Madhya Pradesh High Court
Commissioner Customs And Central ... vs M/S Uflex Limited L1 on 28 June, 2017
CEA.No.1/2017
28.06.2017
None appears for the parties when the matter is called
out - presumably in terms of the resolution of the High Court
Bar Association dated 28.06.2017 for abstaining from Court
work.
The present appeal is filed claiming that the following
substantial questions of law arising out of order passed on
17.10.2016 by the Customs, Excise and Service Tax Appellate
Tribunal (for Short "the Tribunal").
"1. Whether the learned CESTAT was just in
holding that the said goods manufactured on job
work basis on which no duty was paid by the
respondent are not exempted goods and
accordingly holding that the provisions of Rule 6(1) of the Cenvat Credit Rules are not applicable?
2. Whether in the facts and circumstaces of the case, the learned CESTAT has rightly considered the scheme of CENVET Credit Rules, 2004 and its allied provisions?
3. Whether the order of the learned CESTAT is correct and facts and provisions of law?
4. Whether in the facts and circumstances of the case, the order passed by the learned CESTAT is justified and in accordance with the principles of jurisprudence?
5. Whether in the facts and circumstances of the case, the learned CESTAT has rightly considered the effect of variour judicial pronouncement and government circulars in the factual matrix of the present case?"
The said order arises out of the fact that the assessee manufacture goods on job work on which excise duty is payable as also goods which are exempted from excise duty under notification No.214/86. The assessee takes credit on raw materials used in the manufacture of polyester chips as also on input services. One item of such input service is service of goods Transport Agency for transporting the polyester chips to the factory of their principal. The period of dispute is January. 2007 to July, 2008.
The Additional Commissioner of Customs confirmed the duty demanded for an aggregate amount of Rs. 24,41,571/- and also imposed 100% penalty under Rule 15 of the Cenvat Credit Rules. The appeal against the said order of assessment was dismissed by Commissioner (Appeals) on 12.08.2010. It was in further appeal, the Tribunal accepted the appeal and set-aside the demand in respect of credit of outward transportation, and that the matter was remanded back in view of the amendment carried out in the definition of "Input Services". The Tribunal relied upon the judgment of Larger Bench in Sterlite Industries (I) Ltd. vs. CCE (2005) (183) ELT 353. The Tribunal recorded the following findings :
"After considering the arguments of both the sides I find that as regards the first issue of availment of Cenvat Credit in respect of various input services the appellant authority has observed that issue in Larger Bench decision in the case of Sterlite Industries (I) Ltd. (supra) was relatable to credit availability of inputs and as such the same would not be applicable in respect of credit availability of input services. The said distinction made by the authority for not applying the ratio of larger bench decision of the Tribunal cannot be appreciated. There is no difference between the inputs and input services credit and the issue being the same i.e. clearance of goods for job work in terms of notification number 214/86-CE, the denial of credit, whether it be on inputs or on input services, cannot be upheld. It is the ratio of the law declared by the Larger Bench which is required to be made applicable."
We do not find any error in the said findings recorded by the Tribunal which is based upon Larger Bench judgment of Tribunal in Sterlite Industries (I) Ltd. (supra). The Tribunal has rightly found that there is no difference between 'input' and 'input services' credit as the issue is same in clear terms of notification No.214/86, therefore, denial of credit cannot be upheld.
We find that the findings recorded by the Tribunal are the finding of facts. Therefore, we do not find any substantial question of law for consideration. The Appeal is, therefore, dismissed.
(Hemant Gupta) (Sanjay Yadav)
Chief Justice Judge
anand