Indian Kanoon - Search engine for Indian Law

3.1. It is his further submission that under Rule 3 of the CENVAT Credit Rules, 2004, the restrictions of availing CENVAT Credit is in respect of concessional rate of Central Excise Duty paid under Central Excise Tariff Notification No.1/2011-C.E. dated 01-03-2011 and under Sl.No.67 of Central Excise Notification No.12/2012-C.E dated 17-03-2012 as amended, which are procured from domestic manufacturer/producers and not in respect of Customs Tariff Notification No.12/2012-Cus dated 17- 03-2012 as amended on payment of concessional rate of CVD @ 2% adv on Coal imported from outside the territory of India/registered importers. Thus, the appellant's submission is that they have not erred in law by claiming CENVAT Credit of CVD paid on imported Coal; they have claimed concessional rate of CVD under Sl. No.123 of Customs Tariff Notification No.12/2012-Cus. dated 17-03-2012 as amended by Customs Tariff Notification No.12/2013-Cus.and not under any Excise Tariff Notification No.1/2011-C.E. dated 01-03-2011 and hence, the conditions of not claiming CENVAT Credit under proviso to Rule 3(1)(i) read with Rule 2(d) of the CENVAT Credit Rules, 2004 has no application to the instant case.

4.1. Accordingly, it is the contention of the appellant that the extended period of limitation cannot be invoked in this case; for the same reason, it is pleaded that the penalty imposed may also be set aside.

5. The Ld. Authorized Representative of the Revenue reiterated the findings in the impugned order.

6. Heard both sides and perused the appeal records.

7. We find that in this case, the appellant has imported Coal on payment of CVD at the concessional rate of 2% as provided under Entry Sl.No.123 of Customs Tariff Notification No.12/2012-Cus dated 17- 03-2012, as amended by Notification No.12/2013- Cus. Dated 01-03-2013. The appellant has availed the credit of the CVD paid on the imported coal. The department proposed to deny the credit on the ground that Rule 3 of the CENVAT Credit Rules, 2004, imposes restrictions on availment of CENVAT Credit is in respect of concessional rate of Central Excise Duty paid under Central Excise Tariff Notification No.1/2011-C.E. dated 01-03-2011 and under Sl.No.67 of Central Excise Notification No.12/2012- Appeal No.: E/75011/2021-DB C.E dated 17-03-2012, as amended. In this regard, we observe that the said restriction is applicable only when coal is procured from domestic manufacturer/producers and not in respect of imported coal by availing the concessional rate of CVD in terms of Customs Tariff Notification No.12/2012- Cus dated 17-03-2012, as amended, as has been claimed by the appellant in this case. In these facts and circumstances, we hold that the appellant have not erred in law while claiming CENVAT Credit of CVD paid on imported Coal. Thus, the conditions of not claiming CENVAT Credit under proviso to Rule 3(1)(i) read with Rule 2(d) of the CENVAT Credit Rules, 2004 has no application to the instant case.

18. The same view was taken by the Tribunal in Asahi Songwon Colors and the relevant paragraph is reproduced below "From the above Rule, it is observed that even if any duty is paid by availing exemption Notification No. 12.2012-CE dated 17.03.2012, the same will not be available as Cenvat credit for the user of the goods. In the present case, admittedly, the appellant have Imported Coal and CVD of 2% is leviable in terms of Customs Notification No. 12/2012- Cus. There is no restriction provided in Rule 3 as regards duty paid under Customs notification. This restriction is applicable only in case of indigenous goods on which the excise duty 2% was paid availing Notification No. 12/2012-CE, which is not a case here. Therefore, the appellant is entitled for Cenvat credit in respect of CVD paid under Notification No. 12/2012-Cus. Moreover, since the Notification No. 12/2012-CE is applicable only in respect of indigenously Appeal No.: E/75011/2021-DB manufactured coal and not in respect the imported coal as held by the Hon'ble Supreme Court in the case SRF Limited vs CC, Chennai- 2015 (318) ELT 607 (SC) Therefore, even if the importer wants to avail the exemption of Notification No. 12/2012-CE for payment of CVD, the same will not be available to the importer. Therefore, in any case, in the case of import the Notification No. 12/2012-CE is not relevant

22. The Commissioner, therefore, committed an illegality in denying the benefit of CENVAT credit to Hindustan Zinc."

7.3. A similar issue also came up for consideration before the Tribunal in the case of Commissioner of Central Excise and Customs, Jaipur-I Vs. M/s. Shree Cement Ltd. reported in 2022-VIL-547-CESTAT-DEL- CE, wherein it has been observed as under: -

"6. We have heard learned Authorised Representative appeared for Revenue and learned Counsel for respective assessee/respondents and perused the case records including the written submissions alongwith the case laws placed on record. The assessee herein have availed Cenvat credit, in respect of 1%/2% CVD paid as per Notification No. 12/2012-Cus. The specific bar on which the Revenue is harping upon is provided under Rule 3 (1) (1) (a) (b) ibid for availing Cenvat credit in respect of goods exempted from payment of excise duty under Notification No. 1/2011-CE and 12/2012-CE but in our view, there is no such bar in respect of CVD paid under Customs Notification No.12/2012-Cus, therefore the assessee/respondents are eligible for Cenvat credit in respect of 1% or 2% CVD, as the case may be, paid under Notification No. 12/2012-Cus. Otherwise also, the issue involved in these appeals is no more res integra and is covered in favour of assessee in view of various decisions of this Tribunal on the identical issue. Recently in Excise Appeal No. 52928 of 2019 titled as M/s Hindustan Zing (sic) Ltd vs. Commissioner, CGST, on similar facts the Tribunal vide final order по. 50855-50856/2020 dated 28/09/2020 2020-VIL-472-CESTAT-DEL-CE held that the manufacturing company was justified in taking the Cenvat credit. The relevant paragraphs of the aforesaid decision is extracted as under:-