Custom, Excise & Service Tax Tribunal
Apollo Metalex Pvt Ltd vs Noida on 6 August, 2019
CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL
ALLAHABAD
REGIONAL BENCH - COURT No. I
Excise Appeal No.70888 of 2018-Single Member
(Arising out of Order-in-Appeal No. NOI-EXCUS-002-APP-1923-17-18 dated
26/03/2018 passed by Commissioner of Central Tax (Appeals), Noida)
M/s Apollo Metalex Pvt. Ltd. .....Appellant
(A-25, Industrial Area, Sikandrabad,
Distt.-Bulandshahar, U.P.-203001)
VERSUS
Commissioner of Central Tax, Noida ....Respondent
(Noida) APPEARANCE:
Shri Vinayak Kohli, Proxy Counsel for the Appellant Shri Santosh Kumar Agarwal, Authorised Representative for the Respondent CORAM:
HON'BLE SMT. ARCHANA WADHWA, MEMBER (JUDICIAL) FINAL ORDER NO. - 71521 / 2019 Date of Hearing : 08 August, 2019 Date of Pronouncement : 09 August, 2019 PER: ARCHANA WADHWA The appellant has made a request to decide the matter in the light of decision of the Tribunal in the appellant's own sister concern involving an identical issue. Accordingly, I have heard learned A.R. appearing for the Revenue and have gone through the impugned order.
2. As per facts on record, the appellant is engaged in the manufacture of tubes during the manufacture of which unusable Excise Appeal No.70888 of 2018-Single Member 2 waste/residue is generated in the nature of flux skimming/zinc dross etc. the said waste is being sold by the assessee.
3. Revenue by entertaining a view that inasmuch as the appellant has availed Cenvat credit of duty paid on the common Cenvatable inputs used in the manufacture of excisable goods as also in the manufacture of said dross/skimming, they are required to pay 10% of the value of the said waste material in terms of the provisions of Rule 6(3) of Cenvat Credit Rules. It is the Revenue's case that as per the amendment carried in the said Rule with effect from 01/03/2015, the non-excisable goods have to be treated as exempted goods and as such the appellant was required to pay a particular percentage of the value of the zinc scrap.
4. I find that the issue stands decided by the earlier decision of the Tribunal. Particular reference can be made to the Tribunal decision in the case of M/s APL Apollo Tubes Ltd. Final Order No.40925/2019 dated 12/07/2019 vide which an identical situation was considered by the Tribunal and the dispute was resolved in favour of the assessee. For better appreciation the relevant Para-5 of the said order is reproduced below:-
"5. The issue is whether appellants have to pay an amount of 6% of the value of the zinc scrap cleared by them. The department has relied upon Explanation (1) introduced w.e.f. 01.03.2015 to demand the duty raised in the SCN. It has to be seen that though the said Explanation puts forward a deeming provision that non-excisable goods cleared by payment of consideration are also to be considered as exempted goods, there is no corresponding amendment made in sub-rule (1) of Rule 6 so that the goods that emerged out of process of manufacture falling in clause (1) are also to be considered as exempted goods. As per settled decisions, the goods which are not consciously manufactured by the appellants and which emerged in the process of manufacture cannot be considered as goods manufactured by the appellants. Thus, when the zinc Excise Appeal No.70888 of 2018-Single Member 3 scrap which is a waste arising out of process of manufacture of finished goods, is not goods manufactured by the appellant, the same cannot be considered as exempted goods manufactured by them. The Tribunal in the case of M/s. Bajaj Hindustan Sugar Ltd. vide Final Order stated supra had occasion to consider the very same issue and held as under:
"4. After hearing both the sides duly represented by learned AR, Shri Mohammad Altaf appearing for the Revenue and learned advocate Ms. Stuti Saggi on behalf of the respondent, we find that the issues are no more res integra. The Revenue's only grievance is that the precedent decision followed by the Commissioner (Appeals) would not apply after amendment in the provisions of sub-rule (1) of Rules 6 of Cenvat Credit Rules adding an explanation therein w.e.f. 01 March, 2015. We find that the said grounds of the Revenue was dealt with by the Tribunal in the case of Commissioner of Central Excise & Service Tax, Meerut-I V/s M/s Bajaj Hindusthan Sugar Ltd. vide Final Order No.70916/2019 dated 01 May, 2019 it was observed as under:-
"3. I have heard the learned Departmental Representative on behalf of the Revenue. The respondents were manufacturers of sugar and molasses. They were removing Bagasse and Press Mud. The period covered is from 1st March 2015 to 31st March 2016. In view of the amendment in explanation under sub-rule (1) of Rule 6 of Cenvat Credit Rules, 2004 w.e.f. 01.03.2015 there was an obligation on the part of the manufacturer to pay amount under sub-rule 3 of said Rule 6 at a fixed percentage of the value of non-excisable goods removed when Cenvat Credit on input and input services were availed and such inputs and input services were used in the manufacture of excisable as well as exempted goods including non-excisable goods. Therefore proceedings were initiated against the respondent for recovery of around Rs.44.00 Lakhs. On perusal of record I note that the issue is covered by precedent decision in respondent's own Excise Appeal No.70888 of 2018-Single Member 4 case in respect of their another unit through Final Order No.70801/2019 dated 18.04.2019. It was held in the said Final Order that Press Mud and Bagasse are not arising out of manufacturing activity and the same are agricultural waste and residue and therefore since the said Final Order is applicable in the present case I uphold the impugned order and reject the appeal filed by Revenue."
Similar decision has been taken in the other final orders relied upon by the Ld. counsel for the appellant. Respectfully following the decision of the Division Bench of the Tribunal, I am of the view that that the demand cannot sustain. The impugned orders are set aside. Appeal is allowed with consequential relief, if any, as per law."
5. Inasmuch as the issue stands decided, I set aside the impugned order and allow the appeal with consequential relief to the appellant.
(Order pronounced in the open court on - 09/08/2019) Sd/-
(Archana Wadhwa) Member (Judicial) Lks