Custom, Excise & Service Tax Tribunal
M/S. Commander Watertech Pvt Ltd vs Commissioner Of Central Excise, Pune on 8 March, 2016
IN THE CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL WEST ZONAL BENCH AT MUMBAI COURT NO. II APPEAL NO. E/1108/11 [Arising out of Order-in- Appeal No. PIII/VM/68/2011 dated 23/3/2011 passed by the Commissioner of Central Excise (Appeals-III), Pune] For approval and signature: Honble Mr Ramesh Nair, 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 :
CESTAT (Procedure) Rules, 1982 for publication
in any authoritative report or not?
3. Whether Their Lordships wish to see the fair copy : seen
of the Order?
4. Whether Order is to be circulated to the Departmental: Yes
authorities?
=======================================================
M/s. Commander Watertech Pvt Ltd
:
Appellants
VS
Commissioner of Central Excise, Pune
:
Respondent
Appearance
Shri. D.H. Nadkarni, Advocate for the Appellants
Shri. V.K. Shastri, Asstt. Commissioner(A.R.) for the Respondent
CORAM:
Honble Mr. Ramesh Nair, Member (Judicial)
Date of hearing: 8/3/2016
Date of decision: 8/3/2016
ORDER NO.
Per : Ramesh Nair
This appeal is directed against Order-in- Appeal No. PIII/VM/68/2011 dated 23/3/2011 passed by the Commissioner of Central Excise (Appeals-III), Pune whereby Ld. Commissioner(Appeals) upholding the Order-in-Original No. PVIII/44/Adjn/CEX/10-11 dated 29/10/2010 rejected the appeal.
2. The fact of the case is that appellant is engaged in the manufacture of Flushing System of Plastic on which they are paying duty on MRP based valuation under Section 4A of the Central Excise Act, 1944. The appellant mistakenly paid the excise duty on the transportation which was otherwise not required to be paid and subsequently they have taken suo moto credit in their Cenvat account for the amount of duty paid on the freight. The said credit was made on 28/3/2008. The Show Cause Notice was issued proposing disallowance of the credit on the ground that suo moto credit was not permissible. The appellant should have filed the refund claim. The Adjudicating authority confirmed the demand and imposed the penalties. The appeal filed by the appellant before the Commissioner(Appeals) was rejected therefore the appellant is before me.
3. Shri. D.H. Nadkarni, Ld. Counsel for the appellant submits that appellant had taken credit on the belief that duty was paid mistakenly which was not suppose to be paid, therefore they have taken suo moto credit during the period involved. There are various judgments available according to which suo moto credit was permitted, some are cited below:
(a) Gujarat Alkalies & Chemicals Ltd Vs. Commr. C. Ex. Vadodara-II [2005(190) ELT 406(Tri. Mumbai)]
(b) Visakhapatnam Steel Plant Vs. Commr. C. Ex. Vasakhapatnam[2002(149) ELT 708 (Tri. Bang.)]
(c) Commissioner of Central Excise, Indore Vs. Indore Wire Company Ltd[2006(203) ELT 314(Tri. Del.)]
(d) Anapurna Malleables Pvt Ltd Vs. Commissioner of C. Ex. Jaipur[2006(194) ELT 458(Tri. Del.)]
(e) Commissioner of Central Excise, Noida Vs. Flex Industries Ltd[2005(180) ELT 251(Tri. Del.)]
(f) USV Ltd Vs. Commissioner of Central Excise, Pune-II[2007(210) ELT 376(Tri. Mum)]
(g) Commissioner of Central Excise, Hyderabad Vs. Sanghi Polyesters [2004(169) ELT 128(Tri. Bang.)] He further submits that the issue of suo moto credit was referred to the Larger Bench due to conflicting judgments of the issue. The Larger Bench decided that suo moto credit is not permissible and only remedy is to file refund claim under Section 11B of Central Excise Act, 1944. He referred the judgment in case of BDH Industries Ltd. Vs. Commissioner of Central Excise, Mumbai[2008(229) ELT 369 (Tri. LB)]. He submits that since there were conflicting views and matter referred to the Larger Bench the extended period cannot be invoked as held by the Honble Supreme Court in case of Continental Foundation Jt. Venture Vs. Commr. of C. Ex. Chandigarh-I [2007(216) ELT 177(S.C.)]. He further submits that the fact of taking suo moto credit was explicitly declared in their monthly return for the month of March 2008 in respect of excess payment of duty on freight. For this reason also there is no suppression of facts on the part of the appellant, hence the extended period cannot be invoked, the demand is time bar.
4. Shri. V.K. Shastri, Ld. Asstt. Commissioner(A.R.) appearing on behalf of the Revenue reiterates the findings of the impugned order.
5. I have carefully considered the submissions made by both sides.
6. I find that there were various judgments of this Tribunal as cited by the Ld Counsel that the suo moto credit was allowed in respect of any duty paid mistakenly. However, due to conflicting views in some judgments the matter was referred to the Larger Bench and in the case of BDH Industries (supra) the Larger Bench has settled the conflict by holding that suo moto credit cannot be allowed and if at all any excess payment, remedy is to file refund claim under Section 11B, therefore in view of the conflicting views and matter finally decided by the Larger Bench, bonafide belief of the appellant cannot be doubted. Moreover, the appellant have clearly declared their suo moto credit in their return for the month of March, 2008 wherein details of suo moto credit was mentioned. From that entry it was clear that the appellant have taken suo moto credit in respect of excess paid duty on freight. As per this disclosure it cannot be said that there is suppression of fact on the part of the appellant. For this reason also demand cannot be raised under proviso to Section 11A(1), accordingly extended period cannot be invoked. In view of my above discussion, I am of the considered view that demand was wrongly made invoking the extended period, hence the demand is time bar. The impugned order is set aside, appeal is allowed on the ground of limitation alone.
(Dictated in court) Ramesh Nair Member (Judicial) sk 5 E/1108/11