CESTAT RULING (CENTRAL EXCISE) · 2018. 10. 2. · Hritik Exim Vs CCE (D ated: October 26, 2016) CX - Refund - The assessee has not paid ST on sales commission agents service for

CESTAT RULING (CENTRAL EXCISE)

2017-TIOL-1257-CESTAT-DEL

Kakda Rolling Mills Vs CCE & ST (Dated: July 7, 2015)

CX - Whether assessee is eligible to take cenvat credit on disputed goods by treatingthe same as components accessories and parts of capital goods falling under Chapter84 of CETA and whether SCN issued in 2012 covering the period from August 2007 toAugust 2009 is barred by limitation of time - Assessee had purchased old and usedsteel plant with its furnace in year 2007 and to make it workable, disputed goods havebeen used for construction/ erection of rolling platform, penal track material,supporting stand, storage, platform and for repairing of old and used parts - Disputedgoods merit consideration as inputs for purpose of taking cenvat credit - Sinceactivities of assessee were within the knowledge of Department, SCN issued byinvoking extended period of limitation, is not maintainable: CESTAT

2017-TIOL-1256-CESTAT-HYD

Hritik Exim Vs CCE (Dated: October 26, 2016)

CX - Refund - The assessee has not paid ST on sales commission agents service forselling the export goods - Department viewed that ST is to be levied under concept ofreverse charge mechanism - Assessee exports the finished goods - The CHA serviceas well as commission agent service can be undoubtedly said to be services which areavailed and utilized by assessee for export of finished products - Therefore, no logicfound on the part of department to deny credit stating that these services have nonexus with goods exported - Status of assessee whether it is a proprietorship orpartnership, 100% EOU are not criteria for rejection of refund: CESTAT

2017-TIOL-1254-CESTAT-CHD

Hi-Tech Engineers Vs CCE (Dated: January 31, 2017)

CX - Assessee involved in fabrication of certain items which are mounted on electricpoles, by way of cutting, drilling, punching holes & bending/welding - Departmentalleged that these processes amounts to manufacture and imposed duty with interest& penalty upon assessee - Held - Relying on decision in Deepak Galvanising & Engg.Indus. Pvt. Ltd , activity of cutting, bending/drilling, punching holes does not amountsto manufacture - However in consideration of decision in Mahindra & Mahindra Ltd. -2005-TIOL-1215-CESTAT-DEL-LB , activities involving welding are dutiable - Henceduty demand be requantified in consideration of the above: CESTAT (Para2,7,8,13,14)


Shree Jee Laminators Vs CCE (Dated: March 6, 2017)

CX – Whether the process of lamination of HDPE woven fabrics by LDPE amounts tomanufacture and whether laminated HDPE woven fabrics is a new distinct product orotherwise - adjudicating authority did not agree with the contention raised by theappellant and confirmed demands raised with interest and also imposed penalties;adjudicating authority also confiscated the unaccounted laminated HDPE fabrics byextending the option to redeem the same on payment of redemption fine – appeal toCESTAT. HELD: As per section 2(f)(i) of the Central Excise Act, 1944, manufactureincludes any process which is incidental or ancillary to the completion of amanufacture product – the Bench is not concerned with the definition of ‘manufacture'

in section 2(f)(ii) and 2(f)(iii) – in the case in hand, there is no process which hasbeen undertaken by the appellant which is incidental or ancillary to the completion ofmanufactured product as HDPE fabrics coated with LDPE remains laminated wovenHDPE fabrics – in the case of Pitamber Coated Paper Ltd. - 2015-TIOL-71-SC-CX ,similar issue came up before the apex court as to whether coating of uncoated writingand printing paper amounts to manufacture or otherwise and the appeals of revenuewere dismissed – in the case of Maruti Suzuki India Ltd. - 2015-TIOL-30-SC-CX , theapex court held that electro deposition of coating/anti-rust treatment on motorvehicles does not convert these parts into new commodity known to the market andthese parts are of commercial use in themselves – hence it was held that suchtreatment does not amount to manufacture – in the case of Gujarat Steel Tubes Ltd. -2002-TIOL-503-SC-CT-LB , the apex court has held that galvanisation of steel tubesdoes not amount to manufacture, which is more or less identical to the issue in hand -following the ratio of the above decisions of the apex court, the Bench holds thatlaminated HDPE fabrics that comes into existence due to the process of laminationcannot be held as a manufactured product attracting central excise duty – impugnedorder set aside and appeals allowed: CESTAT [para 10, 11, 12, 13, 16, 17]

2017-TIOL-1246-CESTAT-MUM

Niraj Gyanchand Jain Vs CCE (Dated: March 22, 2017)

CX – Section 35F of the CEA, 1944 - Jurisdictional High Court has considered the issuein hand raised by the applicant in the case of Nimbus Communications Ltd. - 2016-TIOL-1708-HC-MUM-ST, therefore, Bench need not visit the various judgments citedby the applicant, as jurisdiction High Court judgment is binding on the Tribunal -Mandatory pre-deposit is applicable even in those cases where the proceedings havebeen initiated prior to enactment – Bench informed applicant that if they are ready todeposit 7.5%, a reasonable time can be given, however, the answer of counsel forapplicant was in negative, therefore the appeal is not maintainable for want of pre-deposit in terms of Section 35F - appeal is dismissed - consequently, application forstay and condonation of delay are also dismissed as infructuous: CESTAT [para 5 to 8]

Also see analysis of the order


CCE Vs JCBL Ltd (Dated: January 19, 2017)

CX - Assessee engaged in manufacture of motor vehicle bodies using duty paidchassis - Chassis is supplied by independent owners who purchase them frommanufacturers upon payment of duty & also avail exemption on such motor bodies -Assessee availed exemption on motor vehicles fabricated for independent chassisowners under Notfn. No. 06/2002, under a condition that vehicle should bemanufactured from chassis on which duty was paid & no credit was availed - Thoughassessee did not avail credit of duty paid on chassis received from customer but hadavailed credit on other inputs used in manufacture - On this ground exemption wasdenied to assessee - Duty demand with interest liable to be upheld since assessee didnot reverse 8% of value of exempted goods & has violated Rule 6(3)(b) of CCR -However difference of opinion arises as to imposition of penalty as bench differs uponmens rea of assessee to evade duty - Said difference to be resolved by Third memberopinion: CESTAT (Para 2,6,10.5,12)

2017-TIOL-1244-CESTAT-MAD

Hinduja Foundries Ltd Vs CCE (Dated: December 7, 2016)

CX - Assessee availed cenvat credit on input services - lower authority allowed credittowards security service and denied credit on other input services amounting due toineligibilty of services under Rule 2(l) - Commissioner (A) allowed further partlyavailment of credit amount - Penalty reduced - All services are eligible input services -However, in respect of services of Construction of Overhead tank, Capital Civil SundryWork and Labour charges for fabrication and erection of DSL, the nature of servicesare related to construction or execution of works contract or civil structure or partthereof and such services would not qualify as an eligible input service - Matterremanded in respect of transport and loading charges as these services relate not onlyto transportation and loading charges incurred with respect to raw material but alsosemi-processed as well as final products - It is clarified that de novo consideration willonly to with respect to verifying individual break up of the transport and loadingcharges of various accounts and also determining the eligibility thereof for thepurpose of Rule 2(l) taking into account the statutory provision : CESTAT

2017-TIOL-1243-CESTAT-AHM

Maniar And Company Shafee Maniar Vs CCE (Dated: January 24, 2017)

CX - Assessee was a manufacturer of auto body building and received duty paidchassis from their customer on which they mount body/fabricated structures/equipment as per requirement of customer - As per Notf 8/2003 and 6/2002, thevalue of chassis supplied by their customer was to be excluded from the aggregatevalue of clearance as they were eligible as per SSI exemption - Revenue did not giveany acceptable reason for denying cum-duty benefit to assessee - Assessee alsoclaimed Cenvat credit on inputs used in manufacture of goods - There cannot be twoopinions on entitlement of CENVAT credit utilsed for manufacturing of goods byassessee - Matter remanded: CESTAT (Para 2,6,7)


JCT Ltd Vs CCE (Dated: December 20, 2016)

CX - Assessee received extra consideration on account of travel insurance which wasadded in assessable value, following which duty demand with interest & penalty wasimposed - Held - Considering a previous judgment on identical issue and involving thesame assessee, it is held that duty demand with interest & penalty is imposable asamount in question was received over and above the regular insurance charges:CESTAT (Para 2,4,5)


CCE Vs Jindal Fibres Pvt Ltd (Dated: October 18, 2016)

CX - Assessee engaged in manufacture of carpet and cleared the same and its wasteclassifying under sub heading 5703.20 at nil rate of duty - Demand was confirmedclassifying their products under sub heading 5703.90 in view of the sub heading note2(B) (ii) of Section XI of CEA, 1985 - Goods in question do not consist of a groundfabric and a pile or looped surface which is essential condition to specify the product inthe sub heading note 2(B) of Section XI of ACt, 1985 - In absence of such evidencesub heading note 2 (B) Section XI of Act, 1985 is not applicable to the facts of thiscase - No infirmity found in impugned order and same is upheld: CESTAT


Honda Motorcycle And Scooter India Pvt Ltd Vs CCE (Dated: February 6,2017)

Central Excise - Cenvat Credit - The assessee engaged in the manufacture of twowheelers and availed cenvat credit on inputs and capital goods used in themanufacture of their final product - During the verification of records, it was asked tofurnish the inputs stock variation report - Report showed the difference between thestock of inputs as reflected in the records and the physical stock of inputs lying in thefactory - The department viewed that the inputs found short were not used in orrelation to the manufacturer of final products, therefore, the cenvat credit of the dutypaid on such goods is not admissible to the assessee - There is shortage of minorquantities i.e. 0.23%/ 0.22% of the total inputs which is within permissible limit,therefore the cenvat credit cannot be denied to the assessee - The impugned order isset aside : CESTAT


Avon Cycle Ltd Vs CCE (Dated: February 3, 2017)

CX - Assessee engaged in manufacture and also import of e-bikes - They paid 10% ofvalue on e-bikes even though they were exempted from duty after 29.4.08 - Assesseereasoned that they manufactured e-bike parts too which were dutiable & also thatassessee had not been maintaining separate accounts of inputs used in dutiable aswell as exempted final products - Revenue opined that since e-bikes were exempt,assessee had no tax liability and thereby, assessee's unused cenvat credit was liableto lapse - Further duty demand with interest & penalty was imposed for e-bikescleared after 29.4.08 - Held - Since assessee is manufacturing both exempt & dutiablee-bikes and uses inputs to manufacture e-bikes & parts thereof and is reversing 10%of value of e-bikes, assessee's credit will not wholly lapse - Only credit w.r.t. finishede-bikes & work in progress will lapse: CESTAT (Para 2,8,10)


CC, CE Vs Balaji Steel Industries (Dated: October 14, 2016)

Central Excise - Parties to the appeal - the show cause notice was issued to fivepersons ie. two firms and 3 individuals - After adjudication the original authority hadconfirmed the demand against all the five persons, whereas the Commissioner(Appeals) set aside the impugned order and thereby set aside the demand, interestand penalty raised against all five persons - Aggrieved, Revenue filed appeal againstonly one person that ie. M/s Balaji Steel Industries, Visakhapatnam, and the otherfour persons are not impleaded as respondents - Preliminary objection was raised onthe ground that although the department has challenged the setting aside ofimpugned order dropping of demand against all five persons, they have failed toimplead all the parties in the appeal.

Held: Commissioner, Visakhapatnam, in response to the defect, communicated thatthe other persons need not be impleaded in the appeal because as per Rule 6(2) ofCESTAT Procedure Rules, a single appeal has to be filed by each aggrieved person andthe department being the aggrieved person, only one appeal to be filed - This indeedis wrong perception of Rule 6 (2) of the Procedure Rules - the said rule does notrelieve the appellant from impleading all the respondents /necessary parties to theappeal - Though the defect was pointed out, the department has not taken anyinterest to rectify the defect even after granting adjournment; and the report filed bythe Commissioner, Visakhapatnam shows that they have no intention to rectify thedefect - As necessary parties are not impleaded and the appeal is filed only againstone person, although in the appeal grounds the prayer is to set aside the order passedagainst all five persons, the appeal is not maintainable due to the defect of notimpleading necessary parties/respondents. [Para 3, 4]


CCE Vs Basant Mechanicals Works (Dated: October 27, 2016)

CX - In SCN, there was proposal to deny credit to the tune of Rs.5,23,757/- whereasRevenue is seeking to deny credit of Rs.23,85,552/- which is beyond the scope of SCN- Therefore, demand of Rs.23,85,552/- is not sustainable - Availemnt of SSIexemption by assessee and reversal of credit was in knowledge of department,therefore, SCN is time barred: CESTAT


India Tube Mills And Metal Industries Vs CCE (Dated: March 22, 2017)

CX – Valuation – Section 4 of CEA, 1944 - Revenue has not disputed the value ofRs.42 lakhs for each LPG bullet, however, demand raised only on inclusion of thevalue in respect of bought out items and certain activities taking place at the site forerection and installation of the said LPG bullets - bought out items are undisputedlysupplied to the site by suppliers' and do not take part in the manufacture of LPGBullets - These bought out items are used only for erection and installation of LPGBullets at site and such activity, in our considered view, is not amounting tomanufacture - Moreover, after erection and installation of the LPG Bullets, it becameimmovable goods - If at all any activity by any imagination amounts to manufacture,by virtue of immovability of LPG Bullets, the activities at site cannot be charged toexcise duty – demand does not sustain – impugned order set aside and appealallowed: CESTAT [para 4, 5]



CCE Vs Central India Polyesters Ltd (Dated: January 6, 2017)

CX – Revenue in appeal against order of Commissioner(A) allowing credit of NCCD fordischarge of duty on POY. Held: It is seen that credit of NCCD has been used fordischarge of NCCD on POY and it is not clear as to what utilization of NCCD has beenheld improper - ground of appeal does not clearly specify as to which Rule has beenviolated while utilizing the credit of NCCD, thus, it is vague – Revenue appeal is,therefore, dismissed: CESTAT [para 5 to 7]


Bhagwati Kripa Paper Mills Pvt Ltd Vs CCE & ST (Dated: November 24, 2016)

CX - Assesee engaged in manufacture of Kraft paper & use waste paper as a rawmaterial - Assessee maintained separate accounts for raw materials & final product -Revenue alleged that waste material reflected in accounts had been clandestinelyremoved - Revenue unable to produce relevent document to prove its allegations -Trimming and cutting of waste produced during manufacturing is not marketable andthey are re-fed for futher process of manufacture therefore not dutiable - Impugnedorder set-aside: CESTAT (Para 1,2,4,5)


CCE Vs Rohit Surfactant Pvt Ltd (Dated: February 2, 2017)

CX – CENVAT - Whether the respondent is entitled to avail Cenvat Credit on servicetax paid on outward transportation of their final product which is being sold by themon FOR Basis. Held: Issue is no more res integra - Apart from being covered by thePunjab & Haryana High Court's decision - 2009-TIOL-110-HC-P&H-ST , it is also seenthat Larger Bench of the Tribunal in the case of ABB Ltd. Vs. CCE Bangalore - 2009-TIOL-830-CESTAT-BANG-LB which stands confirmed by the High Court of Karnataka -2011-TIOL-395-HC-KAR-ST has held such credit to be admissible – no reason tointefere with the order of Commissioner(A), hence Revenue appeal rejected: CESTAT[para 2, 3]


Simplex Packaging Ltd Vs CCE (Dated: August 4, 2016)

CX - Assessee engaged in manufacture of Printed Plastic Laminates, other LaminatedPlastic Pouches and Printed Polypeline Labels - Goods are dutiable and assesseeavailed cenvat credit on inputs used - Revenue alleged that Printed Plastic Laminateswas a by-product and not a final product, thereby exempted from duty and that theassessee wrongly availed credit on this item - Assessee was asked to reverse 10% oftotal price of final product - Held: Printed Plastic Laminates do not fall under the list ofexempted goods prescribed under Rule 6 of CCR - Hence, assessee cannot be askedto pay anything: CESTAT (Para1,2,5)


JCB India Ltd Vs CCE (Dated: December 21, 2016)

CX - Assessee cleared construction related machines for a project & claimedexemption under Notfn. No. 108/95-CE - Assessee had supplied machines directly tothe contractors rather than to the Project Implementing Authority & the machinesremained with contractors upon completion of project - Revenue sought to denyexemption on this ground imposed duty demand with interest & penalty - Held -Revenue has gone beyond its jurisdiction by holding in SCN that machines in questionwere not supplied to the project - From a reading of Notfn 108/95, it is clear that theassessee supplied goods financed by an agency affiliated to the United Nations & saidproject was approved by Central Govt. - Moreover, assessee has a certificate issuedby Project Authority proving assessee's eligibility to claim exemption & has satisfied allconditions - Hence assessee eligible to calim exemption under Notfn. No. 108/95:CESTAT (Para 2,7,8,10,11)


Covalent Laboratories Pvt Ltd Vs CC, CE & ST (Dated: November 7, 2016)

Central Excise – Confiscation – Clandestine Removal – When goods were provisionallyreleased and cleared on payment of duty determined and when the goods were notphysically available for confiscation, order of confiscation and imposition ofredemption fine is not legal. In respect of stock found in excess of daily stock account,when goods were lying in the factory, mere non-entry in the RG-1 register cannot beconsidered as non-accounting and cannot be said as violation of Rule 10 and so nopenalty can be imposed. However, statements recorded to the effect that appellantwas indulging in clandestine removal, together with the admitted fact that stock inexcess in respect of some items was not accounted in the RG-1 register, would attractprovisions u/r. 26 and a mere penalty of Rs. 1 lakh is sufficient. (paras 9,10 & 11)


Bharat Heavy Electricals Ltd Vs CCE (Dated: November 25, 2016)

Central Excise – CENVAT Credit – Inspection carried out and credit availed of tax paidon the service denied in adjudication; and demands upheld by Commissioner(Appeals) – However, the denial and reversal of credit is not contested, only theinterest and penalty is agitated herein.

Held: The issue in question is no longer res integra and has been settled by a numberof High Court decisions including that of Billforge Pvt. Ltd., subsequently followed inseveral rulings - following the maxim of stare decisis and the ratio set down in theBillforge decision, no interest liability will arise in the present case also and,consequently, there cannot be any imposition of penalty – no interference in thedenial / reversal of credit. [Para 4]

2017-TIOL-1220-CESTAT-BANG

Apotex Pharmachem India Pvt Ltd Vs CCE, C & ST (Dated: January 30, 2017)

CX - Assessee, 100% EOU, engaged in manufacture of pharmaceutical products -Assessee sought refund of unutilized cenvat credit u/r 5 of CCR, achieved throughexports made over several periods - Refund w.r.t several input services, cleaning(housekeeping service); garden maintenance; industrial wastage managementservice; management, maintenance or repair service; management businessconsultancy service (consultation of quality control); manpower recruitment agencyservice; repair and service maintenance (software maintenance) and projectmanagement consultancy for alleged lack of nexus with final export - Held - Disputedservices clearly fall within the scope & ambit of 'input service' for claiming cenvatcredit - Refund to be sanctioned: CESTAT (Para 2,2.1,2.2,5)


Apotex Research Pvt Ltd Vs CCE, C & ST (Dated: January 30, 2017)

CX - Assessee a 100% EOU engaged in manufacture of pharmaceuticals - Assesseeclaimed refund of unused cenvat credit u/r 5 of CCR - Revenue alleged that the claimspertaining to one period was time barred - Held - Following decisions of the MadrasHigh Court and in consideration of the facts & arguments, matter remanded back tooriginal authority to re-calculate amount of refund hit by limitation: CESTAT (Para2,6)


Hindustan Petroleum Corporation Ltd Vs CCE & ST (Dated: February 3, 2017)

CX - The assessee receives petroleum products from various refineries - Said productswere assessed to duty based on transaction value - However, assessee continued toadopt APM price in respect of goods cleared to other Oil Manufacturing Companies(OMCs) and paid duty on APM price - The APM price so adopted was higher than theRefinery Transfer Price (RTP) and hence, assessee filed a refund claim afterreconciling their account - The Assistant Commissioner rejected the amount as timebarred and credit the balance amount to Consumer Welfare Fund on the ground thatthe assessee has not established that the incidence of duty has not been passed on toultimate consumers - In view of judgment of apex court in Addison and Company Ltd.2016-TIOL-146-SC-CX-LB , the present case needs to be remanded back to originalauthority to determine whether the principle of unjust enrichment is applicable or not:CESTAT


Apotex Research Pvt Ltd Vs CCE, C & ST (Dated: January 30, 2017)

CX - Assessee a 100% EOU engaged in manufacture of pharmaceuticals - Assesseesought refund of accumulated unused cenvat credit u/r 5 of CCR - Revenue partiallyrejected refund claim for Management; Maintenance & Repair Service; ManpowerRecruitment or Supply Agency; Renting of Immovable property service; Securityservice; software maintenance; technical testing & analysis service; professionalcharges; commercial training and coaching; erection, commissioning and installationservice; & cleaning service for want of nexus with manufacture of final product - Held- In light of the submissions & the judgments cited, impugned orders rejecting refundare set aside: CESTAT (Para 2,6)


Arkema Peroxides India Pvt Ltd Vs CCE & ST (Dated: December 5, 2016)

Central Excise - Eligibility of Cenvat Credit on outward transportation – Originalauthority disallowed the same and demanded an amount under Rule 14 of CenvatCredit Rules, 2004 along with interest and equal penalty under Rule 15(2) of theCenvat Credit Rules, 2004 – On appeal, Commissioner (A) upheld the OIO andrejected the same.

Held: Matter remanded to the original authority to reconsider the matter based on theguidelines contained in the Board's Circular No. 97/8/2007 – Appeal disposed – (Para4).


Ganapathi Power Industries Vs CC, CE & ST (Dated: October 31, 2016)

Central Excise – Demand - Appellants are engaged in manufacture of transformers – Adepartmental intervention occurred and it was observed that appellants have clearedtransformers during the material period and had collected Central Excise duty, butfailed to credit the same to the exchequer - Demands under Section 11D (2) ofCentral Excise Act 1994 with interest and penalties under Rules 25 and 27 of theCentral Excise Rules 2002 adjudicated, primary demands (duty + interest) upheld byCommissioner (Appeals), who set aside penalty; now agitated herein.

Held: The appellant do not dispute the duty liability, but request that they have paid apart in cash, and may be permitted to adjust the balance amount from the CENVATCredit account - This is refuted by the department by contending that the appellantsbeing an SSI unit at the time of issuing invoices cannot now turn around and claimadjustment of duty from the CENVAT account - there is no evidence to establish thatthe appellant filled any declaration with the department as an SSI unit - Thedepartment has only relied upon the statement in reply to notice in which theappellant has stated that they intend to manufacture as an SSI unit and therefore,they did not obtain registration - They had no filed any declaration as required by law,before the department stating that they intended to manufacture as SSI unit;therefore there is no legal ground to deny adjustment in CENVAT account for paymentof the demand confirmed in the impugned order - the appellant has stoppedmanufacture and the credit remains unutilized, also there is no further scope for theutilization - However the invoices have to be verified whether the credit is admissibleor not, and for that limited purpose of verification, the matter is remanded to theadjudicating authority - the duty demand is upheld; the appellant is entitled to adjustthe payment of balance amount through their CENVAT account; and the matter is

remanded to the adjudicating authority for the limited purpose of verification of theinvoices. [Para 7, 8]


Fujikawa Power Vs CCE & ST (Dated: December 29, 2016)

CX - Assessee engaged in manufacture of Grey Oxide, Red Lead, lead Plates andBatteries availing exemption under Notfn. No. 50/2003-CE - Proceedings wereinitiated against assessee when it was found that assessee was also manufacturingRed Oxide, after which duty demand with interest and penalty was imposed, by wayof extended period of limitation - Held - After examining the manufacture process, itemerges that red Oxide is produced as a by-product of the manufacturing process -Thereby, it cannot be alleged that assessee had exclusively produced Red Oxide orconcealed its production - Therefore, assessee is eligible to receive benefit of Notfn.No. 50/2003-CE: CESTAT (Para 2,8,9)

2017-TIOL-1206-CESTAT-ALL

Triveni Glass Ltd Vs CCE (Dated: August 29, 2016)

CX - Assessee were manufacturing sheet glass and started installation of machineryfor manufacture of float glass within same factory - From May, 1995 onward, theytook Modvat Credit of duty paid on capital goods received in their factory forinstallation of manufacture of float glass under Rule 57Q of CER, 1944 - Revenueviews that till the manufacture of float glass does not start, Modvat Credit of duty paidon capital goods brought into factory for installation for manufacture of float glass wasnot admissible to assessee - Said issue has been clarified by C.B.E.C. circular dated02-12-1996, wherein it has been clarified that for capital goods procured and receivedinto factory prior to 01-01-1996, credit of specified duty availed and utilizedimmediately will be admissible even if such goods were not actually brought intoproduction of excisable goods on date of such availment and utilization: CESTAT


Alembic Ltd Vs CCE (Dated: December 30, 2016)

CX - Assessee had made an application for fixation of brand rate of duty drawbackwhich was rejected on the ground that application filed is beyond the normal period of60 days from the let export date - In view of differing decisions of Tribunal inentertaining the appeals pertaining to drawback matters, issue is placed beforePresident for referring it to Larger Bench to decide the question of law that whetherthe appeals pertaining to payment of drawback as provided in Chapter - X of CustomsAct, 1962 and rules made thereunder including those for condonation of delay insubmitting brand rate applications are maintainable before Appellate Tribunal underCEA, 1944: CESTAT


Central India Polyesters Ltd Vs CC & CE (Dated: March 17, 2017)

CX – Refund, Interest – Section 11B, 11BB of CEA, 1944 – Only when the appeal is

finally allowed by the Tribunal, in such case, amount is refundable within a period ofthree months – since the matter was remanded for re-quantification of demand,refund will arise only after finalization of the re-quantification of demand by theCommissioner – as the demand was very much existing, it cannot be said that therehas been a delay in granting refund of pre-deposit – claim of interest is untenable –impugned order has no infirmity - appeal is dismissed: CESTAT [para 5]



Andhra Pradesh Paper Mills Pvt Ltd Vs CCE (Dated: October 20, 2016)

Central Excise – Refund - Appellants are engaged in the manufacture of paper andpaper boards - they paid duty on Sub-Standard Kraft Paper mistakenly which wasconsumed captively in the manufacture of final products, in ignorance of NotificationNo. 217/86-CE dated 01.03.1986 - Since duty was paid provisionally under protest,the appellant subsequently filed refund claim – A part of the claim was rejected astime barred and agitated before Commissioner (Appeals), who granted only partialrelief - The Tribunal remanded the matter to the original authority for considering theaspect of unjust enrichment in the light of judgment of Mafatlal Industries caserendered by the Apex Court – The original authority ordered refund to be credited toConsumer Welfare Fund - Commissioner (Appeals) upheld it but the Tribunalremanded back the case to the Original Authority to finalise assessment and decidethe issue in terms of CCE, Chennai Vs TVS Suzuki Ltd. - the Adjudicating Authorityfinalized the assessment for the period March 1987 to February 1992, demandeddifferential duty and ordered the sanctioned refund to be transferred to the ConsumerWelfare Fund - Commissioner (Appeals), upheld the same, culminating in this thirdround of litigation.

Held: The issue whether unjust enrichment will be applicable to the refund of the dutyfinalized after 25.06.1999 but pertaining to the period prior to 25.06.1999 was held tobe in favour of the assessee by the Larger Bench of Tribunal in the case of PanasonicBattery India Company Limited - following the ratio, the refund cannot be credited tothe Consumer Welfare Fund enrichment; the impugned order is set aside and theappellant is eligible for sanction of refund. [Para 6]


Andhra Sugars Ltd Vs CC, CE & ST (Dated: January 5, 2017)

CX - Assessee engaged in manufacture of sugar & molasses & availed credit oncement as capital goods used for foundation/construction works - SCN imposing dutydemand with interest & penalty were issued, alleging irregular availment as cement isneither input nor capital goods - Held - Majority of the credit amount availed pertainsto period prior to 07.07.2009 - It was only post 07.07.2009 that cement was excludedfrom the scope & ambit of 'inputs' for claiming cenvat credit - Thereby, penaltysustained for only that credit as availed after 07.07.2009 while demand, interest &penalty on credit availed prior to 07.07.2009 set aside - Penalty amount to berequantified accordingly: CESTAT (Para 2,6)


Aurobindo Pharma Ltd Vs CCE & ST (Dated: January 12, 2017)

CX - Assessee engaged in manufacture of both exempted as well as dutiable bulk

drugs & formulations & were availing cenvat credit on the inputs/capital goods used -Assessee did not maintain separate accounts for input services - SCN imposing dutydemand with interest & penalty was imposed - Period of dispute is prior to 01/04/08wherein an amendment to the Finance Act 1994 enabled assessees to reverse thecredit attributable to the inputs/input services used in the manufacture of exemptedgoods within a period of 6 months - Although the assessee did not file an applicationopting to reverse the credit, instead even prior to this amendment, the assessee hadreversed the credit - Assessee produced the Chartered Accountant certificate tosubstantiate the same - This fact was not considered by the Commr.(A) although itwas availble on record - Therefore, even where an assessee does not file anapplication opting for reversal of the credit, the alternative method of paying 10%cannot be forced upon the assessee - Hence duty demand with interest & penalty setaside: CESTAT (Para 1,4,5)


CCE & ST Vs Bhavani Ceramic Pvt Ltd (Dated: March 6, 2017)

CX - Assessee manufacture Sodium Silicate - Revenue alleged a shortage of finishedgoods, following which assessee debited entire amount of duty - Subsequebtly,revenue proposed appropriating the duty amount already paid and imposed penalty &interest - Commr.(A) rejected revenue's contention that production of goods wassupressed & goods were cleared without payment of duty & set aside the Order-in-Original - The input-output ratio used for the aforesaid period in demanding duty, wasneither adopted before it nor thereafter - Thereby, no credence could be assigned tosuch a formula - Hence, O-i-A is correct & merits no interference: CESTAT (Para2,5,6)


Cetex Petrochemicals Ltd Vs CCE (Dated: November 4, 2017)

Central Excise - Issue relates to disputed eligibility of certain input services availed byappellant – Original authority and Commissioner (A) allowed credit on certain servicesand disallowed the rest with interest and penalty under Rule 15 (1) of the CenvatCredit Rules, 2004.

Held:Dispute in question relates to the period prior to as well as after the amendmentto Rule 2 (l) - all the disputed services are either required as mandated or obligatedby lawor are otherwise very much required for smooth and ancillary running of theplant and for their business activity - no allegation that any of the services are availedor used primarily for personal use or for consumption of any employee of theappellant – impugned services availed are very much in nature of eligible ‘inputservice' for the purpose of 2(l) of CCR 2004 – Appeal allowed – (Para 4).


Ambassadors Sky Chef Vs CCE (Dated: January 6, 2017)

CX - Assessee engaged in business of airline catering and manufacture of cakes,pastries and chocolates and have entered into catering agreement with variousairlines for supply of metal and food items in accordance with menu given by therespective airline.

Held: Catering to the airline is their main business, and no such similarly placedcaterer was paying Excise duty on such meals - Impugned order is not sustainable on

the question of manufacture: CESTAT


Deepak Engineering Pvt Ltd Vs CCE (Dated: October 31, 2016)

Central Excise – (i) Appeal No.E/870/2006, Excise Duty exemption was claimed by theappellant on the ground that the goods were meant for use in the public interest-water treatment project and when certificate granting exemption was withdrawnappellant came to discharge the liability - When the appellant believed on the publicauthority's certificate levy of penalty under Rule 25 of Central Excise Rules, 2002 isunwarranted. Accordingly, confirming the duty element, penalty is waived – Appealpartly allowed.

(ii) Appeal No.E/466/2007, as the goods suffered duty and the same beingdischarged, they should be treated as duty paid goods - When appellant did not availany exemption relating to the water project due to withdrawal of the certificate by theCollector, appellants case falls under Sl.No.1 of the Table appended to the NotificationNo.8/2003-CE dt. 1.3.2003 - appeal allowed.


C Arunagiri Vs CCE (Dated: September 30, 2016)

CX - Assessee submits that they were basically manufacturers of described goods asdepicted at outset - It is noticeable that till 1996, industry was under impression thatstructural fabricated by them for their own use shall not amount to manufacture andnot liable to duty - Only after 19 years of Tribunal's LB decision in case of Mahendra &Mahendra, the position of law was made clear to them as to exciseability of structuralfabricated for their own use - Accordingly, allegation of suppression shall not subsistfollowing the ratio laid down by Apex court in case of Continental Foundation Jt.Venture 2007-TIOL-152-SC-CX - Suppression with intention to cause evasion onlyinvites extended period - Finding that confusion in law has only caused difficulties toboth sides, it is not possible to hold that it is the case of suppression of fact withintention to cause evasion, to invoke extended period - Accordingly, adjudicationssuffer from limitation for which that is unsustainable - When law was made clear byLarger Bench of Tribunal, duty liability in respect of normal period shall be calculatedby adjudicating authority and assessee shall discharge the same without any penalty:CESTAT


C J R Industries Ltd Vs CCE (Dated: September 9, 2016)

Central Excise - CENVAT Credit - Credit was denied on MS items under capital goodson the ground that they are used for construction of structures. In view of theprecedents, which held that the credit is admissible on MS items used for supportstructures and the fact that the demand period is prior to 7.7.2009, credit isadmissible on MS items used for supporting structures of machinery and fabrication ofspares/components like braces and in erection and fixing of machinery. Hence, Appealallowed. [paras 1, 2, 3]


Hindustan Insecticides Ltd Vs CCE (Dated: March 30, 2017)

CX - Section 4 of the CEA, 1944 - Rule 6 of Valuation Rules, 2000 - Revenue's case isthat subsidy received from the Govt. of India is linked with the quantity of DDTmanufactured and supplied by the appellant and is, therefore, required to be added tothe ‘value' in terms of the Section 4(1)(b) r/w Rule 6 of the Valuation Rules - demandconfirmed with penalty and interest - appeal to CESTAT. Held:Explanation givenunder Section 4(1) is clear that the money value of the additional consideration beingreceived directly or indirectly by the assessee shall be deemed to include the dutypayable on such goods - Said subsidy is an indirect consideration received by theassessee appellant for the subject goods only and this indirect consideration isdeemed as coming from the buyer as in the present case buyer is no other than theMinistry of Health & Family Welfare, Govt. of India only - Though may be this subsidyis sanctioned by the different Ministry and goods might be being supplied to someother Ministry yet both are part of the same entity, which is Government of India only-Rule 6 of Valuation Rules, 2000 makes the position further clear that the value of thegoods shall be deemed to be the aggregate of the subsidized price and thereimbursement or subsidy money - This aggregate is the actual value on whichCentral Excise duty is chargeable as this is the consideration which is flowing directlyor indirectly to the appellant - Explanation to Section 4(1) makes it clear that in caseof reimbursement/subsidy / money received from the Ministry, Govt. of India thesame will be deemed to include the duty of such goods - cum-duty benefitsextendable - CBEC circular Board's Circular No. 983/7/2014-CX dated 10.7.2014 citedby appellant cannot override or supersede the provisions of Central Excise Act and theRules made thereunder - extra consideration received for the subject goods inwhatever form (subsidy or otherwise) has to be treated as part of the assessablevalue - in case of Public Sector Undertaking, it would be absurd to accuse that therewas ‘intention to evade tax' - demand can be upheld only for the normal period oflimitation - Adjudicating authority to requantify the duty demand and consequentinterest and penalty within four months - Appeal partly allowed by way of remand:CESTAT [para 8, 9.1, 10 to 14]



Aurobindo Pharma Ltd Vs CC, CE & ST (Dated: October 7, 2016)

Central Excise - CENVAT Credit - appellant is engaged in manufacture of Bulk Drugsand Formulations and cleared Cefoperazone Sodium Sterile without payment of dutyduring the material period, claiming exemption under Notification No. 4/2006-CEdated 01.03.2006 (Sl. No. 47B.) - However, they did not reverse the CENVAT Creditavailed on inputs used for manufacture of these goods - Demand for recovery of 5%of the value of the exempted goods confirmed under Rule 6(3)(i) and 6(2) of CENVATCredit Rules, 2004, along with interest and Penalty, since common inputs (creditavailed) were used for dutiable and exempted goods; and appellant did not maintainseparate accounts - Commissioner (Appeals) upheld the demands, now agitatedherein.

Held: The crux of the issue is whether the goods cleared under chapter X procedurewithout payment of duty would fall within the category of exempted goods - The issuehas been analysed in various judgments, notably Aureola Chemicals, Hindustan Zinc,SRF Limited, and Dharamji Morarji Co Ltd., - the issue stands covered in favour of theappellant; the demand is unsustainable; and the impugned order is set aside [Para 5-9]


Hcl Info Systems Ltd Vs CCE (Dated: February 2, 2017)

CX - This is the third round of litigation before this Tribunal - Impugned order is

directly in conflict and in teeth of directions of this Tribunal as contained in Final Orderdated 02 May, 2005 and is also in teeth of Ruling of Delhi High Court in case of M/sBasudev Garg 2013-TIOL-464-HC-DEL-CUS - Commissioner have misconceived thedirections which were required to be followed given by this Tribunal rather have daredto overrule them - Impugned order is not sustainable as the same is not in accordancewith the directions given by this Tribunal: CESTAT


Cosme Remedies Pvt Ltd Vs CCE (Dated: January 27, 2017)

CX - Physician samples manufactured on job work basis valued by assessee based on110% of cost of production - Revenue demanded duty on value arrived at on the basisof rule 4 of the Valuation Rules, 2000 viz. on pro rata basis - demands confirmed, soappeal before CESTAT. Held: Apex court in the case of Sun Pharmaceuticals - 2016-TIOL-10-SC-CX has observed that the only reason given by the Revenue is that sincephysician samples are given free of cost by distributors and no price was charged, thecase was not covered by the provisions of section 4(1)(a) of the CEA, 1944 and this isa clearly fallacious and wrong reason; that what ultimately distributors did with thesegoods is extraneous and could not be relevant consideration to determine valuation ofthe excisable goods; that case is squarely covered by section 4(1)(a) of CEA, 1944and valuation arrived at by following the formula given in Ujagar Prints on costconstruction basis is correct - impugned orders set aside and appeals allowed:CESTAT [para 4, 5, 6]


Caress Beauty Care Products Pvt Ltd Vs CCE (Dated: November 4, 2016)

Central Excise - Denial of Credit on the grounds that bills, invoices were addressed tothe factory premises of the appellant and that the same is not in order as per Rule 7,Rule 9 or Rule 3 of Cenvat Credit Rules, 2004.

Held: SCN does not dispute the eligibility of the concerned impugned services, butonly proposed to deny the credit on the ground that the invoices raised on the headoffice were without ISD Registration - non-registration as ISD is only a procedurallapse and curable defect - availment of credit by ISD contains the provisions fordistribution of credit by ISD to its manufacturing units or outsourced manufacturingunits subject to conditions laid down therein - pre-supposes the existence of morethan one unit - however, there is only one unit and there should not be any disputewhether or not the impugned credits are fully attributable to such unit or otherwise -Hence, appellant cannot be denied input service credit - Appeal allowed - (Para 4, &5).


Biotor Industries Ltd Vs CCE, C & ST (Dated: December 27, 2016)

CX - Assessee engaged in manufacture of excisable goods viz., Organic Chemicals andavailed Cenvat Credit on various input services - Alleging that the input serviceinvoices were in the name of their Head Office, at Mumbai, which was not registeredas an Input Service distributor, a SCN was issued for recovery of credit - All the inputservices had been duly received in their Factory at Vadodara and used in or in relationto manufacture of excisable goods - Since assessee had complied/fulfilled with all thecondition for availing cenvat credit on Input Services, therefore, merely because ofthe Head Office was not registered as "Input Service Distributor" at the relevant time

credit cannot be denied to them: CESTAT


CCE Vs Bharti Cellular Ltd (Dated: February 16, 2017)

CX - Erection, installation of telephone towers, BTS/BSC towers being immovable isnot excisable goods and not liable to duty - Issue is no longer res integra - Revenueappeal dismissed: CESTAT [para 4]


Bajaj Hindustan Ltd Vs CC, CE & ST (Dated: August 11, 2016)

CX - Input Goods - Assessee is a manufacturer of Sugar and Molasses - For the periodOctober, 2008 to August, 2009, MS Sheet/Plates, Section and Channels used byassessee for the fabrication of plant and machinery were not considered as input inmanufacture of finished goods - Cenvat Credit taken was disallowed along withimposition of penalty - Definition of 'inputs' during the relevant period underexplanation 2 in Rule 2(k) includes goods used in manufacture of capital goods whichare further used in factory of manufacturer - Court found that most of the items inquestion had been indisputably utilized in the factory of production of excisable goodsand without the use of which the assessee could not have manufactured excisablegoods: CESTAT


Honda Motorcycle And Scooter India Pvt Ltd Vs CCE (Dated: February 6,2017)

CX - Assessee engaged in manufacture of scooters and motorcycles and availedcenvat credit on inputs namely saree guards - Whether assessee is entitled to availcenvat credit on saree guard which have been attached to vehicle cleared by them -Without saree guard, vehicle will remain incomplete and the same cannot be said tothe finished goods ready for sale - In that circumstances, assessee is entitled to availcenvat credit on saree guard: CESTAT


CCE Vs Avi Sales Pvt Ltd (Dated: February 21, 2017)

CX - Assessee firm engaged in manufacture of Cotton Ginning Machinery - Revenuealleged that assessee had wrongly availed benefit of notification by clearing machineryat nil rate & imposed duty demand with penalty on firm & director as well - Uponremand by Tribunal & Commr.(A), demand with penalty was imposed - Whenassessee approached the Commr.(A) again, duty demand & penalty was reduced -Held - Revenue has not challenged reduction in duty - Since major portion of theassessee's sales turnover comes from trading activity, hence, after deducting thetrading sales in computing sales under SSI exemption Notfn. No.08/2003 andextending cum-duty-price benefit, the liability was reduced - However such reductiondoes not absolve the assessee from charge of removal of goods without payment ofduty as assessee was unable to disclose all facts relating to export & other trade sales- Moreover the role of the director has not been brought out & discussed to establishany guilt on his part - O-i-A is correct - Both appeals dismissed & director's appealallowed: CESTAT (Para 2,6,7,8)


Bayer Cropscience Ltd Vs CCE (Dated: February 7, 2017)

CX - Assessees claimed cenvat credit on some input services, namely, 'Staff QuarterMaintenance, Banquet Services, Pandal & Shamiana Services for Artificial FunctionHall and Guest House Services' - Revenue denied these claims on the grounds that thefollowing did not classify as input services under CCR 2004 - Held - Relying ondecision in Saurashtra Cement Limited 2016-TIOL-365-HC-AHM-CX, credit of StaffQuarter and Guest House services is inadmissible & is liable to be reversed - However,credit taken on Banquet, Pandal & Shamiana Services for Artificial Function Hall isadmissible in light of deicisions in Idea Cellular Limited 2011-TIOL-1111-CESTAT-DELand Toyota Kirloskar Motor P. Ltd 2011-TIOL-941-HC-KAR-ST - Impugned ordersmodified: CESTAT (Para 3,7)


Coach Classic Vs CCE (Dated: January 11, 2017)

CX - Assessee company engaged in manufacture & trading of car seats, upholstery &furniture - It is alleged that they created a bogus company in order to claim SSIexemption - Revenue clubbed the clearances of both the firms and denied exemptionto both - Assessee had indeed formed a dummy company for claiming exemption, andno manufacturing activity had taken place for long at this unit - Thereby, clearanceshave been correctly clubbed and duty demand stands upheld as assessee tried toevade payment of duty through formation of dummy firm: CESTAT (Para 2,6,7)


Commander Watertech Pvt Ltd Vs CCE (Dated: January 13, 2017)

CX - Valuation - Section 4 of the CEA, 1944 - Quantity discount cannot be claimed inrespect of clearances made to own depot as there is no sale involved and the discountthough known at the time of clearance is not passed on to the buyer - there cannot beany case of incentives to self - Quantity discount rightly denied by lower authorities -appeal is dismissed: CESTAT [para 4]


Cether Vessels Pvt Ltd Vs CCE, C & ST (Dated: September 19, 2016)

Central Excise - CENVAT Credit - Credit denied on MS items used for fabrication ofboiler for the period 11/2008 to 7/2009 on the ground that they are notcomponents/parts/accessories of boiler but are used as support structures to theboiler, is admissible in view of the precedents which held such credit as admissible -Hence, appeal allowed . [para 1]


Biochem Pharmaceuticals Inds Ltd Vs CCE (Dated: January 12, 2017)

CX – Section 4 of the CEA, 1944- Valuation – whether alleged “discounts” is excludiblefrom AV. Held: Appellant entered into a contract with the Government of Maharashtrathrough the Director, Medical Education and Research, Mumbai for supply of

medicaments at prescribed rate – Appellant has also addressed a letter to RajeshMedical Services, Stockist for supply to Thane Municipal Corporation, Navi MumbaiMunicipal Corporation and Kalyan-Dombivali Municipal Corporation - In the said letter,it has been stated that Rajesh Medical Services will obtain/book and forward orders ofthe above institution and as a consideration for such services, 20% quantity discountwould be offered to the said Rajesh Medical Services - From the said contract, it isclear that the so called 20% quantity discount is not a quantity discount given tobuyer but a commission offered to the stockist – such amount of commission isincludible in Assessable value – above facts were not brought to the notice of theBench while hearing the earlier appeal and when the order dated 08.01.2016 - 2016-TIOL-567-CESTAT-MUM was passed allowing the alleged “discount” – impugned orderupheld and appeal dismissed: CESTAT [para 4]


Chemito Technologies Pvt Ltd Vs CCE (Dated: January 20, 2017)

CX – Appellant cleared excisable goods to Research Institute under exemptionnotification 10/97-CE and paid an amount equal to 10% of the value of the saidexempted goods – subsequently, they claimed refund of the said amount on theground that the provisions of rule 6(3)(a) of CCR, 2004 is applicable only when twodifferent types of goods are manufactured and one is cleared on payment of duty andother under exemption – refund rejected by lower authorities, hence appeal toCESTAT. Held: Bench does not agree with the contention of the appellant - rule 6(3)of CCR, 2004 applies when the excisable goods are cleared on payment of duty andunder exemption and if the common inputs are used in both goods, Rule 6(3)(a) isclearly applicable - payment of 10% of the value of the exempted goods made by theappellant is in conformation to Rule 6(3)(a) which does not require any interference –refund rightly rejected – appeal dismissed: CESTAT [para 4]


Kalyani Steel Ltd Vs CCE (Dated: August 8, 2016)

Central Excise - CENVAT Credit - Credit is admissible on 'columns' of EOT crane sinceEOT crane cannot function without the crane column and as they are covered in thescope of the term 'accessories' in the definition of capital goods at Rule (2)(b)(ii) ofCCR, 2004.

Credit denied on steel items used in fabrication of columns holding that the columnsare used as supporting structures for factory shed and EOT cranes and as such do notfall under accessories or components of capital goods - It is seen that crane column isused to hold crane girders in position properly while the crane is working, hence it isessential accessory for EOT crane installed in appellant's factory as EOT crane cannotfunction without the crane column - Columns of crane are covered in the scope of theterm 'accessories' in the definition of capital goods at Rule (2)(b)(ii) of CCR, 2004 as itis specifically designed/fabricated/manufactured as per specific technical requirementand precedents also held so while allowing credit on the impugned items - Since noevidence was produced by Revenue to show that the goods were not used in thefactory, condition u/r. 2(b) of CCR also stands satisfied - Hence, appellant is entitledto credit on impugned items - Appeal allowed. [paras 2, 3, 4]


Dr Reddy's Laboratories Ltd Vs CC, CE & ST (Dated: October 14, 2016)

Central Excise – CENVAT Credit - appellants are manufacturers of bulk drugs andintermediates and were availing cenvat credit facility under the provisions of CenvatCredit Rules, 2004 - Officers of DGECI, Hyderabad unit conducted investigationsagainst M/s Reliance Cellulose Products (RCP) and M/s YM Drugs & Chemicals,Nalgonda district (YMDC) for availing fraudulent cenvat credit and other violations ofthe Central Excise Act, 1944 - In the process, simultaneous search operations wereconducted at RCP, YMDC and also at the office premises of M/s Aerochem, M/sAerochem Impex Pvt.Ltd. and M/s Finechem - During the investigation it wasobserved that YMDC issued certain central excise invoices and paid central excise dutywithout actually sending any goods to the registered central excise dealers namelyM/s Aerochem Impex Ltd. and M/s Aerochem - M/s Aerochem further issued thedealers cenvatable invoices to the appellants and passed on cenvat credit withoutactually supplying the goods - Since the goods as shown in the duty paid documentswere not cleared from the originating factory at all, the usage of the same by anyother unit in or in relation to the manufacture of finished goods is not possible;Consequently, cenvat credit on such non-existent raw materials was not admissible -Based on the evidences and depositions made, it was alleged that the appellantdeliberately indulged in availment and utilization of cenvat credit under an invoicefraudulently issued by M/s Aerochem without actual receipt of goods covered by thedocument – Denial of the same, its recovery with interest and penalty adjudicated,upheld by Commissioner (Appeals), and agitated herein.


Parabolic Drugs Ltd Vs CCE (Dated: October 25, 2016)

CX - Penalty was imposed under Rule 26(2) of CER, 2002 alleging that assessee hasnot supplied the inputs alongwith invoices issued to principal manufacturer - In SCNas well as adjudication order, there is no such proposal to impose penalty on assesseeunder Rule 25(1) (d) and Rule 26 (1) - For the period prior to 1.3.2007, penalty is notimposable on assessee and for period, post 1.3.2007, penalty of Rs.9,048/- isconfirmed - As the part penalty is not sustainable, therefore the amount of rebateclaim is not be adjusted except Rs.9,048/: CESTAT


Manglam Cement Ltd Vs CCE (Dated: October 14, 2016)

CX - Cenvat credit claims of assessee for auction service disallowed by revenue -Given the circumstances and business nature of the assessee, 'auction services' wouldbe covered within the definition of 'input' - Thereby, assessee's claim allowed: CESTAT


Commercial Engineers And Body Builders Vs CCE (Dated: November 10,2016)

Central Excise - Body building on chassis supplied on job work basis - Failure toreverse Cenvat credit on removal of chassis to assessee's own unit to carry out jobwork - Not irregular as sufficient Cenvat credit balance lying with the assessee - EntireCenvat credit was reversed before issuance of show cause notice - Interest andpenalty unsustainable.

The settled principle of law is that where an assessee is having paid the duty liabilitybefore issuance of show cause notice and there being no bad intention attached to

such under-valuation, the interest liability is not attracted.

The factual position is that the appellant had not reversed the Cenvat credit taken onchassis, when the same were removed to its sister unit for carrying out the job work.However, on pointing out the irregularity by the Audit Wing, since the Cenvat amountwas promptly reversed by the appellant before issuance of show cause notice, thus interms of the decision of this Tribunal in the case of Paper Products Ltd, no interest ispayable by the appellant. Further more, this case is revenue neutral inasmuch as hadthe Cenvat credit been reversed, the same would have been eligible for credit to thesister unit. Since sufficient balance was all along available in the Cenvat account andon pointing out the mistake by the Audit Wing, the same was promptly reversed thereis no loss of Revenue to the Government Exchequer, and as such, there is no questionof compensating the Government for loss of any Revenue.

Rule 15 (1) deals with the situation, where credit has been wrongly taken by theassessee. In this case, since the authorities below have not specifically alleged thatwrong Cenvat credit has been availed by the appellant, sub-rule (1) of Rule 15 ibidcannot be invoked in the facts and circumstances of this case for imposition ofpenalty. Therefore penalty is set aside. Appeal allowed with consequential relief. (Para6-8) - Appeal allowed: DELHI CESTAT


Colgate-Palmolive (India) Ltd Vs CCE & C (Dated: December 8, 2016)

CX - Appellant is engaged in the manufacture of Tooth Powder, which was dutiable upto 29.2.2000, and exempted from payment of duty vide notification no.6/2000-CEdated 1.3.2000 -appellant informing revenue that the entire credit of input which wasused in the manufacture of tooth powder was availed and utilized by them prior to29.2.2000 and since no credit was availed thereafter, they were not required toreverse the credit on the stock and requested to re-credit of an amount reversedunder protest - appellant filed refund claim on 19.7.2005 which was rejected :

HELD - Cenvat credit was availed by the appellant during the period when toothpowder was dutiable, therefore, the availment of credit was legally permissible - noprovision in the CCR existed which provides for reversal of credit which was legallyavailed in case final product gets exempted after availing the credit - this issue is nomore res integra particularly as per the judgment of five member larger bench of thisTribunal in the case of Ashok Iron and Steel - 2002-TIOL-274-CESTAT-DEL-LB whichwas upheld by the Supreme Court - the entire basis of the lower authorities' rejectionof refund claim is the case of Albert David [2003 (157) ELT A-81 (SC)] - as per thesettled legal position, the decision of Albert David does not remain good law,therefore, the same is not applicable - the law emerged is the one which is laid downin the Larger Bench judgment in the case of Ashok Iron and Steel, therefore, theappellant was not required to reverse the credit in respect of input, input contained inthe finished goods, and input lying in work in progress - it is not the appellant whodelayed the filing of the refund but it is department who delayed in deciding the issueraised by the appellant - there is absolutely no case of refund being time barred -appellant is legally entitled for the refund alongwith consequential interest - impugnedorder set aside, appeal allowed : CESTAT [para 5]


Ecoboard Industries Ltd Vs CCE (Dated: February 24, 2017)

CX - CENVAT credit on capital goods can be denied only if the same is usedexclusively for manufacture of exempted goods - rule 11 of CCR, 2004 is applicableonly in respect of inputs/input services - Credit cannot, therefore, be denied on capital

goods by invoking rule 11 of CCR - since the appellant has challenged the order of theAA before the Commissioner(A) and further appealed before the Tribunal, it cannot besaid that the appellant has not challenged the recovery in adjudication although theyhad reversed the credit - impugned order set aside and appeal allowed withconsequential relief: CESTAT [para 4 to 6]



Compu Shop Techno (India) Pvt Ltd Vs CCE (Dated: January 16, 2017)

CX -Appellants purchasing CPU, monitor, key boards, Hard Disk and CD Drive andwithout carrying out any activity sell these items as it is -after receiving at thecustomer's end, while installing, the cable of the monitor and key board need to beconnected with the CPU -this activity does not amount to manufacture, as wholecomputer is already manufactured items by way of assembling of various componentsand in the manufactured condition, it is bought and sold by the appellant -in view ofthe decision in the case of Macro Tech P. Ltd. - 2008-TIOL-1648-CESTAT-AHM, thereis no activity carried out by the appellant which amounts to manufacture of a new anddistinct product - duty demand is not sustainable and so imposition of penalty doesnot arise - the appeal filed by the assessee-appellant is allowed and appeal filed bythe revenue is dismissed : CESTAT [para 5, 6]


City Lubricants Pvt Ltd Vs CCE (Dated: August 26, 2016)

Central Excise - CENVAT Credit - Appellant is engaged in manufacture of Lubricants;availed the CENVAT Credit of the excise duty paid on LSHF-HSD for the period underdispute; and utilized the same for discharging excise duty liability on clearances ofspecified final products - The department viewed the credit irregular, adjudicateddenial of credit and demand for its recovery with interest and penalty, agitated herein.

Held: The definition of input in 2 (k) of CENVAT Credit Rules, 2004 excludes interalia,High Speed Diesel Oil (HSD) from the meaning of input - The use of the word HighSpeed Diesel in the definition of input will therefore necessarily have to harmonizewith the tariff entry and heading of the same item in the Central Excise Tariff Act,hence HSD and all its variations including LSHF-HSD, will be in the same footing, forthe purposes of exclusion under Rule 2(k) of CENVAT Credit Rules 2004 - on meritsthe appellants do not have a case and the authorities below have been correct inholding that input credit cannot be availed on LSHF/HSD - same has been mentionedin the input credit statements; however, the appellant had described the product asST 6733 in the input credit statements for the latter part of the impugned period -therefore, for the period during which the appellant had indicated the description ofthe product/input as LSHF-HSD or LS/HF HSD, the department cannot allegesuppression and hence any demand of duty for the said irregular availment of creditwill be barred by limitation; whereas, during the period in which the appellant hadmerely described the product/input as ST 6733, would amount to suppression/andmis-declaration of vital facts and the department is well within its rights to demandduty for said period - the issue on merits is answered in favour of revenue - However,the demand for the period during which appellant has declared the input goods asLSHF-HSD or LS/HF HSD is not sustainable, and the demand for the period duringwhich the appellant has declared the input goods as ST 6733 is sustained - Thematter is remanded to adjudicating authority for the limited purpose of calculating thedemand sustained for the said period along with interest and consequential revision ofpenalty as applicable [Para 10-12]


Centaur Pharmaceuticals Pvt Ltd Vs CCE (Dated: January 30, 2017)

CX - Whether penalty u/s 11AC should be imposed when the facts are that in thedispute relating to valuation of physician samples, the duty and interest have beenadmittedly paid by the appellants - Appellants are manufacturing medicaments andclearing physician samples by valuing the same @110% of cost of production whereasRevenue contended that valuation should be done in terms of rule 4 of the ValuationRules, 2000 - duty demand was confirmed by the adjudicating authority - appellantspaid the entire duty along with interest and are not contesting the same - prayer isonly for waiver of penalties.

Held: It is seen that valuation of physician samples was not free from doubt andvarious litigations were going on the subject matter - as the appellants were clearingthe goods under cover of invoice and discharged the duty, therefore, there was nosuppression of fact in order to invoke penal provisions - penalty u/s 11AC is,therefore, not imposable - duty paid along with interest is confirmed - appeals forwaiver of penalty is allowed: CESTAT [para 4, 5]


CEAT Ltd Vs CCE (Dated: January 23, 2017)

CX - Issue is whether in the case of provisional assessment, if the differential duty ispaid before finalization of the assessment, whether for the delay in payment of dutyfrom the date of clearance of the goods till the date of payment of duty, interest ischargeable or otherwise during the period 2012-13.

Held: Issue has been decided in the appellant's own case by the Bombay High Court2015-TIOL-397-HC-MUM-CX [Revenue appeal dismissed by Supreme Court on14.12.2015] holding that interest is not chargeable on the differential duty paid beforefinalization of assessment - impugned order is, therefore, set aside and appeal isallowed: CESTAT [para 5]


Cadbury India Ltd Vs CCE & C (Dated: January 02, 2017)

CX - Issue is whether Interest on receivables through cheque discounting ispermissible deduction to arrive at the assessable value of the excisable goods sold bythe appellant through their depot.

Held: Issue is squarely covered by the Tribunal judgments in appellants own case -Inasmuch as the impugned order disallowing the deduction on account of interest onreceivables through cheque discounting is not correct and legal -impugned order setaside and appeal allowed : CESTAT [para 3, 4]


Brakes India Pvt Ltd Vs CCE & ST (Dated: December 02, 2016)

Central Excise -Denial of input service credit on servicing of Cars, Cleaning service andAgri-Horticulture services.

Held: Lower authority has disallowed credit on servicing of cars on assumption that

cars are used only for activities which have nexus with the manufacture and that theycould have been used for personal effects - This conclusion is peremptory and withoutevidence - in the case of CCE & ST Vs Mangalore Refinery & Petrochemicals Ltd it hasbeen held that service tax paid for services inter alia of repair and maintenance ofcompany's vehicles would be an eligible "input service" - Hence, the said service isvery much an eligible ‘input service' for the purpose of Rule 2(l) - Regarding cleaningservice, list of eligible input services given in Rule 2(l) being inclusive, it can includemany more of its genre - cleaning service is also not specifically excluded from Rule2(l) as it existed during the relevant period - Agri- horticulture cannot be disallowed -Appeal allowed - (Para 4, 5, & 6)


Bnazrum Agro Export Pvt Ltd Vs CCE (Dated: November 28, 2016)

Central Excise - Wrongly availed credit in respect of Banking and Other FinancialServices - Appellant came up against the Commissioner (A) rejecting the appeal fornon-deposit of amount stipulated and Input service credit availed has also beendisallowed on the grounds that invoices issued by service provider do not contain STPcode of the service provider.

Held: As per definition of Rule 2(l) during the period of June 2014, the nature ofbanking and financial services availed by appellant are in no way disbarred - Bankingand Financial services for FOREX is an eligible ‘input service' for the purposes of Rule2(l), also the availment of the said credit on the strength of computer generatedservice issued by the bank is very much in order - Hence, the demand in this regardwill not sustain and will have to be set aside - Remanding the connected appeal for denovo consideration concerning the eligibility of the said input service - Appealsdisposed - (Para 6, & 7).


Continental Engine Ltd Vs CCE (Dated: January 19, 2017)

CX - Assessee, 100% EOU engaged in manufacture of aluminium automotivecomponents - They have made use of aluminium ingots both imported as well asprocured indigenously and sent them to job workers for converting the same intoaluminium castings which were used in further manufacture of automobile parts - Noevidence has been brought on record by Revenue to indicate that any part of suchaluminium ingots has been diverted - Hence, entire quantum of aluminium ingotsprocured have, in fact been, utilised for production of final products - However, part ofingots which has been lost in form of wastage is more than norm of 6% - Quantum ofingots which has been consumed towards wastage beyond the norm of 6% is to beconsidered as utilised beyond the scope of permission for procurement of duty freeinputs - However, since absolutely no evidence of diversion or suppression is onrecord, it is difficult to sustain the charge of suppression and invoking extended timelimit for demand of such duty made - In respect of two SCNs, demand is to berestricted to that falling within normal time limit and for this purpose, case isremanded to original adjudicating authority: CESTAT


Concast Ferro Inc Vs CC, ST & CE (Dated: November 15, 2016)

CX - Assessee are manufacturers of pig iron and availing the facility of Cenvat crediton input and capital goods - Assessee submitted that though they availed workscontract services, such services were not availed for construction of a building or a

civil structure - Invoices show that though assessee has paid Vat on works contractservices, ST is seen paid only on labour component of said works contract service - Insuch score, assessee cannot claim credit on works contract service and therefore,denial of credit is legal and proper: CESTAT


Coromandel Paints Ltd Vs CCE (Dated: September 9, 2016)

Central Excise - CENVAT Credit - Credit availed MS items are used in fabrication ofMezannine floor between the ground floor and roofing, which is used for packing andstoring the final goods - Final goods being paints and varnishes, have to be packedand then only can be cleared - Hence, use of MS items can be considered to beconnected with the manufacture of final products - Moreover, the demand period isprior to the amendment of the definition of inputs on 7.7.2009 - Hence credit isadmissible on MS items used in fabrication of Mezannine floor - As regards the otherpart of the demand for reversal of credit which was accepted by appellant, since thereversal was made prior to issuance of SCN by accepting the liability, demand issustained while penalty imposed is set aside - Hence, appeal partly allowed. [paras 2,4, 5, 6]


Deevya Shakti Paper Mills Pvt Ltd Vs CCE, C & ST (Dated: November 18,2016)

CX - Assessee engaged in manufacture of paper and are availing facility of CENVATCredit on inputs and capital goods - Credit is sought to be denied by lower authoritiesfor the reason that MS items like angles, do not fall within definition of capital goodsor inputs - Assessee submits that MS items were used for fabrication/manufacture ofstorage tanks and produced a Chartered Engineer Certificate to establish the detailsand purpose for which MS items were used - Said issue was held in favour of assesseein many cases - Credit admissible on said items - Disallowance of credit is unjustified:CESTAT


Thyssenkrupp Electrical Steel India Pvt Ltd Vs CCE (Dated: February 24,2017)

CX - Input Service - Rule 2(l) of CCR, 2004 - maintenance of garden is statutoryrequirement as per the Maharashtra State Pollution Control Board, according to which33% of the premises of the factory should be maintained as garden to minimize thepollution within the factory premises - Garden services is an input service and credit isadmissible - impugned order set aside and appeal allowed: CESTAT [para 6, 7]



Gelma Frozen Creams Pvt Ltd Vs CC & CE (Dated: October 19, 2016)

Central Excise – SSI Exemption - Appellants are manufacturers of Ice creams bearingbrand name "LAZZA" and UNCLE JOHN" in their unit located in rural area - theyavailed the SSI Exemption under Notification No 08/2002 - C.Ex dated 01-04-2002during the material period – a departmental intervention occurred, incriminatingdocuments recovered and it was observed that the Unit was not maintaining anymanual records in respect of inputs/finished products regarding receipt, issue, stocks,

production, clearance etc., was not preserving the copies of invoices, and the valueadopted by the assessee was on the basis of whole sale price and not on the basis ofMRP – Duty demand with interest on firm and individuals adjudicated, upheld byCommissioner (Appeals), and agitated herein.

Held: The facts reveal that only part of the clearances made were accounted in SBIaccount of the unit - The super stockists/buyers have been making the depositstowards some part of the goods received by them in the KVB account of the Director –The contention that the said amounts were withdrawn and deposited in the SBIaccount of the appellant unit to prove that there were no unaccounted sales, is nottenable or acceptable - The modus-operandi of depositing the sale proceeds in to theKVB account of Director and thereafter re-depositing or transferring the same into theaccount of appellant unit can only be to cover up the unaccounted clearancesinasmuch as the SBI account of appellant unit would reflect these amounts astransferred /withdrawn and deposited from KVB account of Director and not asamounts received from clearances of goods - this is an effort to cover up theunaccounted sales, since the deposits made in the KVB account tallied with theaccounts of the super stockist/buyers in regard to the clearances made by appellant tothem - the appellant has not been able to correlate or provide information with regardto the entire value of clearances, hence the liability above threshold limit arises -there has been unaccounted sales and the activity of clandestine clearances havingbeen established, no grounds to interfere with the equal amount of penalty imposedon the appellant unit - The facts and evidences establish that the Director Shri LDanunjaya had a conscious role in the above activities of unaccounted sales; however,a penalty of Rs.10,000/- would meet the ends of justice - Penalty imposed on SriK.Shivakamini Kumar is unwarranted since the person is only an employee of theappellant unit; same is set aside - Appeal No.91/2008(Gelma Frozen Creams(P)Ltd) isdismissed; Appeal No.E/92/2008 (Shiva Kamini Kumar) is allowed; and AppealNo.E/93/2008 (L.Danunjayan) is partly allowed [Para 6-8]


Crystal Copler Systems Pvt Ltd Vs CCE (Dated: November 4, 2016)

Central Excise - Sale of refurbished photocopier machines – SCN issued proposingdemand in respect of photo copiers cleared without payment of Central Excise Duty –Settlement commission directed appellant to pay a certain amount of duty along withsimple interest on the duty excluding CVD amount – the department was directed todeduct the CVD while calculating the interest – Appellants claimed refund vide anotherapplication which was rejected.

Held: The issue relates to calculation of interest liability as ordered by the SettlementCommission - Commissioner (Appeals) finding in his order that appellant'srepresentation to adjust the interest demand with their eligibility for refund cannot beentertained, therefore is not in consonance with the directions of the SettlementCommission - appellant has also created further confusion by submitting two claims ofdifferent amounts of refund pursuant to Settlement Commission order, a fact whichhas been taken note of in the order of lower appellate authority - interest of justicewill be best served by remanding the matter back to the original authority for de novoconsideration of the matter – Appeal disposed – (Para 4, & 5).


Cords Cable Industries Ltd Vs CCE (Dated: October 4, 2016)

Central Excise - Mega Power Project - Goods supplied against InternationalCompetitive Bidding - Exemption under Notification No.6/2006-CE -Held cannot bedenied on the ground that classification is not matching with the project importclassification under Heading 9801 of Customs Tariff. (Para 2, 3)


CCE Vs Dabur India Ltd (Dated: January 10, 2017)

CX - Assessees firm manufacturers edible preparations, Bulk Drugs, P.P. Medicines,Essential Oils and Machinery Items, of which some are dutiable while others attract nilrate of duty - Assessee used furnace oil for generating steam, which was further usedin manufacture of both dutiable and exempted final products - Revenue sought todeny cenvat credit of furnace oil for alleged non-maintenance of separate accounts ofduty paid by the assessee on furnace oil - There is no need to maintain separateaccounts in the present case as it is clear that the assessee availed credit only onthose quantity of inputs which were used for manufacture of dutiable goods: CESTAT


Mahindra And Mahindra Ltd Vs CCE (Dated: May 25, 2016)

CX - Assessee manufactures motor vehicles & components & avail cenvat credit oninput good/services and capital goods - Some credit on work contract service was heldinadmissible & was disallowed - Duty demand for reocvery of credit amout, withinterest & penalty was levied - The works contract service in relation to building, civilstructure, laying of foundation has been brought within the ambit of exclusion toexclude not only setting up but something more - Assessee eligible to claim credit onexpansion of capacity of ETP & flooring works while credit for services used for layingfoundation of tank/cooling tower disallowed: CESTAT


Davinder Exports Vs CCE (Dated: January 19, 2017)

Cus - Removal - Investigation was conducted to the appellant and the statementswere recorded - SCN were issued to them alleging that they made a fraudulentremoval of goods and therefore, required to pay duty - Tribunal has already held thaton the basis of statement of Sh. Baldev Singh, Managing Director of assessee and inabsence of evidence in form of to manufacture of such huge quantity, consumption ofelectricity, additional packing material payment for purchase of additional packingmaterial, payment received for clandestine removal of goods, how the goods weretransported has been brought on record by Adjudicating Authority or inspecting team,the charge of clandestine removal is not sustainable: CESTAT


Easter India Chemicals Ltd And Raj Tandon Vs CCE (Dated: December 29,2016)

CX - Input/output data in ER-5 return for year 2007-08 is used to estimate quantumof goods manufactured in year 2005-06 - This estimated manufacture is not coveredby any of provisions of Central Excise Act or Rules made thereunder - SCN has notinvoked any enabling provisions which enables Revenue to use input/output datagiven in ER-5 return for charging duty on estimated goods that should have beenmanufactureed by assessee - If provisions of erstwhile Rule 173E of CER, 1944 areinvoked then it was mandatorily required to fix norm for electricity consumption,notify them to manufacturers and thereafter ascertain reasons for deviations, andafter taking into account the consumption of various inputs, requirements of labour,material, power supply and conditions for running the plant together determine thegoods manufactured and demand duty on differential quantity of goods - Since suchexercise was not carried out, impugned SCN is not sustainable in law: CESTAT


Pam Pharmaceutical And Allied Machinery Company Ltd Vs CCE (Dated:March 8, 2017)

CX – Valuation – Section 4 of the CEA, 1944 - Charges for servicing of already soldmachines is not includible in transaction value - appellant on all these activities ofservicing of sold machines by deputing servicing engineer, training of the operator,charges for providing assistance in plant layout is discharging service tax - Theseactivities are completely independent from the manufacture and sale of the machine -order passed by the Commissioner (Appeals) on identical issue for the past as well assubsequent period allowing the appeals of the assessee was not challenged by theRevenue - charges collected by the appellant from customer, whom the machineswere sold long back, is not includible in the assessable value of the machine –impugned order set aside and appeal allowed: CESTAT [para 4]



Dhody Products Pvt Ltd Vs CCE (Dated: October 4, 2016)

CX - Assessee engaged in manufacture of Aluminium Pilfer Proof Caps liable to CentralExcise duty - During the course of manufacture of cap, aluminium scrap is generatedwhich is also liable to duty - Department prepared month wise and year wise details ofPilfer Proof manufactured by assessee, details of caps manufactured, raw materialsused and scrap generated is available on daily basis - Party is required to pay duty onthe same basis as in case of other final products manufactured by them as per the law-

In an admitted case of clandestine clearance, assessee cannot take advantage of non-maintenance of statutory records to pay least of duties or interest on very ground ofnon availability of recorded evidence for date of clearance - That will amount tounwarranted indulgence to an assessee who cleared the excisable goods unaccounted.

Based on price comparison on accounted clearance, assessee pleaded recalculation ofduty liability on cum-duty basis - Total duty involved is almost Rs.1.5 crores and thereis no contest against duty demand - Considering the overall gravity and implication ofoffence, no reason found to interfere with the findings of the original authority order:CESTAT


Surya Balaji Steels Pvt Ltd Vs CCE (Dated: September 16, 2016)

Central Excise - Pre-deposit / Limitation - The appellant approached Commissioner(Appeals) filing appeal on 17.07.2015 against the impugned order dated 29.04.2015which was served on 08.05.2015; without making mandatory pre-deposit and withoutany application for condonation of delay - The appeal was dismissed, and the same isagitated herein.

Held: Record reveals that at the time of filing of the appeal there was no mandatorydeposit made - When law requires certain things to be done in the manner requiredby it, in absence thereof, non-compliance to law denies statutory remedy - The pre-deposit was made in January, 2016 debiting the Cenvat credit accounts - However, 90days expired on 07.08.2015 and pre-deposit could not come up within that period -Therefore for non-compliance to law, Commissioner (Appeals) rightly dismissed theappeal, and no appeal before Tribunal is entertainable [Para 2, 3]


Flexible Packaging Company Pvt Ltd Vs CCE (Dated: January 6, 2017)

CX – Appellant taking credit of jumbo rolls of PVC (Ch.39) and Aluminium Rolls(Ch.76) and after slitting the said rolls cleared the same on payment of central exciseduty – CENVAT credit sought to be denied on the ground that cutting of jumbo rollsdoes not amount to manufacture – demand confirmed, hence appeal to CESTAT.HELD: Tribunal, in an identical case of Fine Packaging Pvt. Ltd. - 2016-TIOL-624-CESTAT-MUM observed that even if it is accepted that the activity does not amount tomanufacture, cenvat credit on the inputs cannot be denied in view of the provisions ofrule 16 of CER, 2002 - following the decision of the Tribunal, the appeal is allowed :CESTAT [para 5, 6]


Emco Ltd Vs CCE (Dated: February 2, 2017)

CX – Appeal is against order of the Principal Commissioner communicated by theAdditional Commissioner by which the request of the appellant for cross examinationof the witnesses whose statements were relied upon in the show-cause notice wasrejected. Held: It is settled law that as per Section 9B of CEA, 1944 even if the crossexamination is not asked for, it is obligatory on the part of the adjudicating authorityto cross examine the persons whose statements were recorded – request made byappellant is legitimate and same must be allowed – Impugned order is set aside andappeal is allowed: CESTAT [para 4, 5]


Eicher Ltd Vs CCE (Dated: October 20, 2016)

Central Excise – Issue being whether the assessee is liable to pay duty on the goodsmanufactured by the job workers which were removed without payment of duty totheir duty paid spare parts store – Appellant submits that is the status of the jobworker is SSI, the goods shall not suffer duty since the job worker is also entitled toSSI benefit – duty liability was discharged incorporating that in finished goods –Revenue says that appellant is liable to discharge duty when there was manufacturecarried out – revenue also claims that there were certain bought out items by theappellant and those were sent to the job worker for use in processing which have notsuffered duty.

Held: As the appellant categorically submitted that in absence of any undertakinggiven by it and such undertaking not borne by record, it cannot be presumedotherwise to hold against the appellant on the allegation that it had undertaken tobear the duty liability on the job worked goods – Law is well settled that job workedgoods shall be liable to duty, but such liability is subject to consideration as towhether job worker was entitled to SSI benefit – So adjudication authority, if satisfiedwith the plea and that is borne by record as well as the material suggest that theappellant had not given any undertaking to bear duty liability on the goodsmanufactured by job worker, there shall be no duty liability on the appellant – nopenalty as it was only an interpretational issue – Appeal remanded to a limited extent– (Para 6, & 7).


Vedanta Ltd Vs CCE (Dated: October 13, 2016)

Central Excise – Stay - stay of operation of the letter C.NO.IV/16/08/2015-C(A),dated 08.01.2016 issued by the Superintendent and against hearing of the appealexpeditiously to do justice to the appellant – Appellant approached Commissioner (A)to make verification of challan to reconcile the date of removal as well as the date ofreceipt of the goods removed for job work from Tuticorin to Chinchipada (Silvassa)and pass appropriate order - adjudicating authority passed an order calculatinginterest demand while no interest is recoverable without duty demand – Strange thatthe Superintendent has exercised the power of appellate authority without such powerbeing conferred on him.

Held: Public authority should pass public order publicly - No delegation of powershould be made in absence of express power to delegate - Therefore, Commissioner(Appeals) is directed to admit the appeal of the appellant which has emanated asoutcome of his direction only and hear the appellant – MA (EH) stands disposed andthe Misc. Application for stay of operation is disposed as fructuous.


Godawari Power and Ispat Ltd Vs CCE & ST (Dated: January 19, 2017)

CX - SCN was issued alleging that the Iron Ore Fines, Coal Fines and Waste and Slagcleared from the factory along with the main products, are exempted goods and sinceInput services on which credit is availed are used commonly in taxable and exemptedfinal products, 10% value of exempted goods is to be paid along with interest andpenalty in terms of rule 6(3)(b) of CCR, 2004 - Commissioner confirming demand,hence appeal to CESTAT. Held: Apex Court in the case of Hindustan Zinc Ltd. 2014-TIOL-55-SC-CX has held that by-products cannot be held to be final products and,therefore, for clearance of exempted by-products there is no need for reversal of8%/10% - in view of the well-settled legal position, impugned order set aside andappeal allowed: CESTAT [para 5, 6]


CCE Vs Jagdambay Flavours (Dated: October 24, 2016)

CX - Assessee engaged in manufacture of pan masala containing tobacco, commonlyknown as gutkha under the brand name of "Kaka" - Revenue contested that instead ofmaking suo moto adjustments, assessee should have applied for refund of duty paidby them in excess - When the liability for period July was also required to bedischarged in month of August, 2008 itself and the assessee done so, Tribunal foundno merits in Revenue's appeal and no justifiable reasons to interfere in impugnedorders passed by lower authorities: CESTAT

2017-TIOL-1096-CESTAT-KOL

CCE, C & ST Vs Kunj Alloys Ltd (Dated: July 27, 2016)

CX - Issue involved is regarding refund of unutilized credit under Rule 5 of CCR, 2004read with Notfn 05/2006-CE(NT) - Assessee has utilized more credit than whataccrued to them during the relevant quarter - Credit lying unutilized in Cenvat creditaccount in beginning of the quarter is not relevant when assessee is manufacturingand clearing goods both indigenously and for export and a common Cenvat credit withrespect to inputs is taken - Refund claim during the relevant quarters were notadmissible to assessee and were correctly rejected by Adjudicating Authority: CESTAT


CCE Vs Crompton Greaves Ltd (Dated: September 21, 2016)

CX - Whether raw materials damaged/destroyed in fire accident and were not used inor in relation to manufacture of final products can be considered as "inputs" in termsof Rule 2 (K) of CCR, 2004 - Rule 3(1) of Rules, 2004 is enabling provision, whichentitles a manufacturer to take cenvat credit of CX duty paid on inputs used in or inrelation to manufacture of final products within the factory - Since receipt of inputs infactory for use in intended purpose and duty paid character of same are not indispute, destruction of such inputs due to fire accident will not call for reversal ofcenvat credit taken on such inputs - No merits in appeal filed by Revenue, therefore,same is dismissed: CESTAT


Dabur India Ltd Vs CCE (Dated: November 25, 2016)

CX - Whether assessee is liable to pay interest from 07.09.1998 to 10.10.2000 on theamount of Rs. 2.50 lacs deposited by them pursuant to amendment in Rule 57 F(17)in FA, 1999 - Commissioner (A) has determined the interest to be paid from07.09.1998 to 10.10.2000 on the basis that assessee have utilized the credit of thisperiod - Assessee have paid the amount of Rs. 2.50 lacs pursuant to retrospectiveamendment in 57 F(17) brought in FA, 1999 - Since the law is clear about date ofapplication of interest as well as the rate of interest, charging the interest with effectfrom 07.09.1998 is contrary to provisions of FA, 1999 - Interest would be payablefrom 11.06.1999 to 10.10.2000 at the rate of 36% per annum: CESTAT


Delta Power Solutions India Pvt Ltd Vs CCE (Dated: December 01, 2016)

Central Excise - Denial of Refund claim filed by the appellant under Rule 5 of CenvatCredit Rules, 2004 and Notification No.27/2012-CE (NT) on the ground that cenvatcredit taken could not be utilized by them - Claim disallowed on ground that it wasfiled after a lapse of one year after the date of which goods have been exported -Commissioner (A) upheld the same - HC of Madras while holding that the writ petitionis not maintainable before the court at this juncture, liberty is granted opportunity tothe petitioner to approach the tribunal.

Held: The fact that the refund claim was on account of the credit accumulated due toclosure of the factory, is not adequately canvassed before the original authority andlower appellate authorities - this is a situation where the appellant has closed downthe factory, however, in the absence of any other provisions for claim of credit at thetime of closure they filed refund claim, under same Rule 5, after conforming to therequirement of Notification No.27/2012 requiring reversal of such credit - unutilizedcredit lying in the books of account on account of closure of factory should not bedenied only on account of that they did not meet other procedural requirements ofRule 5 of the Rules read with Notification No.27/2012 - Hence, refund is very muchadmissible - matter remanded back for ascertaining of eligible accumulated credit thatremained unutilized - Appeal allowed - (Para 5)


Escorts Construction Equipment Ltd Vs CCE (Dated: January 12, 2017)

CX - Assessee supplied goods to be used in projects financed by UN or otherinternational bodies - They were denied exemption under Notfn 108/95 - CE forallegedly not supplying goods directly to the project authority but to other contractors- All conditions in the notification satsfied by assessee - Supplying of goods directly toagency executing the project for Project Implementing Authority, cannot go againstclaim for exemption: CESTAT (Para 4,5)


IOCL Vs CCE (Dated: August 19, 2016)

CX - Whether assessee is entitled to Cenvat Credit on 13- items claimed to be used ascapital goods - Case of assessee is that on 7 items, out of 13 disputed items, credithas already been allowed by subsequent orders passed by Jurisdictional JointCommissioner & Additional Commissioner which have been accepted by department -As none of documents and case laws, placed before bench were available toAdjudicating authority, therefore, matter remanded to decide the eligibility of CenvatCredit on disputed items in light of later developments - As it is a case ofinterpretation of provisions of CCR & assessee had a view on admissibility of CenvatCredit, it is opined that this is not a fit case where imposition of penalty under Rule15(1) is justified: CESTAT


CCE Vs Kasi Works (Dated: October 5, 2016)

CX - Tax realization would have been made at the earliest had there been collection ofNCCD from job worker - But in reality CX law being a value addition law, there was anhigher amount of NCCD collected by Revenue from hands of principal manufacturerwith value addition of job worked goods - When principal duty liability was notrealisable from job worker in terms of notfn benefit, realizing NCCD alone from jobworker is inconceivable since the department opted postponement of realization ofexcise duty till payment thereof by principal manufacturer - No reason found to dilatethe matter further to make academic exercise: CESTAT


Mithila Malleables Pvt Ltd Vs CCE (Dated: October 28, 2016)

CX -Assessee company allegedly availed credit, based on transactions with a non-existent firm & without actually receiving goods - Only the statement of proprietor ofassessee company relied on - No investigation conducted by revenue at the end ofmanufacturer supplier against whose invoices the assessee has taken credit - Noinvestigation conducted from the transporters to ascertain the fact whether goodshave been transported to the assessee's factory or not - Revenue failed to dischargeonus of proving that the assessee had not physically received any goods, when theassessee was able to provide an invoice: CESTAT (Para 2,6,8)


EPE Process Filters and Accumulators Pvt Ltd Vs CC, CE & ST (Dated:November 18, 2016)

CX - Assessee claimed refund of excise duty wrongly paid - Department orderedrefund amount to be credited to Consumer Welfare Fund - Department has notconsidered certificate issued by BHEL & by certified CA to assessee proving excess

payment - Assessee paid excise duty wrongly, included it in invoice but did not collectit from BHEL - BHEL stated that they have not paid the excise duty raised in theinvoice - Duty burden has not been passed on - Refund is not hit by unjustenrichment: CESTAT (Para 2, 5, 8)


Sri Sukra Spinning Mills Pvt Ltd Vs CCE (Dated: November 21, 2016)

Central Excise - Clearance of Cheese Yarn as Hank Yarn without payment of duty andalso cleared without any invoices - on both counts, authorities found that theappellant made breach of law and demand of duty was made.

Held: Non-service of the documents on appellant was its grievance before theCommissioner (Appeals) - The documents were served on the Director of theappellant-company and that could not be refuted by appellant - adjudicating authorityfound that the cheese yarn were cleared as hank yarn and disguised clearance weremade to avoid payment of duty - the entire admitted deposition of the witnesses wascorroborated by the confessional statement of the Managing Director - The manner ofexamination of the material fact and evidence on record reflects that the adjudicatingauthority had thoroughly applied his mind - Hence, not only plea of violation of naturaljustice but also plea on merit fails - Appeal dismissed - (para 4)


Jaipur Golden Transport Company Pvt Ltd Vs CST (Dated: August 31, 2016)

CX - Assessee is an 100% EOU and cleared goods in DTA without proper permission -Demand with penalty imposed on assessee - Relying on decision in case of SarlaPerformance Fibre Ltd. as the judgment squarely covers the facts of the present case,appeals filed by both assessee & revenue become infructuous: CESTAT


Kejriwal Casting Pvt Ltd Vs CCE (Dated: August 31, 2016)

CX - The assessee, having manufacturing units submitted that value based exemptionNotfn 9/2003-CE is for entire financial year, therefore, amendment carried out by it,will also be effective from 01.04.2003 and value exempted under it will not exceed Rs.3 Crore due to the fact that the total value of clearances being Rs. 2.94 Crore -Demand being time bared, penalty u/s 11A cannot be invoked - Revenue referredcase of Kartar Rolling Mills - 2006-TIOL-46-SC-CX , where it was observed thatbenefit of an exemption notification cannot be extended retrospectively - However,penalty against assessee is not sustainable and is set aside - As far as value ofclearances, matter is remanded to Adjudicating authority to examine that total valueof clearances of both the units, even if exempted goods of Notfn 83/94-CE and 84/94-CE are added to value of clearances, will not exceed Rs.3.00 Crore during and that nodifferential duty is payable: CESTAT


GR Sponge and Power Ltd Vs CCE (Dated: January 31, 2017)

CX – Proportionate CENVAT credit in respect of GTA service used for transporting coalis denied on the ground that the coal is washed outside the factory premises andwhich results in reduction of weight – appeal to CESTAT. Held: Reasoning that the

inputs i.e. coal get reduced in weight by 15% and as such transportation chargeswould also get reduced and the consequent service tax on the same would getreduced is not agreed with – if that be the reasoning, then the assessee would alsobe required to pay less service tax - service tax payment or the credit of the servicetax paid is not relatable to the quantum of inputs so received but is relatable to thetransportation charges paid by the appellant to the transporter – rule 3(5) of CCR,2004 is also not applicable - no reason to deny the credit – impugned order set asideand appeal allowed: CESTAT [para 2 to 4]


Emerson Network Power (India) Pvt Ltd Vs CCE (Dated: February 27, 2017)

CX - Valuation - Prior to 14/05/2003, there cannot be any demand on incidentalcharges like freight and insurance charges for clearance of goods from factory gate todepot for the reason that the depot was absent in the definition of ‘place of removal'in Section 4 of the CEA, 1944 - Impugned order set aside and appeal allowed: CESTAT[para 4, 4.1, 5]



Shore To Shore MIS Pvt Ltd Vs CCE & ST (Dated: December 22, 2016)

Central Excise - Classification - envelopes were manufactured to carry buttons thereinand such envelope is classifiable under the Tariff Heading 481700, which morespecifically attracts envelopes of different kinds and different sizes within its ambit -Revenue claims that it was a packing container and classifiable under Tariff heading4819.90.

Held: Based on the samples, it demonstrates that the small envelopes were made tocarry a few buttons therein without being capable of carrying any other goods therein- When there is specific entry of envelopes in the tariff entry 48.17, there is nonecessity to go to any other heading to list the character of the goods in question -classification sought by the assessee under tariff heading 48.17 is upheld and appealis allowed - (Para 4).


Thiru Arooran Sugars Ltd Vs CCE (Dated: December 30, 2016)

Central Excise - Disallowance of Cenvat Credit on service tax paid - final productswere stored in the godowns hired at different places - When rent was paid to avail thegodown facility, that suffered service tax.

Held: Storage of goods in hired godowns has direct nexus to the manufacture toremove congestion in the factory - such integral connection does not call for denial ofthe Cenvat credit of the service tax paid on rent paid to avail god own facility - appealallowed - (Para 3)


Twenty First Century Pharmaceuticals Pvt Ltd Vs CCE (Dated: January 2,2016)

Central Excise - Section 4A of Central Excise Act, 1944 - MRP assessment – Appellantclaims goods which are meant for sale shall be subjected to MRP but the physiciansample cleared by it not being meant for sale in retail, valuation of the goods underSection 4A shall not be resorted to but Section 4 shall apply.

Issue is whether the "physicians sample" not meant for sale shall be valued underSection 4 or 4A of Central Excise Act,1994.

Held: In view of the Board's clarification that the goods mentioned shall be governedby Rule 4 of the Valuation Rules, it follows that the physicians sample shall begoverned by section 4 of Central Excise Act, 1944. for valuation – Appeals allowed –(Para 5, & 6).


Venus Wire Industries Pvt Ltd Vs CCE (Dated: February 14, 2017)

CX - Rule 2(l) of CCR, 2004 - Input Service - Appellant availing CENVAT credit inrespect of ST paid on services received from CHA in respect of export of theirconsignments - lower authorities denying the same on the ground that the saidservices were availed beyond the place of removal and are not covered under thedefinition of Input services - appeal to CESTAT. Held: Issue is settled by variousdecisions of Tribunal and clarification 999/6/2015-CX dated 28.02.2015 issued byCBEC clarifying that transfer of property can be said to have taken place at the portwhere the shipping bill is filed by the manufacturer exporter and place of removalwould be this Port/ICD/CFS - in view of the unambiguous clarification and citedTribunal decisions, demand of reversal of CENVAT credit taken in respect of CHAservices utilized for export of goods cannot be sustained - appeal is allowed: CESTAT[para 4, 5]


CCE Vs Visen Industries Ltd (Dated: August 22, 2016)

CX - Cenvat credit availed by appellant on 'stainless steel plates' procured from M/s.Jindal Stainless Steel Co. and exported as such - the original authority held thisavailment to be contrary to Cenvat Credit Rules, 2004 and denied the credit - onappeal, the first appellate authority set aside the order, therefore, revenue has filedappeal before CESTAT.

Held: Question that was not answered in the impugned order is whether the goodsused in manufacture of capital goods and deemed as 'inputs' in accordance withExplanation 2 of Rule 2(k) of CCR, 2004 are, when not used for manufacture, coveredby the qualifying expression 'intended' in the decision of the Supreme Court in re BPLDisplay Devices Ltd. - 2004-TIOL-121-SC-CUS the clearance of goods procured formanufacture of capital goods, if any, for other than as capital goods would take it outof the purview of inputs and disqualify if from being described as 'input' - in theabsence of a special legislative sanction to extend this facility of removal of suchinputs procured for making of capital goods, there is no empowerment vested in theCentral Government to prescribe terms, conditions and safeguards - by export of suchprocurement as such, the appellant would accumulate adequate credit to avoid payingduty, through account current-however, a manufacturer who adopts the strategy ofprocurement for export, on the strength of interpretation as proposed by respondent,would be misusing this facility to deprive exchequer of taxes in excess of normaloffset of credit on inputs -for the above reasons, as held by judicial decisions and toensure that there is no travesty of taxing intent of Central Excise Act, 1944, impugnedorder is set aside and appeal allowed : CESTAT [para 4, 7, 8, 9, 10, 11]


CCE Vs Mahavir Vanaspati Company (Dated: September 21, 2016)

Central Excise - Manufacture of dutiable and exempted goods from common inputs -Vanaspati was exempted for payment of duty from 01.03.2005 - Demand of 10%amount on the ground that failure to maintain separate account of inputs inmanufacture of dutiable and final exempted products pre-01.03.2005 is whollyunjustified - Commissioner (A) rightly held that assessee is entitled to avail credit oninputs contained in dutiable final products - Recovery proceedings under Section 14 ofCEA unsustainable - Consequently Revenue appeal being without merit is dismissed.

It is clear that till 28.02.2005, the respondent was not manufacturing exemptedgoods. Only from 01.03.2005, the vanaspati in question became exempted frompayment of duty therefore, from 01.03.2005, the respondent is required to maintainseparate account of inputs used in manufacturing of dutiable as well as final exemptedproduct, but the Commissioner (A) in the impugned order has observed that theCenvat credit on inputs lying in stock as contained in exempted final finished goodsi.e. vanaspati lying in stock as on 01.03.2005 was not available to the respondent.The finding of the Commissioner (A) is absolutely correct. Therefore, theCommissioner (A) held that the Cenvat credit on the respondent cannot be denied ondutiable final product. He further observed that the respondent can avail Cenvat crediton inputs contained in dutiable final product i.e. fatty acid. The said observation of theCommissioner (A) is absolutely correct and there is no infirmity with the same. (Para5, 6)


Krishna Electrical Industries Ltd Vs CCE (Dated: December 20, 2016)

CX - Goods manufactured by assessee have been cleared from factory to the depotfrom where they have been cleared to ultimate customer on payment of duty - Whengoods are sold through depot, there is no sale at the time of removal of goods fromfactory gate - Since the goods are not sold at the time of their clearance from factory,as per Rule 7 of CEVR, 2000, value should be normal transaction value of such goodswhen sold from depot - CX law provides for claiming refund of excise duty paid inexcess, subject to various conditions prescribed in Section 11B but assessee has goneahead and adjusted the excess duty paid with short paid duty which is not permissiblein law - Impugned order is upheld and the appeal is dismissed: CESTAT


Kesho Ram And Sons India Pvt Ltd Vs CCE(Dated: November 28, 2016)

CX - Extension of stay - Following the decision of larger Bench of Tribunal in case ofM/s Brew Force Machines Pvt. Ltd. - 2015-TIOL-1873-HC-DEL-CX-LB , it is held thatwhen delay in disposing of appeal is not attributable to assessee, extension of stay isgranted: CESTAT


CCE Vs Kay Pan Sugandh Pvt Ltd (Dated: February 16, 2017)

CX - Allegation of Clandestine removal of Gutkha - Revenue, after taking intoconsideration, the percentage quantity of raw material and packing material used inthe manufacture of one pouch of Gutkha, the number of pouches that could havebeen manufactured using the raw material found short was worked out - Comparingthis number with the average rate of production of the machines installed in the unit,it was alleged that the unit had suppressed the production of Gutka involving duty

amounting to Rs. 112.50 lakhs and clandestinely removed the same - Commissionerdropping proceedings for recovery of CE duty - Revenue appeal before CESTAT. Held:As per the Board Circular No. 81/17/2007-Cx.3 dated 19.12.2007, the units who optfor the operation under the compounded levy scheme should not be subjected toroutine inspection or search - in the instant case, by violating the Board Circular dated19.12.2007, the search was conducted and shortage of raw material was madeground for demanding the duty - The Department has converted the number of hoursinto days and months, and has calculated duty accordingly - said exercise has beencarried out for each raw material separately, assuming that gutkha can bemanufactured by using only one raw material, but the fact remains that the gutkha ismanufactured with the combination of all the raw materials - Tribunal is of of the viewthat the search was conducted against the Board Circular dated 19.12.2007 and theduty demand is based on the wrong facts - When it is so, then Tribunal finds noreason to interfere with the impugned order and the same is sustained - Revenueappeal dismissed: CESTAT [para 4, 5]


Electrocraft (India) Pvt Ltd Vs CCE (Dated: September 14, 2016)

CX - Appellant manufactures 'electric motors and parts thereof' and 'laboratoryequipment and parts thereof' some of which are supplied to research institutesentitled to duty exemption under notification 10/97-CE dated 1.3.1997 - allegationagainst appellant, who were not maintaining separate account of inputs used for bothexcisable and exempt goods and, instead of complying with Cenvat Credit Rules, 2004requiring payment of 8% of value of exempted goods at the time of clearance,(appellant) reversed credit at the end of each year – demand confirmed under section11A of CEA. HELD: Appellant has reversed the credit taken on inputs used inproduction of goods cleared under end-use exemption notification - since rule 6(3) ofthe CCR, 2004 is not applicable to appellant, reversal was the only viable optionavailable to the appellant short of refusing to supply goods to the research institutions- accordingly, the impugned order fails and is set aside – appeal allowed: CESTAT[para 8, 9]


Sri Sundaraganapathy Spinning Mills Pvt Ltd Vs CCE (Dated: September 20,2016)

Central Excise - Valuation - Denial of cash discount and trade discount given by thejob worker to the principal manufacturer.

Held: Does not appeal to common sense that how cash discount and trade discountshall be admissible to determine the value of the goods cleared by the job worker - asthe final goods are not cleared, such relief cannot be granted - any such discount shalldepress the assessable value and shall not determine the assessable value - Hence,prayer rejected - Penalty waived - Appeal partly allowed - (Para 2).


Nypro Forbes Products Pvt Ltd Vs CCE (Dated: December 8, 2016)

Central Excise - Amortization - Usage of moulds for manufacture and certain mouldssupplied by the customers are also used in manufacture by appellant - contention thatcosts of the moulds initially used were amortized and as repair costs were incurredand on regular basis, they cannot be treated as amortizable costs.

Held: No enquiry conducted by Revenue to show which are the moulds manufacturedand used by appellant involving repair cost and which are the moulds supplied by thecustomers and repair cost thereof incurred by the appellant - Nothing to suggest thatthe repair has made any value addition to the mould or substantial change to theproduct manufactured - Hence, no basis to make appellant liable in respect of the costof labour charges incurred for repairs - Appeal allowed - (Para 4).


Elecon Engineering Company Ltd Vs CCE, C & ST (Dated: December 29, 2016)

CX - Service tax paid in relation to Outdoor Catering, C&F Agent Service are coveredunder scope of "Input Services" as defined under Rule 2(l) of CCR, 2004 as held incases Ferromatik Milacron (I) Ltd 2010-TIOL-851-HC-AHM-ST, M/s Cadila HealthcareLtd 2007-TIOL-777-HC-RAJ-ST, respectively - Assessee submits that they recoveredservice charge from their employees in providing canteen service/Out door Cateringservice - For limited purpose of verification of said fact, and for reversal ofproportionate credit, matter is remanded: CESTAT


Lao More Biscuits Pvt Ltd Vs CCE (Dated: August 31, 2016)

CX - Assessee engaged in manufacture of Biscuits and availed Cenvat Credit oninputs, capital goods and Input services (GTA Service) on transport of goods by road -Assessee utilized the credit towards payment of Central Excise duty on the biscuitsmanufactured on behalf of M/s Parle Products Pvt. Ltd - Since specific agreementbetween assessee and M/s PPPL has been made which has been communicated toRange Superintendent, and the applicable excise duty on the finished goods and ST onGTA service has been paid, therefore, Revenue's appeals are devoid of merit: CESTAT


CCE, C & ST Vs Pvn Fabrics (Dated: January 13, 2017)

CX - Assessee, 100% EOU, engaged in manufacture of PP/HDPE Woven Sacks, Fabricsfalling under Chapter 39 of CETA, 1985 - During the period June 2007 to August 2008,they have availed CENVAT credit on inputs, namely, P & P Granules - Alleging thatthey have availed excess credit on CVD and also erroneous credit on Education Cessand Secondary Higher Cess, a demand notice was issued to them - In view of decisionin case of Emcure Pharmaceuticals Ltd - 2008-TIOL-226-CESTAT-MUM, assessee iseligible to avail CENVAT credit on Education Cess and Secondary Higher EducationCess, after interpreting relevant Rule 3 (7) (a) of CCR, 2004: CESTAT


Felis Leo Engineering Pvt Ltd Vs CCE (Dated: January 12, 2017)

CX - Appellant paid duty at the concessional rate available for SSI manufacturersunder Notification No. 9/2003-CE in respect of goods cleared for export throughmerchant exporter - Revenue alleged that the goods not cleared for homeconsumption cannot be cleared under concessional rate of duty under Notification No.9/2003-CE, hence demanded the differential duty – demand confirmed, hence appealto CESTAT - Appellant has argued that they were liable to pay duty @9.6% of theexport clearance in the event of failure to export the goods and also that whateverduty has been paid is available to merchant exporter as refund and, therefore, a

revenue neutral situation arises. Held: Notification would not be applicable for exportclearances - unless it is shown that the clearance challenged by the Revenue is notwithin the total permissible clearance, exemption cannot be denied, therefore, there isno merit in the impugned order – also, the Commissioner (A) has set aside thepenalty by noting that the situation is revenue neutral – impugned order set aside andappeal allowed: CESTAT [para 5]


Eveready Industries Vs CCE (Dated: November 18, 2016)

Central Excise - Issue in dispute in this appeal is whether 'waste and scrap ofbatteries' emerging out during the course of manufacture of "Dry Cell Batteries" byappellant are exempted goods and whether appellant is liable to pay amount in termsof Rule 6 (3) (i) of Cenvat Credit Rules, 2004, or otherwise.

Held: The issue stands covered by the decision of Allahabad Bench of the Tribunal inappellant's own case vide Final Order No.70280-70281/2016 dt. 1.6.2016 held infavour of the appellant - The case is also supported by ratio of Hon'ble Allahabad HighCourt's decision in the case of Balrampur Chini Mills Ltd. Vs UOI


CCE & ST Vs Greenply Industries Ltd (Dated: August 12, 2016)

CX - Adjudicating authority has held assessee to be eligible to the benefit of Notfn32/99-CE - Benefit given for carrying out more than 25% expansion in the installedcapacity of plywood production - While examining and allowing expansion foradmissibility of the notification, the process of manufacture was observed - Copy oforder sent to the jurisdictional Commissioner but there is no evidence on record thatsaid order was reviewed by the department - Once an issue is decided by an orderand not reviewed by the appropriate authority then the same becomes final - Secondproceeding cannot be initiated on the same cause of action in the absence of anycontrary evidence or expert opinion: CESTAT


CCE & ST Vs ND Metal Industries Ltd (Dated: January 24, 2017)

CX - Assessee has been manufacturing recycled PVC granules which fall underChapter 39.04 to 39.14 - They have been manufacturing said items out ofscrap/waste generated from copper wire/cable which fall under Chapter 85 of FirstSchedule to CETA, 1985 - As per Institute of Scrap Recycling Industry, INC,Washington, it has been explained that copper scrap druid is a waste/scrap material ofcopper wire/cables having various types of insulations including plastic and therefore,the same falls under Chapter 85 - If it is so, then there is no discrepancy or anomalyin impugned order passed by Commissioner (A) - Impugned order sustains and appealfiled by Revenue has got no merits and is hereby rejected: CESTAT


Dodsal Pvt Ltd Vs CCE (Dated: February 16, 2017)

CX - Letters issued by Jt. Commissioner / Additional Commissioner, Central ExciseRecovery, Mumbai I Commissionerate to appellant communicating certificate issuedu/s 142 of Customs Act, 1962 for recovery of dues arising in Bangalore

Commissionerate are not appealable - Appeal dismissed: CESTAT [para 5]



Welspring Universal Vs CCE (Dated: January 10, 2017)

CX – CENVAT credit taken reversed by appellant along with interest –Commissioner(A) reducing penalty on partner to Rs.5 lakhs from Rs.20 lakhs and onappellant to 25% - appeal to CESTAT for setting aside penalty imposed on partner onthe ground that since the duty involved, interest payable as well as 25% penalty hasbeen paid within one month from the date of issue of show cause notice, it is to bedeemed that the entire proceedings initiated are concluded. Held: CBEC circular11/2016-Cus dated 15.03.2016 clarified that when the notice pays up the entire duty,interest and penalty, under such circumstances the proceedings shall be considered asclosed not only against the noticee but also against the other persons to whom anydemand of duty is envisaged but on whom penalty might have been imposed - Sincesection 11A under which present notice has been issued is pari materia to section 28of the Customs Act, a similar benefit would be extendable to the appellant and partner– penalty imposed on partner is waived – appeals disposed of: CESTAT [para 7, 8]


Pioneer Jellice India Pvt Ltd Vs CCE & ST (Dated: December 5, 2016)

Central Excise - Disallowance of credit of service tax on transportation during removalof goods and denial of credit for the reason that the documents are not in the name ofthe appellant company but issued in the name of the head office.

Held: Regarding the issue of eligibility of service tax paid on transportation, thetribunal on identical issues has referred appeals for denovo adjudication to reconsiderbased on the guidelines of Boards Circular - Hence, the said matter is remanded tothe adjudicating authority - Regarding availment of cenvat credit, the invoice is to beissued by the input service distributor and is required to be a registered person - billsrelated to the construction of wall and construction of worker's rest room has nonexus between the services availed at outside place at Erode ad the manufacturingactivity at Cuddalore - The services availed have no nexus with the manufacturing orbusiness activity of the appellants - Hence, this part of the appeal on disallowance ofcredit is sustained and the appeal is rejected - (Para 4, & 5).


Western Railway Printing Press Vs CCE (Dated: January 23, 2017)

CX – COD application filed for delay in filing appeal – Applicant submits that thematter of payment of pre-deposit of 7.5% duty for filing appeal was pursued withdifferent levels for getting approval of HOD after which the same was paid. Held:Appellant is a department of Government of India, Ministry of Railways and thereasons stated is found to be genuine as this are usual things in the Governmentdepartment to delay the process after crossing various levels of the Governmentdepartment - Considering the overall circumstances for delay, COD applicationallowed: CESTAT [para 4]


Kinnari's Pad Flex Vs CCE (Dated: January 13, 2017)

CX –Revenue before CESTAT against the order of Commissioner (Appeals) dated22.12.1999 dropping the demand on limitation – consequently, the assessee filingrefund claim which was sanctioned – against the refund order, on appeal by revenue,Commissioner (Appeals), vide order dated 6.7.2000, setting aside the refundsanctioned – assesseealso before CESTAT. HELD:From the findings of order dated22.12.1999, it is very clear that assessee was maintaining RG 23D register andissuing invoices in respect of repacking and relabeling of goods and same was beingsubmitted to the department – Commissioner (Appeals) holding that there is nosuppression of facts on the part of the assessee and dropping the demand of extendedperiod – no infirmity found in this order of the Commissioner (Appeals) –Commissioner (Appeals), vide order dated 6.7.2000, should not have allowed theappeal of revenue for the reason that order of Commissioner (Appeals) itself dated22.12.1999 for dropping the demand was prevailing at that time – for this reason,order reversing the sanction of refund claim was illegal – order of the Commissioner(Appeals) dropping the demand is maintained – appellant is legally entitled for refundand whatever refund has been granted will stand intact - revenue's appeal dismissed,and assessee's appeal allowed: CESTAT [para 5]


CCE Vs Hindustan Lever Ltd (Dated: February 6, 2017)

CX – ROM filed by Revenue submitting that the names of the products have beenwrongly mentioned in paragraphs 1 and 4 of the final order dated 31.10.2016 [ 2016-TIOL-3133-CESTAT-MUM ] inasmuch as the correct names are Chicken Broth Powder,Bestfood Marinara Sauce, Bestfood Barbecue Sauce, and Bestfood Italian MayonnaiseSauce. Held: Mistake pointed out by the Revenue appears to be correct, however, theissue of classification has been settled in Tribunal's earlier order dated 06.03.2007cited as - 2007-TIOL-2022-CESTAT-MUM – therefore, mistake does not affect theTribunal's order dated 31.10.2016 – Order rectified and ROM application allowed inabove terms: CESTAT [para 2, 4]


Insecticides (India) Ltd Vs CCE (Dated: September 21, 2016)

CX - Assessee engaged in manufacture of insecticides and pesticides - They alsomanufactures Zink micro nutrients and bio-fertilizers falling under Chapter 58 & 31respectively of CETA, 1985 which are nil rated / exempted from payment of duty - Itis found that assessee had reversed the amount from cenvat account on 15.09.2006on input services attributable to exempted goods removed from factory - Since, it isnot a case for reversal of 10% of amount, and assessee upon proper maintenance ofrecord has reversed the proportionate credit and also paid interest amount, there isno need of remanding the case to original authority for verification of cenvat records,which were verified by original authority - Since Rule 6 was amended retrospectively,benefit contained therein should also be available to assessee - Impugned order setaside and appeal allowed: CESTAT


CCE & ST Vs Magnacore (Dated: November 30, 2016)

CX - Dispute relates to assessable value of goods, when same were admittedlymanufactured by assessee on job work basis and in terms of provision of Rule 4 (5) ofCCR - Revenue in their memo of appeal has reiterated that decision rendered incontext of rule 57F(4) would not be applicable in respect of provisions of Rule 4(5) ofinasmuch as they are not pari materia - Revenue, however is silent on issue as to how

the same are not pari materia and as to how the Tribunal decision in case of GayatriTextiles, which hold both the Rules are pari materia would not be applicable -Commissioner (A) has rightly relied upon the Tribunal and Supreme Court's decisionand has rightly extended the benefit to the assessee: CESTAT


Auto Valves And Engine Components Ltd Vs CCE (Dated: February 28, 2017)

CX – Undertaking in terms of 214/86-CE is not merely procedural but substantive asby virtue of the same, the principal manufacturer takes the responsibility of dutyliability in case it arose - processes carried by appellant result in a substantial advancestage of manufacture of valves and, therefore, the argument that there is no activityof manufacture, has no merit – demand upheld – appeal dismissed: CESTAT [para 5,6]



Tamin Granites Vs CCE (Dated: January 3, 2017)

Central Excise – Duty demand of Rs 7,42,297/- challenged in appeal – Held that notproductive to invest time as there is huge pendency involving crores of rupees –appeal with a minor demand of duty levied is dismissed.


Southern Petrochemical Industries Corporation Ltd Vs CCE & ST (Dated:November 18, 2016)

Central Excise – Appellant sold "Carbon-di-oxide" emerged in the course ofmanufactureto a related bulk buyer M/s. TAC and to M/s. SICGIL – appellant submitsthat even though TAC was connected with the appellant there was no depression tothe assessable value of the carbon-di-oxide cleared to them – sold to both the partiesin different conditions and quantities – revenue did not find out if there was differentrate in market in respect of similar goods.

Held: No arrangement between the parties to dispose major chunk of the product infavored terms - assessable value was not compared with market value prevailing inrespect of same goods in similar condition in the same market by any enquiry – inabsence of comparison difficult to appreciate that the appellant had adopted a lowerassessable value for clearances made to TAC with an intention to evade duty – Hence,Appeal allowed – (Para 4).


Precision Equipment (Chennai) Pvt Ltd Vs CCE (Dated: November 18, 2016)

Central Excise - Issue in appeal relates to credit availed availed by the appellant(Unit-I) in respect of input services which was provided to both Unit-I & Unit-II of theappellant - Department has denied entire credit amount availed solely by Unit-I -Appellant is not eligible to take such full tax credit since some part of the credit ofservice tax relates to Unit-II also.

Held: definition of "input service distributor" in rule 2 (m) also encompasses eitheroffice of the manufacturer of final products or provider of output service for thepurpose of distributing credit of service tax paid - not having a ISD registration inrespect of credit availed and distributed such credit otherwise eligible is curable defect- appellant has not taken double credit which has been also simultaneously availed byother unit and in any case it relates to very much to their own company – Appealallowed – (Para 4).


L G Balakrishnan And Bros Ltd Vs CCE (Dated: February 2, 2017)

Central Excise – Issue is whether GTA service availed to deliver the output at thebuyer's place be construed as input service.

Held: Based on the judicial pronouncements, service of GTA availed before 1.4.2008shall be input service according to the term upto the place of removal used in Rule2(l) of CENVAT Credit Rules, 2004 – Hence, appeal allowed – Misc application standsdismissed as that was seeking for extension of interim order of stay.


India Oil Corporation Ltd Vs CCE (Dated: December 2, 2016)

Central Excise – Manufacture of 18 Gauge lube barrels, 20 Gauge Lube Barrels, 24Gauge Bitumen drums – Sent to other manufacturers for packing lubricants and fillingbitumen which are captively consumed – Adopted 100% cost of production forpayment of excise duty and opted for provisional assessment and paid dutyprovisionally – The total differential duty arrived was paid provisionally – originalauthority confirmed short-payment along with interest and commissioner (A) rejectedthe appeal – Hence, the present appeal.

Held: The matter has been squarely covered by the ratio laid down by Hon'bleKarnataka in the case of Toyota Kirloskar Auto Parts Pvt. Ltd. – It held that after thefinal assessment order is passed if the duty paid in the entire scheme of Rule 7, thereis no indication that when an asseseee is permitted to pay duty in pursuance of aprovisional assessment order, if he is dealing with more than one goods, suchassessee has to be treated separately - there is no short fall in payment of duty afteradjusting excess payment on other products, interest liability will not arise – Appealallowed – (Para 4, & 6).


Huawei Telecommunication (India) Company Pvt Ltd Vs CCE (Dated: July 22,2016)

Central Excise – Recovery of Anti-Dumping Duty – Appellant was directed to pay anti-dumping for clearances effected after august 2010 when the provisional levy hadceased to have effect but made retrospectively leviable in the final notification dated16th December 2010 – As the appeal was rejected by the Commissioner (A), Chennai,appellant thus filed the present appeal – Claims to have complied under protest toavoid further holding up of consignment.

Issue: Scope of levy of 'anti-dumping duty' on clearances from a special economiczone and the jurisdiction to levy during the inter regnum between the expiry of a

provisional levy and imposition of final levy.

Held: Units within a Special Economic Zone are permitted to procure inputs andservices domestically or from outside the country free of payment of duty with intentto garner convertible foreign exchange through exports of goods or services - Being aself-contained legislation, Special Economic Zones Act, 2005 itself provides forexemption from, and for levy of, duty - Section 26 therein grants exemption from allduties of customs, excise, service tax and central sales tax on imports and domesticprocurement of goods or services - With the charging provisions embodied in theSpecial Economic Zones Act, 2005 prevailing over the provisions of Customs Act, 1962and a detailed procedure prescribed in Special Economic Zones Rules, 2006 theapplicability of Customs Act, 1962 and rules thereunder is limited to the determinationof rate of duty, applicability of exemption notifications and valuation of the goodswhich are not provided for, but referred to, in the Special Economic Zones Act, 2005 -the Customs Act, 1962 and Customs Tariff Act, 1975 cannot be invoked in relation togoods cleared into the domestic tariff area (DTA) - Nevertheless, section 30 of SpecialEconomic Zones Act, 2005 specially includes ‘anti-dumping duty' as chargeable onclearances into the domestic tariff area (DTA) and thus directly invites applicability ofsection 9A of Customs Tariff Act, 1975 – first appellate authority failed to examine therecords to ascertain if the goods cleared to the appellant did match the description inthe ‘anti-dumping' notification with the special economic zones as a mere stagingplace for removal into the domestic tariff area (DTA) – bill of entry filed wouldevidence that ‘anti-dumping duty' had been foregone at the stage – if the same goodshave been cleared as such against a bill of entry into the domestic tariff area (DTA)the levy of ‘anti-dumping duty' would be correct in law – In view of the ruling of theHon'ble Supreme Court in GM Exports, nothing survives in the action initiated by theauthorized officer of the Special Economic Zone – Appeal allowed – (Para 6–11).


Nirma Ltd Vs CCE (Dated: January 13, 2017)

CX - The assessee is a manufacturer of pharmaceutical products - Reversal of CENVATcredit were made on the inputs used in the manufacture of finished goods which weredestructed being unusable and remission of duty on such finished goods was allowed -later a show cause notice was issued for recovery of interest on the reversed CENVATcredit amount - Tribunal do not find any stipulated therein, requiring assessee toreverse the interest on amount of CENVAT credit availed on inputs that were used inmanufacture of finished goods allowed to be destroyed after permitting remission ofduty under Rule 21 of CER, 2002: CESTAT


Ghodawat Foods India Ltd Vs CCE (Dated: September 1, 2016)

CX – Manufacture – Section 2(f) of CEA, 1944 - Whether the repacking of RBBPalmolien Oil received in tanker in bulk and repacking them into smaller packs duringOctober 2003 will amount to manufacture and liable to duty or otherwise. HELD :Issueis no more res integra - this Tribunal in a similar set of facts, in the case of Anwar Oils- 2015-TIOL-2837-CESTAT-MUM held in favour of the assessee - impugned order isset aside and appeal is allowed with consequential relief: CESTAT [para 4]


CCE Vs Gangeshwar Spinning Mills (Dated: November 29, 2016)

CX - It is alleged that assessee have violated the condition of Notfn 22/2003-CE -

There have been substantial compliance of conditions of Notfn 22/2003-CE , whichrequired that duty-free capital goods acquired by 100% EOU should be utilised by itfor manufacture of goods, which are finally exported - Accordingly, there is no errorfound in O-I-A passed by Commissioner (A), hence the appeal filed by Revenue isdismissed: CESTAT


GK Winding Wires Ltd Vs CCE (Dated: November 18, 2016)

CX - Assessee are manufacturer of Copper Winding Wires and received back some oftheir products cleared, being defective, for rectification or remaking - All thetransactions of receiving back the defective goods and removal of part of the same asscrap have been duly recorded in the ordinary course of business in the Books ofAccounts maintained - After receiving back the defective goods the same aresubjected to inspection and testing before the same is rendered as scrap and removed- SCN is hit by provisions of this section 11A Sub-section 2 of CEA, 1944 whichprovides that wherein assessee on his own ascertainment, or on being pointed out byCentral Excise Officer, deposits the differential duty or duty short paid underintimation to the authority, then no SCN was required to be issued: CESTAT


CCE Vs Cooper Pharma (Dated: March 10, 2017)

CX - Valuation - Section 4 of CEA, 1944 - Respondents computed duty liability basedon a published article under a bonafide belief that it is correct interpretation of law -view of Commissioner(A) that demand can be sustained only for the normal period oflimitation cannot be faulted - since valuation has been arrived at on the basis ofinvestigation report which has not been shared with the respondent during the courseof the adjudicating proceedings and witness has also not been made available forexamination by the respondents, demand cannot be sustained - Denovo ordered forre-computing demand of Rs 16,59,090/- for normal period, penalty u/r 25 of CER,2002 imposable : CESTAT [para 5, 6, 7, 8, 12]



GR Sponge And Power Ltd Vs CCE (Dated: November 1, 2016)

Central Excise - Sponge Iron manufacture -Cenvat credit on capital goods such asplates, angles, channels, welding electrodes as well as Oxygen gas used within thefactory or in relation to the manufacture of the final product - Allowed - Impugnedorder denying the credit on said goods set aside. (Para 5-7)


Godrej And Boyce Manufacturing Company Ltd Vs CCE (Dated: November 28,2016)

CX -CENVAT - It is undisputed that when the goods i.e. painting system and partsthereof were cleared by M/s. Thermax Surface Coatings Ltd., the said classificationwas under CH 84.79 of the CETA for which modvat credit was available to theappellant - subsequent change of classificationby the adjudicating authority to CH84.24, cannot be held against the appellant for invoking the extended period anddenying the said modvat credit as the duty paying documents were indicating the

Chapter Heading for which cenvat/modvat credit was available -in the absence of anyevidence to indicate that appellant was aware of the classification dispute which wasbeing agitated before the authorities by M/s. Thermax, invoking of extended periodfor demanding/reversing the modvat credit availed by the appellant is not inconsonance with the law - impugned order unsustainable and liable to be set aside -order passed by adjudicating authority is correct and is restored - appeal allowed :CESTAT [para 5, 5.1, 6]


Kali Aerated Water Works Vs CCE & ST (Dated: December 22, 2016)

Central Excise – Denial of SSI benefit – Appellant claims it was the owner of the brandname of "Kali Mark”, "Bovanto” and "Club Soda” who cleared the goods with suchbrand names – Revenue agrees with the law laid down by the apex court in thedecision cited by appellant.

Held: the clearances made with such brand name shall not dis-entitle the appellant tothe SSI benefit - So far as the other two brand names cited above is concerned, thereis no material to suggest that those two brand names were owned by any otherperson - appellant is also not dis-entitled to SSI benefit in respect of clearances madeunder those brand names – Appeals allowed – (Para 4).

Documents

CESTAT RULING (CENTRAL EXCISE) · 2018. 10. 2. · Hritik Exim Vs CCE (D ated: October 26, 2016) CX - Refund - The assessee has not paid ST on sales commission agents service for