Custom, Excise & Service Tax Tribunal
M/S Monarch Catalyst Pvt. Ltd vs Commissioner Of Central Excise, ... on 21 October, 2016
IN THE CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL WEST ZONAL BENCH AT MUMBAI COURT NO. II APPEAL NO. E/74/12-Mum. [Arising out of Orders-in-Appeal No. YDB/223/Th-I/2011 dated 13.10.2011 passed by the Commissioner of Central Excise (Appeals), Mumbai-I] Date of hearing: 01.07.2016 Date of decision: 21.10.2016 For approval and signature: Honble Mr. Devender Singh, Member (Technical) =======================================================
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?
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M/s Monarch Catalyst Pvt. Ltd
:
Appellant
VS
Commissioner of Central Excise, Thane-I
:
Respondents
Appearance:
Ms. Pooja Reddy, Advocate for the Appellant
Sh. H.M. Dixit, A C (AR), for the Respondent
CORAM:
Honble Mr. Devender Singh, Member (Technical)
FINAL ORDER NO. ______________________
Per : Devender Singh
The issue involved in this appeal is whether Cenvat Credit on input service taken by unit-II of the appellants could be utilized by unit-I.
2. Brief facts of the case are that the appellants M/s Monarch Catalyst Pvt. Ltd., A-94 & F-1/2, Phase-I, MIDC, Dombivli (E) (unit-I) have availed Cenvat Credit invoices which are not in their name but are in the name of other unit of the appellants located at Plot No. W-62, MIDC Phase II, Dombivli. The appellants had not taken registration as Input Service Distributors (ISD) under Rule 4(A) of Service Tax Rule, 1994. Unit-II is the job worker for the appellants. The adjudicating authority confirmed the demand along with interest and imposed a penalty of equal amount under Rule 15 of Cenvat Credit Rules. The party went in appeal. The order of adjudicating authority was upheld and the appeal was rejected. Aggrieved by the same the party before this Tribunal.
3. The Ld. Advocate for the appellants submitted that the appellants had kept the Assistant Commissioner, Central Excise, Kalyan, duly informed about the processing on job work basis at unit-II of the appellants by way of letter dated 13.02.1997. She stated that it was only a procedural lapse that they had not taken inputs ISD registration for which the benefit of Cenvat Credit cannot be denied. For a procedural lapse substantive benefit should not be denied. The Ld. Advocate relied upon following case laws in support of her contentions:-
(i) Sri Krishan Pharmaceuticals Ltd. Vs. CCE, Cus. & S.T., Hyderabad-III 2015 (40) S.T.R. 1039 (Tri. Bang.)
(ii) Greaves Cotton Ltd. Vs. CCE, Chennai-II & IV 2015 (37) S.T.R. 395 (Tri Chennai) She also contested the extended period and stated that there was no requirement of law during the given period for declaring details of service tax credit and adjudication order and appellate order had not given details of suppression.
4. The Ld. A.R. stated that Unit-II was not mentioned in the Central Excise Registration of the party invited attention to Para 8 of Order-in-Original and contended that in the definition of input service the word used is manufacturer and not the job worker. He also stated that demand was not time barred because the show cause notice had been issued within one year date of noticing the violation. The Ld. A.R. relied upon following case law for extended period:-
M/s Mahindra Sona Ltd. Vs. CCC, Nashik 2016-TIOL 1174-CESTAT-MUM
5. Heard the parties and perused the records.
6. I find that the appellants had kept the jurisdictional authority duly informed about the job work for them being done at their Unit-II. The procedure for registration as Input Service Distributer came into being on 16.06.2005, which is in the middle of the period involved in this case from June 2004 to February 2006. Admittedly, there was nexus between Unit-I and Unit-II. There is no allegation that credit was not admissible. It is merely that the procedure which came into being in June, 2005 was not followed. In the case laws relied upon by the appellants, the Tribunal has repeatedly held that in case of procedural irregularity, the substantive benefit should not be denied. In this regard following case laws relied upon by the appellants are pertinent:-
(i) Pricol Ltd. Vs. CCE, Coimbatore 2015 (38) S.T.R. 668 (Tri.-Chennai)
(ii) Sri Krishna Pharmaceuticals Ltd. Vs. CCE, Cus. & S.T., Hyderabad-III 2015 (40) S.T.R. 1039 (Tri. Bang.)
3. In view of the above the Cenvat Credit of Rs. 34528/- is held to be admissible to the appellants. In the result, the appeal is allowed with consequential relief, if any, to the appellants.
(Order pronounced in the court on 21.10.2016) Devender Singh Member (Technical) NS 4 E/74/2012-Mum