Custom, Excise & Service Tax Tribunal
M/S Megha Engineering And vs Cc, Ce & St, Hyderabad-Iv on 2 August, 2016
CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL REGIONAL BENCH AT HYDERABAD Division Bench Court I Application No. E/EH/21430/2015 in Appeal No. E/22329/2015 (Arising out of Order-in-Appeal No. HYD-EXCUS-004-COM-030-15-16 dt. 07.09.2015 passed by CC, CE & ST, Hyderabad-IV ) For approval and signature: Honble Ms. Sulekha Beevi, C.S., Member (Judicial) Honble Sh. Madhu Mohan Damodhar, Member(Technical) 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 should be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not? 3. Whether their Lordship wish to see the fair copy of the Order? 4. Whether Order is to be circulated to the Departmental authorities? M/s Megha Engineering And Infrastructure Ltd., ..Appellant(s) Vs. CC, CE & ST, Hyderabad-IV ..Respondent(s)
Appearance Sh. P. Dwarakanath, Consultant for the Appellant.
Sh. Guna Ranjan, Superintendent (AR) for the Respondent.
Coram:
Honble Ms. Sulekha Beevi, C.S., Member (Judicial) Honble Sh. Madhu Mohan Damodhar, Member(Technical) Date of Hearing: 02.08.2016 Date of Decision: 02.08.2016 FINAL ORDER No._______________________ [Order per: Madhu Mohan Damodhar] The facts of the case as put forth by the appellant are:
(a) The appellant are engaged in the manufacture of MS pipes, which are subject to duty of excise. As a manufacturer, they are also availing CENVAT Credit of the excise duty paid on their inputs, the most important input being, MS plates. Whenever entitled, they are clearing the pipes by claiming exemption from payment of duty of excise under Notifications 3/2004-CE 08.01.2004 or 6/2006-CE dt. 01.03.2006 as the case may be. Whenever the pipes are cleared by claiming exemption, the appellant follow the procedure prescribed under Rule 6(3) of the CENVAT Credit Rules, 2004, paying an amount equal to 10% / 5% / 6% of value of the exempted goods being cleared. Whenever such exemption is not entitled, the appellant clear their final products, viz., MS pipes on payment of appropriate duty of excise.
(b) The appellant are also a major infrastructure company executing various projects involving laying of pipelines. The appellant undertake such work by using the pipes manufactured by them. While such works undertaken for commercial entities would attract the levy of service tax, such works undertaken by the appellant for the State Government for public irrigation purposes, would not be liable to service tax. Such works executed by them involve transfer of property in goods and hence considered as works contracts and the appellant are paying service tax under works contract service, for such projects executed for commercial purposes, by opting for the composition scheme of payment of service tax, under the erstwhile, Works Contract (Composition scheme for payment of service tax) Rules, 2007.
(c) Wherever such works are executed for the Government, the appellant are not paying any service tax and the issue has been decided in favour of the assessee by the Honble CESTAT (Larger Bench), Bangalore in the case of M/s Lanco Infratech Ltd., Vs CC, CE & ST, Hyderabad [(2015 (38) S.T.R. 709 (Tri.-LB)].
(d) Show cause notices dated 07.11.2014 and 22.04.2015 were issued them alleging that in as much as the appellant have availed CENVAT Credit on the MS plates meant for the manufacture of the MS pipes, which are again used in the subject works contracts, they have not satisfied the above condition for availing composition scheme. It has been further alleged in the show cause notices that the appellant have misrepresented the facts as if the manufacturing unit and
(e) service tax registration are two separate entities. Hence, the notices proposed to disallow and recover CENVAT Credits availed by the appellant during the period from October, 2013 to December, 2014.
(f) After due process of law, adjudicating authority passed the impugned Order-in-Original bearing dated 07.09.2015 confirming the demand for denial of CENVAT Credit amounting to Rs. 46,23,65,752/- along with interest and equal penalty.
(g) Aggrieved by the impugned order, the appellant is now in appeal.
2. During the hearing, Ld. counsel for the appellant Sh. P. Dwarakanath pointed out that on identical issue, in their own case, but for earlier periods, the Tribunal Vide Final Order 22063-22065/2015 dated 14.10.2015 have allowed their appeals. Ld. counsel also stated that to the best of their knowledge, the said Tribunal decision has been accepted by the department and that they have not received any further SCN on the issue.
3. Sh. Guna Ranjan, learned AR fairly conceded that the matter is covered in favour of the appellant by the Tribunal Order supra.
4. In view thereof, following the Tribunal decision in the appellants own case, we allow the impugned appeal, with consequential benefits, if any, as per law.
(Pronounced & dictated in open court)
(MADHU MOHAN DAMODHAR) (SULEKHA BEEVI C.S.)
MEMBER(TECHNICAL) MEMBER(JUDICIAL)
Jaya.
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