Custom, Excise & Service Tax Tribunal
4. Whether Order Is To Be Circulated To ... vs M/S Intas Pharmaceuticals Ltd on 30 July, 2009
IN THE CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL
WEST ZONAL BENCH AT AHMEDABAD
COURT:
II
Appeal No.E/577 to 581/2009
Arising out of OIA No.185 to 189/2008(Ahd-II)CE/ID/Commr(A)/Ahd, dt.02.01.2009.
Passed by: Commissioner of Central Excise & Customs (Appeals), Ahmedabad.
For approval and signature:
Honble Mrs. Archana Wadhwa, Member (Judicial)
1. Whether Press Reporters may be allowed to see the No
Order for publication as per Rule 27 of the CESTAT
(Procedure) Rules, 1982?
2. Whether it should be released under Rule 27 of the Yes
CESTAT (Procedure) Rules, 1982 for publication
in any authoritative report or not?
3. Whether their Lordships wish to see the fair copy of Seen
the order?
4. Whether order is to be circulated to the Departmental Yes
authorities?
Appellant:
M/s Intas Pharmaceuticals Ltd.
Respondent:
CCE Ahmedabad II Represented by:
Shri Anand Mishra, Advocate for the Assessee; Shri S.K. Mall, SDR for the Revenue.
CORAM:
MRS. ARCHANA WADHWA, MEMBER (JUDICIAL) Date of Hearing/Decision:30.07.09 ORDER No. /WZB/AHD/2009 Per: Mrs. Archana Wadhwa:
The appellants are engaged in manufacture of P&P medicaments falling under Chapter 30 of the first schedule of CETA, 1985. Some of the medicines manufactured by them became unfit for human consumption on account of expiry of time or for any reason and as such, are required to be destroyed. Such medicines are normally waste pharmaceuticals classifiable under Heading 3006 92 00 without any duty leviable on the same. At the time of destruction of such medicines, the appellants reversed the modvat credit of duty availed by them in respect of the inputs used in the manufacture of such waste pharmaceuticals. Subsequently, they filed refund claim on the ground that such reversal was not called for, which stand denied by the authorities below.
2. After hearing both sides, I find that the lower authorities have relied upon the Boards circular No.800/33/2004-CX, laying down that the credit of duty paid on the input used in the manufacture of finished goods which became damaged or destroyed, is not permissible and is required to be recovered along with interest. However, I find that Larger Bench of the Tribunal in case of M/s Grasim Industries Vs. CCE Indore 2007 (206) ELT 336 (Tri-LB), has examined the issue and has held that no reversal of credit is required in respect of the goods destroyed subsequently and in respect of which remission of duty stand granted. The objection of learned SDR that above decision would be applicable only in case where such remission of duty has been granted in respect of final product, cannot be appreciated. Though the waste pharmaceuticals do not require any formal remission of duty, having been specifically mentioned against entry No.3006 92 00 of the tariff, the effect is that the same are required to be destroyed in presence of the officers. The ratio of the law declared in the case of M/s Grasim Industries judgment, no credit taken in respect of inputs used in such destroyed goods is required to be reversed. Where such destruction of final product is with the permission of officers in terms of Rule 21 or otherwise would not make a distinguishing factor so as not to apply ratio of the Larger Bench to the facts of the instant case.
3. I also note that the Commissioner (Appeals) has taken note of the provisions of sub-rule 5C of Rule 3 introduced under Notification No.33/2007-CE(NT), dt.07.09.97, laying down that where payment of duty is remitted under Rule 21, the Cenvat Credit taken on the input used in manufacture of such goods shall be reversed. However, it is seen that said sub-rule was introduced w.e.f. 7.9.07 whereas the period involved in the present appeal is August 2007, when the Larger Bench of the Tribunal would be applicable. The said rule cannot be invoked for the past period.
4. In view of the above, I set aside the impugned order and allow the appeals with consequential relief to the appellant.
(Dictated & Pronounced in Court) (Archana Wadhwa) Member (Judicial) cbb ??
??
??
??
3