Custom, Excise & Service Tax Tribunal
Honeywell Turbo Technologies India Pvt ... vs Commr Service Tax -I Pune on 17 March, 2022
CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL
MUMBAI
REGIONAL BENCH
Excise Appeal No. 85601 of 2016
(Arising out of Order-in-Original No. PUN-EXCUS-001-PR.COM-041-15-16 dated
07.12.2015 passed by the Commissioner of Central Excise & Service Tax, Pune-I.)
M/s. Honeywell Turbo Technologies India ........Appellant
Pvt. Ltd.
S. No. 287/1, Raisoni Industrial Estate,
Mann Village, Hinjewadi, Pune - 411 057
VERSUS
Commissioner of Service Tax-I, Pune ........Respondent
Pune ICE House, 41/A,
Sasson Road, Opp. Wadia
College, Pune-411 001
APPERANCE:
Shri Dharmendra Kumar Rana, Advocate for the Appellant
Ms. Anuradha S. Parab, Assistant Commissioner, Authorised
Representative for the Appellant
CORAM:
HON'BLE MR. SANJIV SRIVASTAVA, MEMBER (TECHNICAL)
HON'BLE DR. SUVENDU KUMAR PATI, MEMBER (JUDICIAL)
FINAL ORDER NO. A/85412 / 2022
Date of Hearing: 17.03.2022
Date of Decision: 17.03.2022
PER: DR. SUVENDU KUMAR PATI
Denial of CENVAT credit by the Commissioner of Central Excise
& Service Tax, Pune-I on input services on the ground that those
were not received at the factory of Appellant but at External
Warehouse having separate First Stage Dealer registration certificate
is assailed in this appeal.
E/85601/2016
2
2. Facts of the case, in brief, is that Appellant company was a
registered manufacturer of Turbo Charger Engines which had Internal
Warehouse (IWH) too with separate registration certificate. As per
scheme of arrangement sanctioned by the Hon'ble Bombay High
Court vide his order dated 05.07.2013, both the company and
Warehouse got amalgamated with due intimation to the jurisdictional
Central Excise Authority made on 29.07.2013. All service providers
raised invoices to the Appellant thereafter and it had availed CENVAT
credit on input services concerning procurement of inputs. Audit was
conducted by the Respondent-Department for the period from
October, 2013 to October, 2014 and no suggestion for non-reversal
of CENVAT credit relating to meagre trading activity of 0.35% was
made in the Audit report dated 08.04.2015 but Appellant was issued
with show-cause notice suggesting denial of CENVAT credit of
Rs.1,46,11,468/- with interest and penalties on the allegation that
input services against those were not received at the factory of the
Appellant but at the EWH which had a separate registration, from
where trading was undertaken. In the Order-in-Original the said
proposals of show-cause notices were confirmed with interest and
equivalent penalty. The legality of such order is questioned before
this forum.
3. During the course of argument learned Counsel for the
Appellant submitted that such confirmation of denial of CENVAT
E/85601/2016
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credit with interest and penalty is erroneous, in view of various
decisions passed by this Tribunal including the decision reported in
2017 (52) STR 361 (Bom.) in the case of CCE, Aurangabad Vs.
Endurance Technology Pvt. Ltd. that was confirmed by the Hon'ble
High Court which in clear terms laid down that CCR Rules do not say
that input services received by a manufacturer must be received at
the factory premises, besides the facts that Appellant had reversed
CENVAT credit proportionate to trading activity in terms of Rule
6(3A) and no ineligible credit of input services was availed by the
Appellant. He further argued that against Order-in-Appeal passed by
the Commissioner of Central Tax (Appeals-I), Pune setting aside
another Order-in-Original dated 13.02.2017 for the period from
November, 2014 to March, 2016 holding that the entire input
services were natural input services used in relation to
manufacturing and eligible for CENVAT credit, no appeal had been
preferred by the Department and they had accepted the findings of
Order-in-Appeal on dated 23.03.2018. Further, for subsequent
period from April, 2016 to June, 2017 in the Order-in-Original passed
by the concern Additional Commissioner also demand that was raised
on dated 04.05.2018 was dropped, by following the above referred
Order-in-Appeal and after holding that upon reversal of CENVAT
credit proportionate to trading activity in terms of Rule 6(3A), no
ineligible credit of input services was availed by the Appellant and
the entire input services were natural input services used in relation
to manufacture of TCE and therefore CENVAT credit is admissible to
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the appellant. The subsequent Order-in-Original also was not
challenged by the Department and that attained finality. Learned
Counsel for the Appellant, with reference to judicial decision reported
in Vako Seals Private Limited Vs. CCE [2015 (40) STR 594 (Tri.-
Mumbai)], Raymond Limited Vs. CCE [2017 (47) STR 142 (Tri.-
Del.)], Adbur Private Limited Vs. CST [2017 (5) GSTL 334 (Tri.-
Del.)], Shrirarm General Insurance Company Limited Vs. CCE [ 2021
(44) GSTL 185 (Tri-Del.)] as well as basing on the findings of the
adjudicating authority and appellate authority for the subsequent
period prayed for setting aside of the order passed by the
Commissioner.
4. Learned Authorised Representative for the Respondent-
Department has argued in favour of the reasoning and rationality of
the order passed by the learned Commissioner (Appeals), while
acknowledging the finding in Order-in-Appeal and Order-in-Original
respectively for the subsequent period between November, 2014 and
June, 2017 concerning admissibility of CENVAT credits, against which
Department had not preferred appeal and accepted the findings.
5. We have perused the case record as well as relevant
documents annexed to it and found the contention is true. Further
basing on the decision reported in 2015 (40) STR 594 (Tribunal-
Mumbai.) in the case of Vako Seals Private Limited, Learned
Commissioner of Central Excise & Service Tax, Pune-I had allowed
E/85601/2016
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the appeal filed by the present appellant before him for the period
from November, 2014 to November, 2016. In following the judicial
precedent set by this Tribunal, we also pass the following order.
ORDER
6. The appeal is allowed and the order passed by the Commissioner of Central Excise & Service Tax, Pune-I in Order-in-
Original No. PUN-EXCUS-001-PR.COM-041-15-16 dated 07.12.2015 is hereby set aside.
(Pronounced in open court) (Dr. Suvendu Kumar Pati) Member (Judicial) (Sanjiv Srivastava) Member (Technical) Prasad