Custom, Excise & Service Tax Tribunal
Gautam Weaving Mills vs Commissioner Of Central Excise, ... on 28 January, 2008
IN THE CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL WEST ZONAL BENCH AT MUMBAI COURT No. III APPEAL No. E/1197/07 (Arising out of Order-in-Appeal No. SRK/6/Bel/2007 dated 5.7.2007 passed by Commissioner of Central Excise (Appeals), Mumbai-II) For approval and signature: Hon'ble Ms. Jyoti Balasundaram (Vice President) ======================================================
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?
====================================================== Gautam Weaving Mills Appellant Vs. Commissioner of Central Excise, Belapur Respondent Appearance: Ms. Padmavati Patil, Advocate, for appellant Shri P.K. Katiyar, Authorised Representative (SDR), for respondent CORAM: Hon'ble Ms. Jyoti Balasundaram, Vice President Date of Hearing: 28.1.2008 Date of Decision: 28.1.2008 ORDER NO................................. Per: Ms. Jyoti Balasundaram, Vice President
The appellants herein are engaged in the manufacture of grey woven fabrics falling under Chapters 54 and 55 of the schedule to the Central Excise Tariff Act, 1985. They availed cenvat credit on inputs and utilised the same towards payment of central excise duty payable on the goods. It was noticed by preventive officers of central excise that the assessees had - (a) availed cenvat credit twice on the same goods (inputs), failed to discharge duty on certain finished goods and (c) availed cenvat credit on the basis of inadmissible documents. The amount of cenvat credit availed twice on the same goods was Rs.27,634/-. The duty liability on finished goods was Rs.18,182/- and credit availed on the strength of endorsed invoices was Rs.76,913/-. Show cause notice proposing recovery of the above mentioned amounts and also proposing levy of interest and imposition of penalty was issued; the modvat amount of Rs.27,634/- was reversed on 21.6.2005 and interest thereon of Rs.8,446/- was paid on 25.1.2006; on the second count, viz. duty liability of finished goods, the duty amount of Rs.18,182/- was reversed on 1.2.2006 and on the next day, interest thereon of Rs.2,435/- was also paid. The contest was only to denial of credit of Rs.76,913/- and to the penalty. The show cause notice was adjudicated by the Assistant Commissioner who confirmed the demands together with interest and also imposed a total penalty of Rs.1,22,720/-. His order was upheld by the Commissioner (Appeals); hence this appeal.
2. I have heard both sides and find force in the submission of the appellants that credit taken on strength of endorsed invoice is admissible to them in the light of the judgment of the Hon'ble Bombay High Court in Simplex Mills Co. Ltd. vs. CCE, Mumbai-IV 2007 (81) RLT 331 (Bom) following the earlier judgment of the same High Court in Marmagoa Steel Ltd. vs. UOI 2005 (192) ELT 82 (Bom). The High Court has held that if there is no dispute regarding the duty paid nature of the inputs and the inputs have undisputedly been received in the factory and the assessee has taken credit, that is sufficient for the purpose of availment of credit and the deficiency in the duty paying document is not to be held against the assessee for the purpose of denying the substantive benefit of modvat credit. Following the ratio of the above judgments, I set aside the denial of credit of Rs.76,913/- to the appellants. However, the penalty is not required to be set aside in toto for the reason that the other contraventions of law, viz. availment of credit twice on the same goods and no discharge of duty liability on certain finished goods, have already been upheld, and accepted by the appellants. The penalty imposed on these two counts is Rs.45,816/-. I accordingly reduce the penalty to Rs.45,816/-.
(Pronounced in Court) (Jyoti Balasundaram) Vice President tvu 1 3