Industry vs. CCE reported in 2012 (27) S.T.R. 94 (P&H) holding that the assessments made at the suppliers end cannot be reopened at the recipients end and on this basis the Cenvat credit of the duty paid by the supplier cannot be denied to the recipient. In view of this, the impugned order is not sustainable. The same is set aside. The appeal is allowed. The Cross Objection filed by the Revenue also stands disposed of.
(Dictated and pronounced in open court.) (Rakesh Kumar) Member (Technical) (S.K. Mohanty) Member (Judicial) PK ??
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