Custom, Excise & Service Tax Tribunal
M/S. Jagdamba Ispat vs Cce, Jaipur on 31 January, 2014
IN THE CUSTOMS, EXCISE AND SERVICE TAX
APPELLATE TRIBUNAL, NEW DELHI
COURT NO. III
Excise Appeal No. 142/2012-EX[SM]
[Arising out of Order-In-Appeal No. 252 (DKV)CE/JPR-1/2011 dated 23.09.2011 passed by CCE, Jaipur]
For approval and signature:
Honble Ms. Archana Wadhwa, Judicial Member
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Whether Press Reporters may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?
No
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Whether it should be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?
No
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Whether Their Lordships wish to see the fair copy of the Order?
Seen
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Whether Order is to be circulated to the Departmental authorities?
Yes
M/s. Jagdamba Ispat Appellant
Vs.
CCE, Jaipur Respondent
Coram: Honble Ms. Archana Wadhwa, Judicial Member Appearance:
Shri Akarshan Kumar, Advocate for the Appellants Shri U.K. Srivastava, AR for the Respondent Date of Hearing: 31.01.2014 FINAL ORDER NO._ 50426 /2014_ Per Ms. Archana Wadhwa:
Based on the scrutiny of quarterly returns for the quarter ending Dec 2004, a show cause notice dated 19.1.2005 was issued alleging that the appellant had wrongly taken Cenvat credit amounting to 2,55,830/-, in contravention of the provision of Rule 2 and 4 of the Cenvat credit Rules. The breakup of Cenvat Reversal sought therein is given as under;
(i) That the appellant had taken 100% Cenvat Credit of Rs. 58,519/- (Cenvat coupled with education cess) on capital goods treated as inputs instead of 50% i.e. Rs. 29,260/- in the financial year 2004-05, which was not admissible;
(ii) That the appellant had taken Cenvat credit of Rs. 1,43,868/- on the goods viz MS Bar, Cement, MS Angle, LTD Bar, wielding electrode, Channel Hoist and Joint as capital goods, utilized in the fabrication of shed, whereas shed was not goods as it was embedded to earth. Therefore Cenvat credit was not admissible in respect thereto; and
(iii) That the appellant had taken Cenvat credit of Rs. 80,702/- including education cess on Dharam Kanta, which was installed outside factory premises and thus no credit was admissible on it.
2. As regards the first issue, learned advocate submits that in any case balance 50% credit was available to the appellant in the next financial year and as such the issue involved is only of applicability of interest, which the appellant is ready to pay. I agree with the above contention, the only dispute is availment of 100% credit of duty paid on the capital good in the year of the receipt of the same. Admittedly the appellant were entitled to avail 50% in the first year and the balance 50% in the second year. Having availed the entire 100% in the first year, they have excess utilized the credit and such pre-mature utilization would invite interest amount. Accordingly, I direct the appellant to pay the interest, to be quantified by the lower authorities.
3. As regards the second issue, learned advocate fairly accept that the issue is decided against them by the Larger Bench decision in the Tribunal in the case of Vandana Global. As such he accept his duty liability, but submits that it is not a case of imposition of penalty inasmuch the entire credit was taken with the knowledge of the revenue.
I find that during the relevant period the precedent decision were in favour of the appellant. As such, I agree with the learned advocate that its not a case of penalty and accordingly, while upholding the demand, set aside the penalty.
4. As regards the third issue, learned advocate submit that the Dharam Kanta was installed immediately next to the barrier only of the appellant. He is ready to pay back the credit so availed but submit that inasmuch as the issue is contentionious and the credit was taken on statutory records, it is not a case for imposition of penalty.
In view of the above, while upholding the demand of Cenvat credit of Rs. 80,702/-. I set aside the penalty imposed upon the appellant on the said account.
5. The appeal is disposed of in above terms.
(Pronounce in the open Court on) (Archana Wadhwa) Member (Judicial) Jyoti* ??
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