Custom, Excise & Service Tax Tribunal
M/S Salora International Limited vs Cce, Delhi Ii on 17 October, 2016
IN THE CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL West Block No. 2, R.K. Puram, New Delhi 110 066. Principal Bench, New Delhi COURT NO. I DATE OF HEARING : 17/10/2016. DATE OF DECISION : 17/10/2016. Excise Appeal No. 4099 of 2010 [Arising out of the Order-in-Appeal No. 570/CE/D-II/2010 dated 22/09/2010 passed by The Commissioner (Appeals), Customs & Central Excise, New Delhi.] M/s Salora International Limited Appellant Versus CCE, Delhi II Respondent
Appearance Shri Jitender Singh, Advocate for the appellant.
Shri Yogesh Agarwal, Authorized Representative (DR) for the Respondent.
CORAM : Honble Shri Justice Dr. Satish Chandra, President Honble Shri B. Ravichandran, Member (Technical) Final Order No. 54385/2016 Dated : 17/10/2016 Per. B. Ravichandran :-
The present appeal is against order dated 22/09/2010 of Commissioner (Appeals), Delhi II. The appellants are engaged in the manufacture of colour television sets liable to Central Excise duty and were also availing Cenvat credit. The dispute in the present appeal relates to duty payable on the various goods purchased from various supplies the credit on which was availed by the appellant. The appellants were paying duty on the inputs as per the prices mentioned in the invoices, but it was seen that the said amount is higher than the prices mentioned in the purchase orders. The appellants were issuing debit notes on account of difference in prices on which duty has been paid. The Department viewed that the appellants did not take correct amount of credit as the duty paid excess should be considered as a deposit in terms of Section 11D not eligible for credit under Rule 3 of Cenvat Credit Rules, 2004. Accordingly, proceedings were initiated which resulted in the original order dated 29/10/2009. The Original Authority confirmed duty demand of Rs. 41,97,338/- towards irregularity availed credit on such excess payment. Penalty of equivalent amount was also imposed. On appeal, the Commissioner (Appeals) vide the impugned order upheld the original order.
2. We have heard both the sides and perused the appeal records. We note that the Original Authority decided the case second time based on a remand direction of Commissioner (Appeals). The remand was to examine whether the debit notes issued by the appellant to the supplier of input resulted in any refund claim/sanctioned of differential duty at the suppliers end. It was observed by the Commissioner (Appeals) while remanding the matter that if no refund has been sanctioned at the suppliers end than the Cenvat credit taken by the appellant cannot be disturbed. We find that the Original Authority put the onus on the appellant to prove that the suppliers did not take any refund of duty as no confirmatory clarification was forthcoming. He proceeded to confirm the demand. We find that the reasoning given by the Original Authority is very strange and legally unsustainable. Admittedly, the appellants paid Central Excise duty on the inputs as per the invoices of the suppliers. It is also recorded that certain debit notes were issued later which resulted in the presumption that the duty actually payable on the inputs by the suppliers are lesser than what is paid by the appellant. Hence, the credit taken by the appellants was not legally correct. We find even the Commissioner (Appeals) erred in holding that the appellant did not submit proof that the suppliers did not take any refund. It was further recorded that even the enquiries made with the Jurisdictional Central Excise Authorities could not get proper response. Hence, the lower Authority proceeded to confirm the demand. We find that such confirmation is devoid of legal merit. When the payment of duty by the appellants has not been disputed and the Department entertained a view that there could be some possible refunds at the suppliers side, it is for the Department to verify the facts of the case at the suppliers end. It is not for the appellant to establish sanction or otherwise of any refund to the suppliers. We find that the lower Authorities misdirected themselves and passed legally unsustainable orders. Accordingly, the impugned order is set aside and the matter is remanded back to the Original Authority to verify the facts and pass fresh orders. If there is no evidence forthcoming regarding refund claim filed/sanctioned at the suppliers end, the Cenvat credit availed by the appellant cannot be denied or varied in the absence of any other grounds. Accordingly, the appeal is allowed by way of remand to the Original Authority.
(Operative part of the order pronounced in the open court.) (Justice Dr. Satish Chandra) President (B. Ravichandran) Member (Technical) PK ??
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4EX/4099 of 2010