Custom, Excise & Service Tax Tribunal
Ashok Leyland Ltd vs Commissioner Of Central Excise on 15 June, 2015
IN THE CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL
SOUTH ZONAL BENCH AT CHENNAI
Appeal No.E/252/2007
[Arising out of Order-in-Appeal No.78/2006 (M-III) dated 28.12.2006 passed by the Commissioner of Central Excise (Appeals), Chennai]
Ashok Leyland Ltd.
Appellant
Versus
Commissioner of Central Excise,
Chennai-III Respondent
Appearance:
Shri M. Kannan, Advocate For the Appellant Shri L. Paneer Selvam, AC (AR) For the Respondent CORAM:
Honble Shri R. Periasami, Technical Member Date of hearing/decision :15.6.2015 FINAL ORDER No.40630/2015 This is second round of litigation before this Bench. The present appeal is arising out of de novo Order-in-Appeal No.78/2006 dt. 29.12.2006 passed by Commissioner (Appeals). The adjudicating authority confirmed the reversal of modvat credit of Rs.20,72,452.55 irregularly availed by the appellant on various grounds. The Commissioner (Appeals) in the first OIA No.61/99 dt. 30.3.1999 dismissed the appeal for non-compliance of predeposit against which appellant preferred appeal before this Tribunal and the Tribunal vide Final order No.661/2006 dt. 28.7.2006 remanded the matter to LAA by taking into account that appellant have already reversed the entire amount as predeposit. Pursuant to remand of Tribunal, the Commissioner (Appeals) passed the impugned order wherein he rejected the appeal of the assessee and upheld the demand.
2. Ld. Advocate appearing on behalf of the appellant submits that out of the total disputed credit, an amount of Rs.19,50,097 is towards credit availed on the certificate issued by Customs after introduction of Rule 57F (4A) w.e.f. 16.3.95. He submits that there are two Tribunal's order in the appellant's own case on the identical issue. One is passed by Single Member Bench reported in 2001 (138) ELT 544 (Tri.-Chennai) in favour of the appellant. Another decision is passed by Division Bench of the Tribunal reported in 2002 (148) ELT 453 (Tri.-Chennai) wherein the Tribunal rejected the appeal of the assessee.
3. Regarding denial of cenvat credit availed on three invoices issued by non-registered persons, he submits that the supplier, M/s.Bihar Alloys Steels Pvt. Ltd. have availed benefit of Notification No.27/92-CE (NT) dt. 9.10.1992 as they are exempted from operation of Rule 174 who has authorized M/s.Global Steels Pvt. Ltd. who actually fabricated the goods for them. As per the rule, the entire Central Excise formalities have to be complied by the job worker including payment of duty. Invoice issued by the supplier M/s.Bhiar Alloy Steels Ltd. clearly mentions the manufacturer details which is care of M/s.Globe Steels Pvt. Ltd. He also produced copy of letter dt. 30.7.96 issued by the jurisdictional Range Superintendent, Madras and it is confirmed that they are entitled to avail the credit and the invoice issued by the supplier is availing the notification No.27/92.
4. On the other hand, Ld. AR reiterates the finding in the impugned order and submits that once the person is not registered with Central Excise, he cannot raise invoice. Therefore, appellant cannot avail cenvat credit. He also submits that regarding the denial of cenvat credit under Rule 57E, this Tribunal again vide Order No.975/2006 dt. 26.10.2006, dismissed the assessee's appeal following earlier Tribunal's order (supra).
5. After hearing both sides, I find that the first issue relates to denial of modvat credit availed on 57E certificates issued by the Customs for payment of CVD after the amendment of Section 57F (4A) w.e.f 16.3.95. The second issue is denial of modvat credit on ineligible document issued by the supplier who is not registered with Central Excise.
6. As regards the denial of cenvat credit availed by the appellant based on 57E certificate issued by Customs, the Division Bench of this Tribunal in the appellant's own case (supra) and in Tribunal Final Order No.975/2006 dt. 26.10.2006 had rejected their appeal on the identical issue pertaining to the demand confirmed for the subsequent periods. The relevant paragraph-6 of Tribunal's decision reported in 2002 (148) ELT 453 (Tri-Chennai) decision is reproduced as under :-
"6. We have gone through the whole case records and the impugned orders of the Commissioner (Appeals). The learned Counsel confined his argument only in respect of Rule 57E in both these appeals. Accordingly, we proceed to decide the appeals. The plea of the learned Counsel was that fresh duty was paid after 16-3-95 and 57E certificate was issued by the Supdt. in respect of this amount and therefore they are claiming Modvat credit of this amount. We do not find any evidence on record that fresh duty was paid after 16-3-95. The Supdt. of Central Excise had issued certificate under Rule 57E for the Modvat credit which has been expunged/lapsed and not for any amount paid after 16-3-95 as duty. From the grounds of appeal also we find that the appellants has submitted that credit in any case had been availed only after 16-3-95 and the certificate has been issued much later than 16-3-95. They have further stated that there is nothing in Rule 57E to suggest that credits if any that may arise under Rule 57E in respect of such credits already availed prior to 16-3-95 and which has been lapsed on account of Rule 57F(17) would also lapse when such credit is availed. They contend that Rule 57F(17) (erstwhile 57F(4A) has not stated that any subsequent credits to which the assessee may become eligible on account of other provisions of law would also lapse if the original credits in regard to such differential duty credits which had been availed prior to 16-3-95 had also lapsed on account of Notification No. 11/95, dated 16-3-95. They submit that they are entitled for the credit availed based on certificates under Rule 57E. We would have accepted their contention if they had made original payment of duty after 16-3-95 and certificate-A was issued in respect of duty paid on the inputs on or after 16-3-95. Since the facts are otherwise, in our opinion, the orders passed by the Commissioner (Appeals) cannot be faulted with. We, therefore, do not find any merits in the appeals and the same are rejected."
7. In view of this Tribunal's Division Bench order dt. 3.5.2002 and 26.10.2006, appellant is not entitled to cenvat credit of Rs.10,50,097/- availed by the appellants after the amendment of Section 57F (4A) w.e.f. 16.3.95. Accordingly appeal is liable to be dismissed aside on this issue.
8. On the second issue, I find from the records that appellants have availed modvat credit of Rs.1,14,005/- on three invoices all dated 6.8.96 issued by M/s.Bihar Alloys Steels Ltd. On perusal of the letter OC No.535/96-97 dt. 30.7.96 issued by the jurisdictional Superintendent Range IX F addressed to the appellant the Superintendent informed the appellant that supplier M/s.Bihar Alloy Steels Ltd. is availing notification No.27/92-(CE-NT) dt. 9.10.92 and the supplier has authorised M/s.Global Steels Pvt. Ltd. who actually fabricates the goods for M/s.Bihar Alloys Steels Ltd. and complied with all Central Excise formalities under Central Excise and Salt Act,1944. The Range Superintendent also certified that even though M/s.Bihar Alloy Steels Ltd. is not registered under his range and does not have a e.c.c. code number, they are eligible to remove the goods under their invoices based on which they party buying the said goods can take modvat credit. Further, on perusal of Invoice No.003 dt. 25.4.96 issued by M/s.Bihar Alloy Steels, it is seen that the invoice is issued to the appellant. In the invoice, name and address of the supplier is mentioned as M/s.Bihar Alloy Steels Ltd. C/o M/s.Globe Steels Pvt. Ltd. The Notification No.27/92-CE(NT) dt. 9.10.92, clearly exempts from taking registration under Rule 174 of every manufacturer who gets his goods manufactured on his account from any other person. The said notification clearly stipulates that the person who is getting the goods manufactured and availing the exemption notification shall discharge all liabilities. Therefore, invoice issued by the supplier who is exempted from taking registration is a valid document. Further, I find that there is no dispute on the payment of Central Excise duty on the inputs. Accordingly, the appellants are eligible for credit of Rs.1,14,005/-.
9. In view of foregoing discussions, I hold that the demand of Rs.19,50,097/-is upheld. Demand of reversal of modvat credit of Rs.1,14,005/- is set aside. Impugned order is modified to this extent. Appeal is partially allowed.
(Dictated and pronounced in open court) (R. PERIASAMI) TECHNICAL MEMBER gs 7