cestat ruling (central excise)taxindiaonline.com/.../excise/cestat2017.pdf · 2018. 10. 2. ·...

CESTAT RULING (CENTRAL EXCISE)

2017-TIOL-395-CESTAT-MUM

Indo Built Storage Systems Pvt Ltd Vs CCE (Dated: December 20, 2016)

CX - Appellant, after clearance of their own manufactured goods to the site of thecustomers get the storage system erected and installed at site by assigning the workto outside contractor - SCN issued demanding duty on the expenditure incurred for theerection and installation on the ground that the said activity is also a part ofmanufacture - demand confirmed and upheld by Commissioner(A), so appeal toCESTAT. Held: If at all the activity at site amounts to manufacture and if it is liable forduty, it should have been demanded from the manufacturer of storage system as thesaid activity is carried out by sub-contractor - therefore, appellant cannot be treated asmanufacturer of storage system - In the peculiar facts and circumstances of the case,duty demand confirmed against appellant is incorrect and illegal - impugned order setaside and appeal allowed with consequential relief: CESTAT [para 5, 6]


Indoco Remedies Ltd Vs CCE (Dated: December 20, 2016)

CX - Issue is whether the tooth paste namely Sensodent-K and Sensodent-KF havingactive ingredient namely Potassium Nitrate is classifiable under Chapter 3003.10 or astooth paste under sub-heading 3306.10. Held: Product is in the form of toothpaste butit is for special need and marketed as use for sensitive teeth - For that purpose, themain ingredient is Potassium Nitrate, therefore, it is different from the normaltoothpaste - In view of the settled legal position involving similar products, in view ofthe decision in SPA Pharmaceuticals Pvt. Ltd - 2004-TIOL-373-CESTAT-MUM , theproduct is rightly classifiable under sub heading 3003.10 - impugned order is set asideand appeal is allowed: CESTAT [para 4]

2017-TIOL-393-CESTAT-HYD

Jindal Saw Ltd Vs CCE (Dated: September 20, 2016)

Central Excise - Penalty under Sec 11AC - Inter unit transfer of capital goods -Removal took place in July 2011 and, appellant paid some duty amount in thebeginning of July 2011 and the balance duty was paid in the end of the very samemonth, i.e., July 2011, when the liability to pay duty/reverse the credit availed aroseon appellant. Hence, there is neither suppression nor delay in making payment of dutyand so imposition of penalty u/s. 11AC is unjustified.

Appellant transferred capital goods in July 2011 on payment of duty - Revenue tookview that initially appellant short paid the duty and only after pointing out byDepartment, paid full duty and as such there was delay in payment of duty and soimposed penalty - From perusal of appellant's submissions and various dates ofpayment made as per SCN, it is seen that appellant has made a payment of Rs. 4.41lakhs in the beginning of July 2011 and the balance duty Rs. 54.25 lakhs was paid inthe end of the very same month - Re-transfer of capital goods took place in the verysame month by which the liability to pay duty/reverse the credit availed arose onappellant - Moreover, from the records it is clear that there is neither suppression nordelay in making payment of duty - Hence, imposition of penalty u/s. 11AC is totallyunjustified - Appeal allowed. [paras 3, 4, 5]

2017-TIOL-392-CESTAT-DEL

Jaypee Rewa Plant Vs CCE & ST (Dated: December 26, 2016)

CX - Issue relates to denial of cenvat credit on various steel items used for

fabrication/manufacture of various capital goods installed in factory - Period of disputeis from April, 2008 to September, 2008 - Explanation 2 appended to definition ofinputs in Rule 2 (k) ibid provided that goods used in manufacture of capital goodswhich are further used in factory of manufacture, should fall within the ambit of inputfor purpose of availment of cenvat credit - However, said explanation was amendedvide Notfn 16/09-C.E.(N.T.) - Since disputed goods were procured prior to date ofamendment of Rule 2 (k) ibid, cenvat benefit on disputed goods cannot be denied toassessee - Therefore, impugned order is set aside: CESTAT


CCE Vs K P Pouches Pvt Ltd (Dated: February 3, 2017)

CX – Department has adopted a short cut method by demanding the duty on the entire63,346 bags containing gutka reflected in the 13 unloading registers and gate registerswhen the fact remains that the assessee is responsible to pay the duty on its trademarked stock only and is not responsible for payment of CE duty on brands notmanufactured by them – department has not checked the manufacturing capacity ofthe assessee and also the vouchers at the time of booking the gutka from Delhi - Noattempt was made by the department to examine the records of the manufacturers ofgutka bearing brands Goa 1000/Talab/Kuber and Moolchand etc. - AA has correctlydemanded duty only in respect of gutka bearing the brand name of "Rajshree" and"Safal" which belong to assessee and contained in 2404 bags – no reason to interferewith order passed by AA - Revenue appeal dismissed: CESTAT [para 6, 7]

Also see analysis of the order


Coach Classic Vs CCE (Dated: January 4, 2017)

CX - M/s Shearling Skins Pvt. Ltd. engaged in manufacturing and trading of officefurniture which requires lot of space - All the machines for purpose were found inpremises of M/s Coach Classic - The address for M/s Shearling Skins Pvt. Ltd. wasshown at RZ 2679/28 Tughalkabad Extension, New Delhi, a rented shop having size of8x6 sq.ft. - No factory or office can run from this premises/shop especially when it wasnot used since long - Employees of M/s Coach Classic i.e. S/Shri Sarabjeet Singh @Mannu and Gulshan Bindra stated that both the business entities are, in fact, run byShri Puneet Singh Sheera - Actual business entity is M/s Coach Classic and itsproprietor has formed a dummy company in name and style of M/s Shearling SkinsPvt. Ltd. by showing its manufacturing unit just to have SSI Exemption - Clearancesare correctly liable to be clubbed for both business entities as per SSI Exemption Notfn8/2003-CE - No reason to interfere with impugned order and same is herebysustained: CESTAT

2017-TIOL-386-CESTAT-ALL

CCE Vs Aswad Steels And Alloys Pvt Ltd (Dated: November 8, 2016)

CX - Related person - If the goods are cleared to a person who is consuming the same,then the provisions of Rule 9 are not applicable - In the present case, SCNs hasinvoked Rule 11 and for invoking Rule 11, it has taken assistance of provisions of Rules8 & 9 of said Rule - Neither the provisions of Rule 8 nor the provisions of Rule 9 areapplicable - Therefore, SCNs are not sustainable: CESTAT

2017-TIOL-385-CESTAT-KOL

CCE Vs Shri Badrinarain Alloys And Steels Ltd (Dated: September 8, 2016)

Central Excise – MODVAT Credit - The issue involved is whether Modvat Credit isadmissible on capital goods installed and commissioned on 16.09.1997 whenrestricting clause got inserted in Table to Rule-57Q(1) under Notification No.33/97-C.E.(N.T.) dated 01.08.1997 - It is the case of the Revenue that on the date of

installation compounded levy scheme was applicable to appellant, therefore, capitalgoods credit is not admissible and even if it was admissible prior to 16.09.1997 thesame is deemed to have lapsed by virtue of Rule 57S(11) of the Central Excise Rules,1944.

Held: Amendments/insertions to Sr.No.1 of Table to Rule 57Q(1) and Rule 57 S(11)were made simultaneously under Notification No. 33/97-C.E.(N.T.) dated 01.08.1997 -intention of the legislature behind the amendments was not to allow credit on capitalgoods if received by an assessee, who is paying duty on Iron and Steel finished goodsunder compounded levy scheme as per Section 3A of the Central Excise Act, 1944; andas per Rule 57 S (11), if any, credit is lying unutilised the same shall lapse - FirstAppellate Authority has relied upon Apex Court decision in the case of Eicher MotorsLtd. vs. Union of India, which was delivered when Section 37(1) (xxviii) was notexisting - It was introduced in the Central Excise Act, 1944 as per Sections 131 and132 of the Finance Act, 1999 with retrospective effect [Para 7, 8]

The intention of the legislature was not to allow Modvat credit with respect to capitalgoods during the period of compounded levy or if any credit is lying unutilised beforethe compounded levy period the same shall lapse - The ratio laid by Bombay HighCourt in para- 34,35 and 36 of case law Coral Cosmetics Ltd. vs. Union of Indiasquarely applies to the existing facts - Reliance placed by the respondent on the caselaw Nahar Industrial Enterprises Ltd. vs. CCE, Chandigarh will not be of any help to therespondent as lapsing clause was not existing in Notification No.19/2000 dt.01.03.2000 and has not been discussed so by the Tribunal - In view of the settledproposition of law Cenvat Credit has been wrongly allowed by the First AppellateAuthority, and is set aside. [Para 9, 10, 11]


Perfect Boxes Pvt Ltd Vs CCE & ST (Dated: November 4, 2016)

CX - Assessee's factory was sold to M/s. Unwin Packaging on 27.06.2005 - However,registration certificate continued to be in name of assessee until the date of itssurrender with Department on 29.03.2006 - The dispute is with reference to the periodin between two dates given - There is no whisper of any evidence alleging that Cenvatcredits were taken inappropriately - Only allegation is that the credits have been usedfor making payments for finished products which have not been manufactured inassessee's factory - Assessee has admittedly got the goods manufactured on job workbasis in its sister concern in terms of Notfn 214/86-CE - Demand for reversal of Cenvatcredit is not justified.

Demand has been raised by mechanically invoking the proviso to Section 11A of theAct - There is no discussion or even a murmur of any evidence or allegation thatassessee has indulged in act of suppression of facts or wilful mis-statement,contravention to provision of said Rule - In absence of any of ingredients, there can beno justification to invoke extended period of time for issuing demand - Impugned orderset aside and appeal allowed: CESTAT


Caparo Engineering India Pvt Ltd Vs CCE (Dated: January 24, 2017)

CX - Valuation - section 4 of CEA, 1944 - Operational compensation recovered fromcustomer for non-lifting of the goods produced is not towards the sale or supply ofgoods and is, therefore, not includible in AV - impugned order set aside and appealsallowed: CESTAT [para 12 to 14]



JK Tyre And Industries Ltd Vs CCE & ST (Dated: November 25, 2016)

CX - Assessee engaged in manufacture of nylon tyres - They were also engaged inmanufacture of dipped rubberized cord fibre of high density nylon yarn in factory,which is captively used in manufacture of nylon tyres - Assessee claimed exemptionunder notfn 67/95-CE for captively consumed goods - Product is having shelf life and isalso being transported as evidenced from the assessee's own declarations - Length ofshelf life is immaterial as long as it can be established that product has got identify andis capable of being marketed - Actual sale of such product need not be established ineach case - It has been clearly shown that the product has been actually transportedby road by assessee on payment of duty for being used several kms away formanufacture of excisable goods - This will indicate that product will not be onlyclassifiable as distinct commodity but is also capable of being transported by road longdistance and capable of being bought and sold - As assessee is held liable to pay dutyon dipped rubberized fabrics manufactured by them in their factory, they are rightlyeligible for modvat credit of duty paid on inputs used in such manufacture - Noallegation of any intentional contravention of provisions of law has been alleged ordiscussed by lower authority, hence, imposition penalty is not justifiable and cannot besustained: CESTAT


Facor Alloys Ltd Vs CC & CE (Dated: October 7, 2016)

Central Excise - CENVAT Credit - Definition of capital goods includesspares/components/accessories of capital goods specified under Chapter 82, 84, 85, 90of Central Excise Tariff Act, 1985 - From the description, details of usage andclassification, it is clear that the impugned goods, i.e., conveyor belt, circular bottomplate, rubber goods, steel wire ropes, wire woven mesh are spares/parts of capitalgoods - Moreover, adjudicating authority have allowed credit on all the impugneditems for earlier periods - Hence, credit is admissible on impugned items for the periodFeb'-Mar', 2010 - Appeal allowed. [paras 3, 6, 7, 8]


Hetero Labs Ltd Vs CCE & ST (Dated: October 27, 2016)

Central Excise – CENVAT Credit – MS items were used in fabrication of supportstructure used as basement for reactors-capital goods and for laying pipelines andbridges for connecting solvent yard and reactors and the period involved is prior to7.7.2009 – Various precedents have held that during the demand period, credit isadmissible on MS items used for fabricating structural support to capitalgoods/machines since without such support the machines cannot be used withoutvibration and on MS items used in fabricating capital goods – Hence, denial of credit onimpugned MS items is not sustainable – Appeal allowed . [paras 3, 6, 7]

2017-TIOL-377-CESTAT-BANG

Hindustan Glass And Industries Ltd Vs CCE (Dated: September 27, 2016)

Central Excise - CENVAT Credit reversed suo moto reversed - demand of interest andpenalty - It is settled law that the appellants are not liable to pay interest as well asthe penalty when credit is reversed before utilization - On the plea that the appellantare eligible for credit on one of the items, matter remanded for verification. (paras 5 &6)


CCE Vs Hutchison Max Telecom Pvt Ltd (Dated: December 20, 2016)

CX - Whether erection/installation of transmission tower at site is liable to excise dutyor otherwise - Lower authorities dropped demand based on the decision on identicalissue delivered in case of BPL Mobile Communication & Ors. - 2005-TIOL-923-CESTAT-

MUM - Revenue in appeal before CESTAT. Held: Bombay High Court in the case ofHutchison Max Telecom P Ltd - 2007-TIOL-809-HC-MUM-CX has upheld the order ofthe Tribunal - Revenue appeal is, therefore, dismissed: CESTAT [para 3, 4]


Sri Warana Shahakari Dudh Utpadak Prakriya Sangh Ltd Vs CCE (Dated:January 27, 2017)

CX - CENVAT - Rule 7(1)(b) of CCR, 2002 - M/s Lotus paid differential duty alongwithinterest before issuance of SCN - in terms of s.11A(2B) of CEA, 1944, no SCN shouldhave been issued - penalty imposed u/s 11AC dropped by Commissioner(A) and orderaccepted - Supplementary invoice issued even for extended period is, therefore, validdocument for taking credit: CESTAT [para 5]



Shree Pandurang Ssk Ltd Vs CCE (Dated: December 7, 2016)

CX - CENVAT - Restriction in availing credit if depreciation is availed is only in respectof capital goods and not on services - on the ground that service on which credit istaken was capitalized and depreciation was claimed is in violation of rule 4(4) of CCR,2004 and, therefore, is not admissible, is untenable - Impugned order set aside andAppeal allowed: CESTAT [para 5]



Electropneumatics And Hydraulics (India) Pvt Ltd Vs CCE (Dated: January 6,2017)

CX - Whether the amount reversed under rule 6 of CCR and recovered the same fromcustomer can be demanded u/s 11D of CEA, 1944. Held : Amount which ispaid/reversed in terms of Rule 6(3)(b) of CCR is not a payment of excise duty -Section 11D can be invoked only in case where excise duty was recovered and thesame was not paid to the government exchequer - Since the amount paid u/r 6(3)(b)is not excise duty, therefore, Section 11D is not applicable – impugned order set asideand appeal allowed: CESTAT [para 5]


Dalmia Chini Mills Vs CCE (Dated: November 18, 2016)

CX - Whether assessee is entitled to Cenvat credit on the cement used in thefoundation of machineries erected which have been further used for manufacture oftaxable or dutiable products - appellant is engaged in the manufacture of Cane Sugar,Molasses & Ethyl Alcohol and taken Cenvat credit of inputs used in the foundation ofvarious machinery and/or supporting structures - Commissioner (A) have erred inrelying on ruling of Rajasthan High Court in case of Hindustan Zinc Limited as saidruling was in respect of CCR, 2002 which have been replaced by CCR, 2004 - Inputsare not necessarily to be used in manufacture of final products, as an input may beused even in relation to manufacture of final product - Cement and Iron & Steel usedin supporting structure for erection of plant & machinery are eligible as inputs: CESTAT


Askas Plastics Pvt Ltd Vs CCE & ST (Dated: June 23, 2016)

CX - Assessee engaged in manufacture of Polythene Bags and Sheets - Dispute relatesto availment of Cenvat credit on inputs namely, Plastic Granules for period October'2005 to Dec' 2007 - Demand is made on the basis of records and statements ofemployees/ Director of M/s Signet Overseas Ltd. - Documents/ records relied upon byrevenue pertain to M/s Signet Overseas Ltd. have not been corroborated from anyindependent evidences - Though it is alleged that assessee firm paid amounts throughcheque and in turn took cash from M/s Signet Overseas Ltd., it is found that noevidence is appearing on record which can show aassessee's involvement in suchtransactions - Therefore, demand cannot be made against assessee merely on basis ofthird party records - In absence of any investigation to that effect, Tribunal views thatgoods were received by assessee unit - Confirmation of demand and imposition ofpenalty by authorities below are not justified: CESTAT


Biyani Dyeing And Printing Mills Pvt Ltd Vs CCE (Dated: October 26, 2016)

CX - Clandestine manufacture and removal of processed man made fabrics and sarees- Assessee engaged in manufacturer of processed man made fabrics also known assynthetic fabric - Findings of clandestine removal arrived at by lower authorities, arebasically dependent upon recovery of certain loose slips from residential premises ofDirector, Shri B.K. Biyani - There is absolutely no concrete evidence on record toreflect upon clandestine activities of assessee - No statements of workers wererecorded and no identification of transporter or buyer to whom alleged clandestinelyremoved goods were sold, was made - Revenue's case is based upon recovery of someloose papers from common residence of Director and cannot be held to be madeevidence for arriving at the findings of clandestine removal. - Entire case of Revenue isbased upon assumptions and presumptions - Accordingly, impugned order is set asideand both the appeals are allowed: CESTAT


Bharat Heavy Electrical Ltd Vs CCE (Dated: August 31, 2016)

Central Excise - Goods cleared for erection of Mega Power Plant - Domesticmanufacturer need not fulfil conditions prescribed for importer: Once the Revenuedoes not dispute that the assessee is a domestic manufacturer, then assessee has tosatisfy only one of those conditions, particularly that the supply must be of goods inrelation to contracts awarded under international competitive bidding procedure, thenthat condition is squarely satisfied. The condition such as Condition No.29 whichpertains to an importer of the goods need not be, in the given facts, satisfied by thedomestic manufacture, and that is the conclusion reached by the Tribunal. - para 8


CCE Vs Atul Plywood Pvt Ltd (Dated: November 25, 2016)

CX - A llegation of clandestine removal has been based on some invoices which arealleged to be parallel invoices and production slips for the month of October, 2005 -However, no evidence has been brought on record to show that these invoices wereactually used and goods mentioned therein were actually delivered to recipients -Thus, investigation has failed to establish evidential value of these document with thehelp of corroborative evidence to support clandestine production and removal - Thereis no reason to interfere with impugned order: CESTAT


Bhilai Engineering Corportion Vs CCE (Dated: December 23, 2016)

CX - Assessee is availing benefits of Cenvat Credit Rules and also availing the benefitsof DEPB r/w exemption granted under Notfn 34/97-Cus and 45/2002-Cus - Under the

Foreign Trade Policy 2002-07 itself, the issue whether Cenvat credit can be permitted,when CVD is paid using the DEPB was very much disputed by different benches ofTribunal and held differently - Matter was finally resolved by decision of larger bench ofCESTAT in case of Essar Steel Ltd. 2004-TIOL-807-CESTAT-DEL-LB - Consequently,allegation of suppression made against assessee is not sustainable and hence the SCN,which has been issued on 31.01.2008 covering the period March, 2003 to December,2005 is completely time barred - Appeal allowed: CESTAT


Franke Faber India Ltd Vs CCE (Dated: January 20, 2017)

CX - CENVAT - Common input services - Rule 2(e) of CCR, 2004 - Notfn. 3/2011-CE(NT) - Trading activity was incorporated in the definition of exempted services onlyfrom 1/4/2011, therefore, prior to that date rule 6 of CCR, 2004 is inapplicable -recovery of CENVAT credit attributed to trading activity is not sustainable : CESTAT[para 5]



Bajaj Auto Ltd Vs CCE & ST (Dated: January 10, 2017)

CX – Since the imported machine was damaged in transit and parts of the same werereplaced by fresh import of spares, credit proportionate to damaged parts is notavailable as the same were not used – appellant have neither informed that they haveavailed full credit on said machine after repairs/replacement of certainparts/components, nor they have informed that they have availed credit on that part ofmachine which was received in damaged condition, therefore, extended period rightlyinvoked – impugned order upheld and appeal dismissed: CESTAT [para 4 to 6]



KEC International Ltd Vs CCE (Dated: January 10, 2017)

CX - Appellants are engaged in the manufacture of Galvanized Transmission LineTower [CSH 730820] - Appellants have cleared only parts of towers from the factoryand not nuts, bolts and washers which were supplied directly at the project site -However, in some cases nuts, bolts and washers were received in the factory andcleared along with other tower parts when duty was paid on inclusive value - SCN wasissued alleging that the value of nuts, bolts and washers etc. directly purchased fromthe manufacturer and delivered at the site should be included in the value ofgalvanized tower materials - demand confirmed, hence appeal to CESTAT. Held:Appellants submitted that the towers were erected and nuts, bolts and washers etc.were used at the site only; that it was never assembled in the factory, so there is noquestion of testing of the Transmission Line Towers - Commissioner mentioned in theimpugned order that towers are erected at the factory - even SCN mentioned that thetowers were erected at the site - Thus, there is a contradiction mentioned in the showcause notice and the impugned order - leviability of excise duty is different for thetowers which are assembled in the factory than those erected at the site and whichcome out as an immovable structure - it appears that the authorities below have notexamined the issues properly in a right perspective - matter remanded for re-examination of facts: CESTAT [para 5 to 7]


Jain Ceramic Colours And Coatings Pvt Ltd Vs CCE (Dated: January 31, 2017)

CX - Branded goods - SSI Notification 8/2003-CE - Appellant during the period ofdispute had cleared the insulators [CSH 8546] to M/s Taruna Decom Pvt. Ltd., Bikaner

affixed with the mark "TDPL" by availing SSI exemption - Department of the view thataffixation of the mark tantamount to manufacture of branded goods and SSIexemption is not available - Commissioner confirming demand of CE duty along withpenalty and interest - appeal to CESTAT. Held: Such insulators, after being received byM/s TDPL are inturn offered for sale to various Electricity Boards - The mark "TDPL" isto be affixed on the insulator for the purpose of identifying the insulator as havingbeen supplied by M/s TDPL to the Electricity Board - Director of M/s TDPL in hisstatement dated 25.02.2010 has confirmed that such marks are required to be affixedon the insulators to facilitate the Electricity Boards to identify the supplier of insulatorin case of rejection of the insulators by the Electricity Board and that these are not inthe nature of brand name - It cannot be stated that the mark "TDPL" is a brand nameowned by M/s TDPL - An identical issue already stands decided in favour of theappellant in the case of Avinash Prefabs 2001 (131) E.L.T. 415 (Tri. - Chennai) -appellant will be entitled to the benefit of SSI Notification No. 8/2003-CE dated01.03.2003 during the period under dispute - impugned order set aside and appealallowed: CESTAT [para 7 to 9]


ITC Maurya Sheraton Hotels And Towers Vs CCE (Dated: January 10, 2017)

CX - Classification of Kulfi - Whether under Chapter Heading 0404 as claimed byappellant or under CSH 2105 as contended by Revenue. Held: Identical issue hadcome up before the Tribunal in the case of Parsi Dairy Farm vs CCE, Mumbai-I = 2016-TIOL-2910-CESTAT-MUM , wherein it is held that ‘Kulfi' is correctly classifiable underCH 0404 - following the same, impugned order is set aside and appeal is allowed withconsequential relief: CESTAT [para 5, 7]


CCE Vs Anopchand Trilokchand Jewellers Pvt Ltd (Dated: November 21, 2016)

CX - Brand name - Chapter Note 12 of the Chapter 71 of the CETA, 1985 - Mereinscription of two small letters viz. "AT" on various jewellery items cannot make saidletters "AT" a brand name unless these two letters "AT" could be covered by thedefinition of brand name or trade name - mere embossing initials cannot be equatedwith affixing of brand name - Respondents have a different trade mark/brand nameregistered in their name, which has not been used for the subject goods viz. articles ofjewellery, therefore, mere use of minute-sized two letters "AT" cannot be called thebrand name of the respondents - Revenue appeal has no merits, hence rejected andimpugned order of Commissioner sustains: CESTAT [para 6, 6.3, 6.4]


Autopack Machines Pvt Ltd Vs CCE (Dated: November 16, 2016)

CX – Appellant manufacturing and clearing Industrial packing machines in completelyknock down condition (CKD) on payment of duty to the site of the buyer – Appellantdischarging duty liability on the value of clearance at factory gate against invoiceraised on customer – Machines are assembled at site and fixed on concrete pedestalfor which a separate invoice is raised by appellant – Revenue seeking inclusion of'erection, installation and commissioning charges' in the A.V – demand upheld by lowerauthority, therefore, appeal to CESTAT. Held: Issue is no longer res integra – In almostidentical circumstances, Tribunal has held in case of Puissane De DPK - 2013-TIOL-1535-CESTAT-MAD that such charges being paid on account of services offered afterthe manufacture and clearance of the product is not liable to be included in theAssessable value – therefore, goods cleared at the factory gate, A.V will not includepayment made for activities thereafter – impugned order set aside and appeal allowed:CESTAT [para 3, 4, 5]


Business Combine Ltd Vs CC & CE (Dated: December 13, 2016)

CX - Duty demanded from appellant for non-inclusion of value of patterns supplied bycustomers of castings to be manufactured out of sand moulds shaped according tothese patterns - period April 1996 to October 2000. Held: There is on record a letterdated 17th March 1998 issued by the Range Officer to appellant calling upon the latterto pay the differential duty on the use of patterns supplied by M/s. Alfa Laval and replyof appellant dated 5th May 1998 refuting the liability to duty on that count - Despitethis correspondence, no action was taken till another three years had elapsed asdemand notice was issued only on 6th February 2001 - in these circumstances,invoking extended period of limitation is improper - demand fails to sustain on thisground - appeal allowed: CESTAT [para 5]


Bala Ji Wires Pvt Ltd Vs CCE Dated: October 13, 2016)

Central Excise – Manufacture - process of galvanization simplicitor does not amount tomanufacture: The issue in this appeal is whether the process of galvanization on dutypaid Black Wire amounts to manufacture.

Prior to 01.03.2005, both plated or coated wire with zinc and un-plated wire werelisted in heading 7217 and subsequent to March 01, 2005 under the 8 digit Tariff,Black wire was listed under heading 72171010 and G.I . Wire under heading72172010. Held that process of galvanization simplicitor does not amount tomanufacture and accordingly the whole show cause is misconceived, demandingCentral Excise duty from the appellant. Further, held that the appellant have rightlypaid duty by reversal of credit under the provisions of Rule 6(3)(b) of Cenvat CreditRules, 2004. The show cause notice is misconceived as it ignores the CBEC Circular,wherein it has been said that galvanization of black wire does not amount tomanufacture. Accordingly, the impugned order is set aside and the appeal is allowedwith consequential benefits to the appellant, if any. – para 8


Hindustan Zinc Ltd Vs CCE (Date: January 4, 2017)

CX – Rule 2(l) of CCR, 2004 - Service Tax paid on tracking service viz. Truck Khojservices is an Input Service – credit admissible: CESTAT [para 7]



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

CX – Notfn. 3/2004-CE – Exemption was denied on ‘PVC Pipes' on the ground that theproject for which pipes were supplied has not fulfilled all the conditions inasmuch asthere is not water supply plant and no storage facility of the water – appellantsubmitting that the pumping station is water supply plant and discharge chamber isstorage of water; that there is a condition of providing a certificate from theCollector/Dy. Collr./DM of district in which the project is located and once the same issubmitted no question ought to be raised regarding eligibility of notification. Held:From the explanation to the impugned notification, it can be seen that the watersupply plant not only includes the plant of demineralization or purification of the waterbut water supply plant also and if any plant is built for water supply, it is covered bythe term "water supply plant" – also water, after supply from pumping station from thesource point, is supplied to the discharge chamber and thereafter it is released forirrigation purpose, therefore, discharge chamber is nothing but storage facility – boththe conditions of existence of water supply plant and storage facility are fulfilled –appellants are entitled for the exemption notification 3/2004-CE – impugned order setaside and appeal allowed: CESTAT [para 4, 4.1, 5]


Denso India Ltd Vs CCE (Dated: November 4, 2016)

CX - Cenvat credit was denied and penalty of equal amount was imposed - There areno allegations in Show Cause Notice that information required in ER-1 was deficient -Ratio of ruling by High Court stated is squarely applicable - Part of Show Cause Noticewhich deals with the proposal for the recovery of Cenvat credit is set aside: CESTAT


CCE, C & ST Vs Hindustan Petroleum Corporation Ltd (Dated: December 14,2016)

Central Excise – CENVAT Credit – Respondent availed credit on various input servicesunder CCR 2004, and was issued with the Show Cause Notice for recovery of CENVATcredit availed on (a) health insurance services and (b) invoice dated 07.05.2004, onthe ground that the service is received prior to 10.09.2004 - the original authorityconfirmed the demand for recovery of credit with interest and penalty; Commissioner(Appeals) allowed the credit and set aside the demand, now agitated by Revenueherein.

Held: From the explanation given by the respondent it is seen that in respect of (b),the services were composite services and were received after 10.09.2004; that thepayment for the said service is made on 16.12.2004 and thereafter - Therefore, thedepartment's contention that the service was received prior to 10.09.2004 is baseless;the respondent has received the service after 10.09.2004 and Commissioner (Appeals)has rightly allowed the credit on this count – In respect of (a), the issue ofadmissibility of credit availed on health insurance services prior to 01.04.2011 iscovered by the various judgments - no infirmity in the order by the Commissioner(Appeals) [Para 5]


Pharmpack Pvt Ltd Vs CCE (Dated: September 16, 2016)

CX - Assessee engaged in manufacture of lime mixed chewing tobacco - All goods arenotified for MRP based assessment in terms of Serial No. 27 of MRP based Notfn -Thus, filter khaini manufactured by assessee are notified for MRP based assessment -As per Rule 26(a) of Legal Metrology (Packaged Commodity) Rules, there is norequirement to make declaration on package provided the net weight of commodity is10 grams or less - Packing machine used for packing of filter khainipouches/pillows/sachets cannot be considered to be notified item and the goodsmanufactured with the aid of packing machine would not be covered underCompounded Levy Rules - They are required to discharge duty not in terms of the saidRules but in terms of the normal provisions of law: CESTAT.



Miraj Products Pvt Ltd Vs CCE (Dated: November 11, 2016)

CX - Assessee engaged in manufacture of lime mixed chewing tobacco - All goods arenotified for MRP based assessment in terms of Serial No. 27 of MRP based Notfn -Thus, filter khaini manufactured by assessee are notified for MRP based assessment -As per Rule 26(a) of Legal Metrology (Packaged Commodity) Rules, there is norequirement to make declaration on package provided the net weight of commodity is10 grams or less - Packing machine used for packing of filter khainipouches/pillows/sachets cannot be considered to be notified item and the goodsmanufactured with the aid of packing machine would not be covered underCompounded Levy Rules - They are required to discharge duty not in terms of the said

Rules but in terms of the normal provisions of law: CESTAT.


Mideast Integrated Steels Ltd Vs CCE & ST (Dated: September 9, 2016)

Central Excise – Benefit of CENVAT credit on EOT Crane and Gratings.

Held: certain items like pulleys and rails are fixed to the walls on which over-head EOTcranes are moving – As per HSN Explanatory Notes, beam of cranes runs on rails fixedon walls or on suitable supporting metal structures - when structures like rollers,pulleys and guide rails are essentially required for the functioning of crane then thesame have to be treated as an accessory of the machines for which Cenvat Creditunder Cenvat Credit Rules is admissible – the same was held in Commissioner ofCentral Excise, Raipur v. Jindal Steels & Power Ltd. – regarding Cenvat credit ongratings, such platforms are essential for operating the machines used in themanufacture of finished goods - Cenvat Credit with respect to EOT Crane and Gratingsavailed by the Appellant is available - Cenvat Credit with respect to steel and bentitems is inadmissible – Appeal partly allowed – (Para 5, 6, & 7).


CCE & ST Vs Se Composite Ltd (Dated: November 10, 2016)

Service Tax - Refund Claim - In view of the Commissioner (A)'s observations thatassessee-SEZ's request for condonation of delay in filing the refund claim underNotification No.09/2009-ST should have been considered by adjudicating authority byapplication of mind to the facts; and that the grounds taken up by Asst. Commissionerin rejecting the claim as time barred are beyond the scope of wordings of theNotification, there is no infirmity in the impugned order setting aside the OIO thatdisallowed the refund claim.

Commissioner (A) has clearly made observations that the para 2(f) of the NotificationNo.09/2009-ST under which assessee had filed refund claim along with request forCOD, provides that refund claim shall be filed within 6 months or such extended periodas Asst. Commissioner, shall permit; however, OIO held that the request for CODcannot be part of the refund claim itself and request for extended period of time shouldbe filed first and on obtaining such permission only claim can be filed and so rejectedthe claim as time barred, which is not tenable; such contention is very far fetched andbeyond the scope of wordings of the Notification and discretionary powers given toAsst. Commissioner has to be exercised by application of mind to the facts of the case;there is no provision to have two separate proceedings viz., first to decide ondelay/request for condonation and then on the refund claim per se and; both can betaken together and decided - Hence, no infirmity in the impugned order - Revenue'sappeal dismissed. [paras2, 6]


Unichem Laboratories Vs CCE & ST (Dated: January 12, 2017)

CX - Assessee engaged in manufacture of pharmaceutical product - Dispute is withreference to Cenvat credit availed by assessee in respect of "Cleaning andHousekeeping Services" - Both the authorities below disallowed such credit - Issue hasbeen settled in favour of assessee in view of Delphi Automotive System Pvt. Limited2014-TIOL-2597-CESTAT-DEL- Accordingly, impugned order set aside: CESTAT


Tafe Motors And Tractors Ltd Vs CCE & ST (Dated: January 12, 2017)

CX - Refund - Assessee engaged in manufacture of IC Engine and parts thereof andcleared these goods to their sister concerns situated at Mandideep (Bhopal) andFaridabad - Refund of said amount was not paid in cash to assessee but was creditedto Consumer Welfare Fund - There is nothing on record which has been submitted byassessee to rebut that the presumption that the duty incident has been passed onwhich is built into Section 11B of CEA, 1944 - In the result, impugned order is upheld:CESTAT


Minda Industries Ltd Vs CCE (Dated: December 8, 2016)

CX - Demand of interest on the duty paid supplementary invoice issued subsequent tothe clearance of the goods for the differential price - lower authorities held thatinterest is chargeable on the duty paid - appeal to CESTAT. Held: Since the matter hasbeen referred and is pending before the Larger Bench of the Supreme Court in SAIL2015-TIOL-292-SC-CX to decide finally the issue whether in case of supplementaryinvoice, interest is chargeable on the duty from the date of clearance till the date ofpayment of duty, the matter cannot be decided finally - In the interest of justice,matter is remanded to the original authority to decide SCN after delivery of thejudgment by the Larger Bench - matter remanded: CESTAT [para 4]


Neo Foods Pvt Ltd Vs CCE, ST & C (Dated: November 17, 2016)

Central Excise - Refund Claim - ‘Product Liability Insurance' is covered in the definitionof ‘input service' u/r. 2(l) of the Central Excise Rules, 2004 - Hence, rejection ofappellant-EOU's refund claim for unutilized credit of the service tax paid on theimpugned service , is set aside - Appeal allowed. [para 5]


Semco Electric Pvt Ltd Vs CCE (Dated: December 30, 2016)

CX - Refund - CENVAT - Service of GTA in respect of transportation of goods fromfactory to the port for clearance of export goods, whether admissible as credit. Held:In a number of cases it is held that in case of exports, the place of removal standsextended to the port of export as the ownership of the export goods remains with theexporter till the goods are shipped and sailed to foreign country from the port - in viewof settled law, credit is admissible and, therefore, appellant is entitled for refund underrule 5 of CCR, 2004 of CENVAT credit - impugned order set aside and appeal isallowed: CESTAT [para 4]


CC,CE & ST Vs Jocil Ltd (Dated: September 26, 2016)

Central Excise - CENVAT Credit on transportation of goods delivered at the premises ofthe customer - The issue stands covered by the judgment laid in various decisions ofthe Tribunal as well as the High Courts. Further the Circular No. 97/8/200-ST dated23.08.2007 clarified that assessee is eligible for credit of service tax paid ontransportation of goods to the place of the customer if such transportation is on FORbasis. Revenue appeal has no merit. (para 3)


CCE Vs Kongavi Electronics Pvt Ltd (Dated: November 18, 2016)

Central Excise - Penalty - In view of the clear observations in impugned order ofCommissioner (A) that, ‘for imposition of penalty u/r. 25 of Central Excise Rules, 2002,the short/non payment must be due to fraud, collusion or any willful mis-statement orsuppression of facts with an intent to evade payment of duty and since no allegationson suppression of facts are made in the SCN issued to assessee, penalty u/r. 25 cannotbe imposed in the case for non-payment/belated payment of interest u/r. 8(3)', thereis n o merit in Revenue's appeal against non-imposition of penalty and is dismissed .[paras 4, 5]


Kappac Pharma Ltd Vs CCE (Dated: January 4, 2017)

CX - Whether transportation charges paid by the appellant for clearances of their finalproduct and subsequently taken reimbursement from the customers is required to beincluded in the assessable value or otherwise for the period July 2001 to March 2002.Held: Goods sold by the appellant is at factory gate, the transportation is freight whichwas paid by the appellant to the transporter and subsequently taken reimbursementfrom customers - Transportation beyond the place of removal is not includible in theAV in terms of rule 5 of the Valuation Rules, 2000 - Supreme Court in the case of IspatIndustries Ltd. 2015-TIOL-40-SC-CX has held that transportation charges in case ofex-factory sale is not includible in the AV - Impugned order is set aside and appeal isallowed: CESTAT [para 5, 6]


Indus Engineering Company Vs CCE (Dated: December 19, 2016)

CX - SCN was issued to the appellants on the ground that Notification No. 214/86-CEwas violated on the ground that the supplier of input has not discharged excise duty -Inasmuch as notification No. 214/86 is not available to job worker and they arerequired to pay duty on processed BQ plates - appeal to CESTAT. Held: Appellant aswell as their principal unit who supplied inputs have been making correspondence withthe jurisdictional officers disclosing the entire modus operandi involved - If at all thedepartment is of the view that the appellant is liable to pay duty, nothing preventedthem from issuing a SCN within the stipulated time period of one year - since SCN forthe period July 2000 to August 2000 was issued on 06/05/2002, much after one yearof the transaction of the goods, there is no suppression on the part of the appellantand extended period is wrongly invoked - demand is not sustainable on ground oflimitation itself without going into the merits of the case - Appeal allowed: CESTAT[para 5, 6]

2017-TIOL-303-CESTAT-CHD

JCT Ltd Vs CCE (Dated: September 15, 2016)

Central Excise - Appellant is manufacturer of various kinds of yarn - NotificationNo.30/2004-CE exempts Nylon filament yarn from payment of duty - appellant availedcredit while procuring the same and reversed the credit while clearing the said goods -revenue claims that as the appellant has taken credit on the inputs they are noteligible to avail exemption under Notification No. 30/2004- CE.

Held: At the time of availment of credit on the inputs it was not known to the appellantwhich inputs will go into the manufacture of said goods but before clearance of the saidgoods, the appellant has reversed the credit attributable to the inputs used in themanufacture of said goods - therefore the reversal of credit is equivalent to not takenthe credit on inputs used in the manufacture of said goods - Hence, appellant isentitled to avail the benefit of said notification - impugned order set aside - (Para 2, &6)


Hydex Chemicals Pvt Ltd Vs CC, CE & ST (Dated: October 14, 2016)

Central Excise - CENVAT Credit - Demand raised on the ground that in contravention ofRule 8(3A) appellant utilized credit for payment of duty during the period of default ofeducation cess, is not sustainable - Considering the facts that the amount defaulted,i.e., Rs. 4,260/- is nominal and that it was only education cess and secondaryeducation cess that is to be calculated on the duty that has already been dischargedand that it was reflected in ER-1 return, no mens rea can be attributed to appellant toevade payment of duty - Various precedents have held that Rule 8(3A) of CER, 2002 tobe unconstitutional - Hence, appeal allowed. [paras 1, 2, 6]


Dew-Pond Engineers Pvt Ltd Vs CCE (Dated: January 6, 2017)

CX - Rule 8(3A) of CER, 2002 - Default in payment of monthly duty - It is notdisputed that on the same clearances, duty was paid twice, first from cenvat creditand second time from PLA on insistence of the department - when the appellant havemade request in writing for re-credit in the cenvat account, the same can be disposedof considering it as refund claim - no unjust enrichment arises as duty passed on isonly one time - order set aside and appeal allowed: CESTAT [para 4]



Hts Agro Tech Industries Vs CC, CE & ST (Dated: October 14, 2016)

Central Excise - Refund claim - Precedents have clearly held that credit of duty paidon inputs used in manufacture of goods exported under bond without payment of dutyis admissible, even if the goods are dutiable or exempted and such cases are coveredu/r. 6(6)(V) of Central Excise Rules, 2002 but not u/r. 6(1)(6)(4) of CCR, 2004 -Hence, appellant's refund claim for accumulated credit cannot be rejected on theground that exported final goods attract nil rate of duty and so credit is not admissibleon the inputs - Rejection of refund on the ground that no evidence was produced toshow that the accumulated credit was shown as ‘receivables' in balance sheet is alsonot sustainable, since goods having been exported, it is immaterial whetheraccumulated credit have been shown as receivable/advances - Hence, appellant iseligible for refund - Appeal allowed . [paras 1, 5, 6]


CCE Vs Kores (India) Ltd (Dated: December 14, 2016)

Central Excise - CENVAT Credit - Refund of unutilized credit - respondent has paidduty on capital goods and inputs during May, 1995 while debonding their unit intoDTA from EOU - Their claim for credit of the duty paid was denied and carried inappeal - the Tribunal held the issue in favor of the respondent rendering them eligiblefor credit - Meanwhile, their unit was closed down and the respondents sought claimfor refund of the unutilized credit on the ground of the unit being closed down, whichwas sanctioned in adjudication and upheld by Commissioner (Appeals); now agitatedby Revenue herein.

Held: The main contention put forward by the Department is that there is no provision

in law for refund of the unutilized credit on the ground of the unit being closed; andthat Rule 5 refund relates to inputs and input services and not refund lying in creditavailed on capital goods - The Commissioner (Appeals) has relied upon the decision ofHigh Court of Karnataka in the case of UOI Vs. Slovak India Trading Co. wherein theCourt considered the issue whether assessee eligible for refund when the unit hasbeen closed down - The High Court ruling was maintained by Supreme Court - Thoughthe issue relates to the credit availed on inputs, as the credit availed on inputs, capitalgoods and input services fall into the common pool of credit, the said decision wouldbe applicable to the capital goods also - In the present case, the issue whetherappellant is eligible for credit on capital goods after debonding had travelled up to theTribunal which was held in favor of assessee; no infirmity in the order passed by theCommissioner (Appeals). [Para 4]


CCE Vs Domino's Pizza India Ltd (Dated: January 5, 2017)

CX - A remand order does not imply acceptance of the contention of assessee but is adirection to pass an order after taking into consideration various aspects pointed outby the appellate authority - interest of Revenue is not jeopardized – Propriety of theremand is not excluded from applicability of the new litigation policy contained in theinstruction of 17 th December 2015 issued in F No 390/Misc/163/2010-JC and asmade applicable to pending appeals by letter dated 1 st January 2016 - RevenueAppeal dismissed: CESTAT [para 5, 8, 9]



JSW Ispat Steel Ltd Vs CCE (Dated: September 14, 2016)

CX - Restoration of credit, or re-credit, is not a refund but a procedural step that is tobe accorded without ado – Such re-credit cannot fail to cross the hurdle of 'unjustenrichment' and must be allowed as a right of the appellant - Impugned order setaside and appeal allowed: CESTAT [para 4, 11, 14]



Khamitkar Computers Vs CCE (Dated: December 20, 2016)

CX - Appellant is purchasing and selling Computer CPU, Monitor, Keyboards, Hard Diskand CD Drive etc. - Appellant supplied these goods at the site of the consumer andconnected each other by using cord - Department's contention is that this activityamounts to manufacture of a computer, accordingly demand was confirmed – appealto CESTAT. Held: Activity does not amount to manufacture as whole computer isalready manufactured – no activity is carried out by appellant which amounts tomanufacture of some new and distinct product – impugned order set aside and appealallowed: CESTAT [para 5, 6]


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

CX - Assessee engaged in manufacture of plastic power cables and stainless steel wire

liable to central excise duty - They supplied excisable goods to Thermal Power Projectagainst International Competitive Bidding - Assessee was denied exemption underNotfn 6/2002-CE on the ground that goods cleared by them do not fall under CTH9801 - Exemption cannot be denied as goods manufactured by assessee cannot beclassified under CTH 9801 - Apparently, condition of Project Import required cannotbe literally imposed on Indian manufacturer for exemption under said Notfn - No meritfound in impugned order, accordingly, same is set aside: CESTAT


Mewar Bottling Compaby Pvt Ltd Vs CCE (Dated: December 14, 2016)

CX - Appellant using brand name 'Citra' on the aerated water manufactured andclaiming SSI benefit on the ground that brand name is owned by M/s. Limca Flavourand Fragrance Ltd., who were entitled to SSI benefit - Investigation conducted by thedepartment revealed that the brand name is owned and controlled not by LimcaFlavour and Fragrance Ltd., but by M/s. Parle Exports Ltd. who were not entitled tosmall scale industries exemption benefit - In view thereof, the contravention ofconditions specified in para 7 of Notification 175/1986 (para 4 of the succeedingnotification No. 1/1993 ) stand established, disentitling the appellant from SSIbenefit: CESTAT [para 5]

CX - Limitation - First show cause notice covering the period 5.4.92 to 31.5.1992 hasbeen issued on 16.3.1997 by invoking the extended period of limitation - For theperiod June to November, 1993 show cause notice has been issued on 3.1.1994 -Apex Court in Nizam Sugar Factory vs. CCE - 2006-TIOL-56-SC-CX has held that oncea Show cause notice stands issued, issuance of second show cause notice on the samefacts could not be taken as suppression of facts on the part of assessee - In respect ofsecond show cause notice, a portion of demand falls beyond the period of normal timelimit as prescribed u/s 11A at the relevant time - Consequently, the demand in thesecond show cause notice beyond the period of six months will be hit by time bar -Original adjudicating authority directed to requantify the demand by excluding thedemand beyond the period of six months - appeals disposed of: CESTAT [para 7, 8]


Crompton Greaves Ltd Vs CCE (Dated: January 5, 2017)

CX – Principle of 'comity of courts' - By no stretch can such an overlap even becontemplated in the jurisdiction of officials entrusted with the task of collection ofcentral excise – it is only the assessing Commissionerate that can exercise power ofassessment and demand duty that has been short-paid or not–paid - Addl. Commr. ofM-V Comm'te could not have saddled duty liability on the appellant registered injurisdiction of M-II Comm'te – demand of duty from, and imposition of penalty upon,the appellant is beyond jurisdiction and must fail – Bench, therefore, does not proposeto examine whether the appellant is liable to duty for non-compliance with theexemption notification - Impugned order set aside and appeal allowed: CESTAT [para7 to 11]



Aplab Seba Electronics Ltd Vs CCE (Dated: January 3, 2017)

CX - Valuation - Section 4 of CEA, 1944 - Appellants are liable to pay tax on the entirevalue of the goods recovered by them as per the contract - excluding the value of

guarantee is without any authority - in the invoices issued, guarantee amount hasbeen shown as extra charges and this amounts to mis-declaration - extended periodrightly invoked - appeal dismissed: CESTAT [para 4, 5]



Savita Oil Technologies Ltd Vs CCE (Dated: August 24, 2016)

CX - Refund claim filed consequent upon finalization of provisional assessment partlyallowed but that amount was credited to the Consumer Welfare Fund on ground ofunjust enrichment and balance amount was rejected as being time barred - appeal toCESTAT. Held: Any duty collected in excess during pendency of finalization ofprovisional assessment is in excess of that authorized by law and must, perforce, bereturned to the assessee - no requirement for a separate application for refund -claim, therefore, not time barred - as regards applicability of unjust enrichment,appellant had produced a certificate of a Chartered Accountant that the amountreceivable has been shown in accounts as ‘receivable' and this is sufficient evidencethat the incidence of duty has not been passed on - appeal allowed: CESTAT [para 5,6]


R R Paints Pvt Ltd Vs CCE (Dated: December 19, 2016)

CX – SSI exemption notification 8/2003-CE – Benefit denied on the ground that theaggregate value of clearances had exceeded Rs.3 crores in the preceding financialyear – appeal to CESTAT. Held: There is no dispute that the threshold limit of theaggregate value of Rupees three hundred lakhs was exceeded due to addition of valueof traded goods - The Notification No. 8/2003-CE, for the purpose of SSI exemption,is available only for manufactured goods and not for trading goods - If the value ofthe traded goods is excluded, then the aggregate value will remain below thethreshold limit of Rupees three hundred lakhs – impugned order is set aside andappeal is allowed: CESTAT [para 4]


New Bombay Ptg And Dyg Mills Ltd Vs CCE (Dated: January 2, 2017)

CX - Length of cooling zone, whether is to be added to the length of galleries whiledetermining annual capacity of production under rule 5 of HASITPACD Rules, 1998.Held: Cooling zone duly fitted with a blower most certainly is aiding the process ofdrying or cooling of fabrics which is distinct step in the process of heatsetting -Accordingly, provision in explanation (I) in HASITPACD Rules, 1998 become operative,therefore cooling zone has to be treated as a chamber or its fraction as per its length -impugned order upheld and appeal dismissed: CESTAT [para 4, 5]


Xerox India Ltd Vs CCE (Dated: November 29, 2016)

CX - Assessee have imported various models of digital Multi-functional printers,Copiers and Photocopiers-cum-printers from different units/warehouses of M/s. XeroxCorp located in different countries all over the world - In compliance of direction ofHigh Court, the present appeals have been again restored to Tribunal - Order passedby Allahabad High Court has been challenged by department before Supreme Court,

the same was tagged with another Civil Appeal of assessee pertaining to HyderabadBranch - Thus, on the issue, matter is sub-judice before Supreme Court - Liberty isgranted to assessee to come again after having final verdict from Supreme Court,within prescribe time: CESTAT


CCE Vs Samsung India Electronics Pvt Ltd (Dated: November 9, 2016)

CX - Refund - Assessee engaged in manufacture of Computer Monitors - Once theorder for finalization of assessment is issued and it is accepted by Department, thendepartment cannot question the quantum of refund arising out of it after filing of therefund claim - Issue of unjust enrichment has been properly examined at original andappellate stage and therefore, department's contention in grounds of appeal inrespect of unjust enrichment is not tenable in Law - Tribunal do not find any merit ingrounds of appeal extended by Revenue: CESTAT


Sriba Agro Ltd Vs CCE & ST (Dated: September 28, 2016)

Central Excise - Demand of duty on soap stock arising during the course ofmanufacture of refined cotton seed oil under extended period – When the assesseestopped paying duty as directed by the department, invoking suppression of facts isnot correct – Departmental Adjudicating Authorities should be cautious and applymind as pre-deposit is mandatory from 06/08/2014. (para 4)



Super Packs Vs CCE (Dated: August 30, 2016)

Central Excise - CENVAT Credit - Removal of inputs or capital goods to a job workerfor further processing, testing, repair, reconditioning or any other purpose is governedu/r. 4(5)(a) of CCR, 2004 but not u/r. 3(5) and as such requires no reversal of credit.

Appellant sent the credit availed inputs to job-worker for further processing, whoreturned the processed goods on payment of duty on which appellant availed credit -Revenue took view that such availment of credit resulted in double benefit toappellant and so entire credit taken should have been reversed u/r. 3(5) of CCR -Appellant submits that inputs are sent for further processing to job-worker wherebringing back of such processed inputs within 180 days is essential u/r. 4(5)(a) and ifnot, entire credit should be reversed; and that it should not be construed as clearanceof inputs ‘as such' where it is only a one way sale so as to be covered u/r. 3(5) - Fromthe perusal of Rules 3(5) and 4(5)(a) and in view of the precedents which heldthatremoval of inputs or capital goods to a job worker for further processing, testing,repair, reconditioning or any other purpose is governed u/r. 4(5)(a) of CCR, 2004 butnot u/r. 3(5), reversal of credit is not required u/r. 3(5) - Hence, appeal allowed.[paras 1, 3, 5]


CCE Vs Shiv Mechanical Works (Dated: October 18, 2016)

CX - Whole case of Department depends on statement of Shri Gian Singh who

indicated that clearance from M/s. Shiv Mechanical Works was to tune of Rs.1.2 croresand Rs.1.28 crores - These amounts were added to real turnover as shown in recordsand duty has been demanded - No efforts whatsoever has been made by Revenue tomake investigation to get corroboration and to examine the records of raw materials,clearance and details of buyers asset - Revenue contends that confessional statementof main party which has not been retracted is sufficient to uphold the charge ofclandestine clearance as well as clubbing of turnover of these two units - Even ifTribunal agree with said assertion, it is noted that Shri Gian Singh gave some roughestimate of turnover - At best, it can be starting point of investigation to establishcorroborative evidence - Now, to work out duty demand, approximate figures ofturnover is not legally sustainable - No justification found to interfere with impugnedorder: CESTAT


Salasar Steel And Power Ltd Vs CCE (Dated: September 16, 2016)

Central Excise – Clandestine clearances - appellant is engaged in the manufacture ofsponge iron; their factory was visited by the Central Excise officers who undertookverification of the stock - certain stock of the coal, ash char, fly ash bricks, fly ashblocks was found short; verification also resulted in excess stock of 286.235 MT ofsponge iron - cash was seized from residential premises of General Manager on thebelief that the same was sale proceeds of clandestinely removed goods and as suchliable to confiscation under Section 129 of the Customs Act, 1962 as made applicableto Central Excise matters – Original authority confiscated the alleged excess stock ofsponge iron with an option to the appellant to redeem the same on payment ofredemption fine; the cash amount was also confiscated absolutely under the provisionof Section 121 of the Customs Act, 1962 read with Notification No.68/63 dated4.5.63; and a penalty was imposed upon the appellant under Rule 25 of the CentralExcise Rules – same upheld by Commissioner (Appeals), and agitated herein.

Held: Law as regards confiscation of excess stock of goods almost stands settled; thesame cannot be confiscated on the mere conclusion of non-entry of goods in thestatutory documents, unless there is evidence that such stock was not entered in RG-1 register either deliberately or on the mala fide intention to remove the sameclandestinely – Indian currency was seized from the residential premises of the son ofGeneral Manager - no notice was issued to the person from whose possession thecurrency was seized, to confiscate the currency on the assumption that the samerepresents the sale proceeds of the goods cleared and sold by the manufacturing unitwithout there being any evidence to that effect and without there being any dutydemand in respect of such clandestinely removed goods - well settled law that onus toprove that currency in question represents sale proceeds of clandestinely removedgoods lies heavily on the Revenue and is required to be discharged with sufficientevidence, which has not been done in the instant case - no reason to uphold theimpugned order; accordingly, the confiscation of goods as also cash seized orimposition of penalty are set aside. [Para 8, 9, 11]


Sunvik Steels Pvt Ltd Vs CCE (Dated: Auguat 11, 2016)

Central Excise - CENVAT Credit - Appellant had for the first time, produced thecertificate of Chartered Engineer before the Tribunal explaining the use of impugneditems and also photographs, which were not produced before lower authorities. Sincethe certificate is vital for determining whether the credit is admissible on impugnedsteel and iron items as inputs, matter remanded back to original adjudicatingauthority for considering the certificate.

Credit availed on various iron and steel items as inputs was denied on the ground that

they do not fall under the definition of inputs u/r. 2(k) of CCR - Appellant-manufacturer of pig iron, etc., submits that they are used in work shop meant forrepair and maintenance of machinery used in manufacturing process and some ofthem are directly used in manufacturing activity - It is seen that OIO has observedthat appellant has not produced any documentary evidence to show the use ofimpugned items and that they had vaguely claimed that some of them are used inmanufacture of final product also - Commissioner (A) also observed the same statingthat appellant has not produced any evidence to substantiate their claim - However,appellant had now for the first time, produced the certificate of Chartered Engineerbefore the Tribunal explaining the use of impugned items and number of photographswere also produced - The certificate is vital in determining that whether the goodsqualify as inputs or not - Hence, in view of the certificate and precedents relied uponby appellant, impugned order is set aside and matter remanded back to originaladjudicating authority for decision afresh after considering the certificate and theprecedents - Appeal disposed of. [paras 2, 3]


Ultratech Cement Ltd Vs CCE & C (Dated: December 22, 2016)

CX - Assessee has exported cement in 50 kgs. bag - Where retail sale price was notrequired to be cleared other than package form would be entitled to benefit of theNotification No.4/2006-CE - Impugned order set aside: CESTAT


Siemens Ltd Vs CCE (Dated: January 1, 2017)

CX – Section 4 of CEA, 1944 – Rule 5 of Valuation Rules, 2000 - Freight per se is notincludible in the AV, therefore, whether the same is shown separately in the invoiceissued u/r 11 of the CER, 2001 or raised by a separate invoice, it is one and the samebecause in both cases the amount is identifiable as transportation – Freight insurancecollected by raising a commercial invoice is not includible in the AV of excisable goods– Impugned order set aside and appeal allowed: CESTAT [para 4]



Maharashtra Agro Industries Development Corporation Ltd Vs CCE (Dated:January 4, 2017)

CX – Adjudicating authority has confirmed CE duty on captive consumption of sugarsyrup which is used in the production of fruit juice which is exempted from payment ofCE duty – appeal to CESTAT. Held: Issue whether Sugar syrup manufactured andused captively is liable for duty or otherwise has been decided in various judgmentsand where it is held that if the sugar concentrate by weight is less than 65%, then itwill not have shelf life and such sugar syrup will not be marketable goods – in thepresent case, the undisputed fact is that sugar syrup contained more than 65% sugarconcentrate and also contained preservative viz. Citric acid, therefore, Sugar syrupindeed has shelf life and is marketable – Impugned order is upheld and appeal isdismissed: CESTAT [para 5]


Ravalgaon Sugar Farm Ltd Vs CCE (Dated: November 4, 2016)

CX - During the course of manufacture of sugar, bagasse waste arises and the same iscleared without payment of duty - Revenue contending that the appellant is requiredto pay 5%/8% of the value of bagasse in terms of rule 6 of CCR, 2004 - appeal toCESTAT. Held: It is settled by the decision in DSCL Sugar - 2015-TIOL-240-SC-CXthat rule 6 of CCR, 2004 has no application in case of removal of bagasse generatedduring the course of manufacture of dutiable goods i.e. sugar/molasses - demand is,therefore, not sustainable - impugned order set aside and appeal allowed: CESTAT[para 4]


Sangov Tubes And Pipes Pvt Ltd Vs CC, CE & ST (Dated: October 31, 2016)

Central Excise – CENVAT Credit – Pipes fall within the definition of capital goods andso MS items like angles, beams, channels, used in fabrication of steel tubes/pipes toconnect the machines would fall under the category of parts/components of capitalgoods and credit is admissible on them – No case that the items were diverted orused for laying foundation or for shed/building – Moreover, department had fullknowledge of availment of such credit though an earlier audit conducted in 2010 andthe fact was disclosed in ER-1 returns also – So, the demand raised for the period8.2010 to 1.2012 invoking extended period, is not sustainable on merits as well as onlimitation – Appeal allowed . [paras 1, 3]


Renuka Sugars Ltd Vs CCE (Dated: August 3, 2016)

Central Excise - CENVAT Credit -Impugned order of denial of credit on capital goods isnot sustainable since it had merely relied upon the report of the RO without appellantbeing associated in the enquiry and so the matter is remanded back.

Credit availed on cement, channels, angles, chequered plates as capital goods/inputsused for support structures of machinery, fabrication and foundation of equipmentetc., was denied on the ground that they were used for general maintenance, repairand fabrication works in the factory - Commissioner (A) held that even though onmerits credit is admissible on chequered plates if used in fabrication of crane carrier,appellant failed to show that the impugned goods were used in manufacture ofspecified items and no intimation of use of the items in the factory was given -Appellant had now produced the certificate of Expert and submits that lowerauthorities have never asked them to produce the certificate - Impugned order is notsustainable since it had merely relied upon the report of the RO without appellantbeing associated in the enquiry - In view of expert's evidence on record, matterremanded back to original authority for adjudication afresh after considering thedocumentary evidence and expert's certificate with regard to actual use of impugneditems in the factory. [paras 1, 2, 2.1, 3]


Sainath Incorporated Vs CCE (Dated: September 14, 2016)

CX - Once consequential relief is ordered, the lower authorities are deprived of thepower to reject, otherwise the appellate hierarchy will serve no purpose - presentstatus of the officers concerned is not known and it is that, and that alone, whichdeters the imposition of cost s : CESTAT [para 4 to 7]



MB Bakers Pvt Ltd Vs CCE (Dated: October 18, 2016)

CX - Assessees engaged in manufacture of biscuits on behalf of M/s Parle ProductsPvt. Ltd. on job work basis - Revenue views that since final products are exempted,intermediate product, sugar syrup arising in assessee's unit is liable to central exciseduty - Assessees submitted that sugar syrup prepared by them is not at all amarketable product - No efforts have been made by Department to test the productfor correct composition and nature - Further, the whole allegation of marketability isbased on one invoice of another manufacturer for product "sugar invert syrup" - It isfound that marketability of product cannot be established derivatively withoutascertaining the actual nature of the impugned product and also its marketability inreality: CESTAT


Monarch Pipes Ltd Vs C, CE & ST (Dated: November 11, 2016)

Central Excise - Clandestine clearances - As there is no plausible explanation for non-accountal of excess quantity of goods found at the time investigation, confiscation onthe allegation of clandestine removal is sustainable and redemption fine is justifiedconsidering the value of the goods. Quantum of penalties imposed is also reasonableand is as per law.

Since unaccounted excess quantity of goods were found at the time of investigation,on the allegation of clandestine removal, confiscation was ordered with redemptionfine and penalties, while duty demand was settled by appellant before SettlementCommission - Appellant's explanation that different varieties of pipes were notsegregated and so it appeared that there were excess quantity of goods and that theyare not in packed condition to say that they are ready for dispatch, is not tenable - Noproper explanation was given to sustain non-accountal of excess quantity of goods -Rule 173Q of CER, 1944 empowers confiscation for not making proper entry/notaccounting of goods - Statement of MD of appellant company shows that no furthermanufacturing is to be done on the goods seized - Hence, order of confiscation issustainable - Appellant's plea that since the goods were lying for more than 10 years,they are currently almost like scrap and so redemption fine of Rs. 12 lakhs isimproper, is also not acceptable - Value of the goods at the time of confiscation is tobe looked in to and not at the time of hearing of the appeal - Penalty of Rs. 12.92lakhs imposed on Jt. MD of the company for contravention of Central Excise Acts andRules, is justified as it is equal to the duty demand settled by appellant - Penalty ofRs. 3 lakhs imposed under 173Q is also justified as it is imposed at the then prevailingrate of 25% on the redemption fine - Hence, appeal is dismissed. [paras 1, 3, 5, 8, 9,10]


Dharampal Premchand Ltd Vs CCE (Dated: September 9, 2016)

Central Excise - Cenvat Credit - Recovery u/Rule 14 of Cenvat Credit Rules - Scope -Cenvat Credit taken on plastic pouches for packing chewing tobacco sought to bedenied on the ground that the Supreme Court banned the usage of the same -Question of recovery u/R.14 of Cenvat Credit Rules does not arise as credit wasvalidly taken - Impugned SCN and consequential order of recovery of credit properlyavailed, unsustainable.

The date on which Cenvat credit was taken by the appellant, the inputs on which theCenvat credit was taken were regularly in use for packing the finished product andtherefore the Cenvat credit availed was eligible. It is also clear that the Cenvat creditwhich is validly taken needs to be reversed only when the inputs are cleared as such.It is further noted that Rule 14 of Cenvat Credit Rules, 2004 provided for recovery of

irregularly availed Cenvat credit and it is beyond the scope of said Rule 14 of CenvatCredit Rules to recover the Cenvat credit which was validly taken. Therefore, it mustbe held that the Show Cause Notice is misconceived and therefore the Show CauseNotice, Order-in-Original and Order-in-Appeal were set aside and allow the appeal.The appellant shall be entitled for consequential benefits, if any, in accordance withlaw. (Para 6)



CCE Vs Raymond Ltd (Dated: December 22, 2016)

CX - Applicability of benefit of Notfns 2/96-CE and 67/95-CE - Subject items underconsideration are Synthetic Staple Fibres of Polyester (also referred as SyntheticTops) classifiable under sub-heading no.5506.20 of Schedule to CETA, 1985 - The col.4 of Table attached to notfn 22/96 covers all goods of Central Excise Tariff includingsub-items having classification under Chapter 5506.20 - 'Synthetic Tops' are used inmanufacture of yarn within the factory of production and said yarn is further used inmanufacture of fabrics - Both yarn and fabrics are covered under Chapter 54 -Therefore, exemption from payment of duty of excise and additional duty of excisewould be applicable in case of Polyester Synthetic Tops/Manmade yarn - There are nomerits in appeal filed by Revenue and same is, therefore, dismissed: CESTAT


CCE Vs RD Electronics (Dated: November 4, 2016)

CX - Whole of the demand has been made out on strength of documents recoveredfrom premises of assessee and said documents were never disclosed to them - Searchproceedings took place as early as 1999 and till date the relied upon documents havenot been furnished to assessee - Commissioner (A) has given the finding thatdocuments have not only been given, but the same was not available withadjudicating authority and were not even made available to appellate authority -Tribunal have no option, but to uphold the order passed by Commissioner (A):CESTAT


Orient Cement Vs CCE, C & ST (Dated: October 26, 2016)

Central Excise - CENVAT Credit - Cenvat credit is admissible on ‘Welding Electrodesand Gases' used for repair and maintenance of plant/machinery during the period Jan'2010 to Feb' 2010, in view of the precedents which held that the word ‘includes' in thedefinition of ‘inputs' during the relevant period cannot be considered to have arestrictive meaning - Hence, appeal allowed. [paras 1]


Mylan Laboratories Ltd Vs CCE , C & ST (Dated: October 27, 2016)

Central Excise - Education Cess - For DTA clearances from 100% EOUs, EducationCess and Secondary higher education Cess could not be levied for 3 rd time, in view ofthe precedents - Appeal allowed . [para 1]


Ripples Fragrance Pvt Ltd Vs CCE, C & ST (Dated: August 30, 2016)

Central Excise - Mandatory Pre-deposit - There is no provision under Central ExciseAct or CESTAT Procedure Rules or CESTAT and CBEC Circulars, which satisfies thatamount paid in one appeal can be adjusted towards other appeal for the purpose ofmaking mandatory pre-deposit under amended Section 35F.

Appellants submits that the parent company and others have deposited variousamounts towards adjudicated liabilities and so prays that considering such deposits,requirement of mandatory pre-deposit may be waived in all their concerned appeals -Revenue contends that if assessee had made any deposit at any stage, such amounteven if it is in excess of mandatory pre-deposit can be considered as pre-deposit onlyin respect of that appeal and cannot be adjusted against other appeals; and that evenunder earlier Section 35F, stay application filed by each appellant against each orderwas considered separately and similarly under amended Section 35F also each appealhas to be treated separately for making mandatory pre-deposit and so each appellanthas to pay the deposit individually and amount paid by one appellant cannot beadjusted against others - From the perusal of amended Section 35F of CEA, CESTATProcedure Rules, 1982, CESTAT and CBEC Circulars, it is clear that there is noprovision under any of these Acts/Rules/Circulars which satisfies that amount paid inone appeal can be adjusted towards other appeal - Language of Section 35F is veryclear that ‘Tribunal should not entertain any appeal without the mandatory pre-deposit of 7.5%/10% of adjudged liabilities' - Hence, all miscellaneous applicationsare dismissed and appellants are directed to make the pre-deposit as per Section 35Fwithin a month. [paras 2, 3, 4, 5]

2017-TIOL-236-CESTAT-AHM

Sunshine Overseas Vs CCE & ST (Dated: November 21, 2016)

CX - In confirming the demand against assessees M/s. Premier Polyspin Pvt. Limited,Adjudicating authority considered evidences mainly in form of statements, which theassessee claimed to be not reliable and sought cross-examination of Shri HaroonRazaq Chhaya, Shri Irfan Gulam Rasool Saiyed and Shri Rashid Sadatli Saiyed - Also,the grievance of assessee is that no effective personal hearing was extended to theminasmuch as three consecutive dates of hearing was given by Adjudicating authoritywithout affording time for them to attend personal hearing and defend their case -Assessees M/s. Sunshine Overseas, Shri Haroon Razaq Chhaya, Shri Irfan GulamRasool Saiyed and Shri Rashid Sadatli Saiyed be allowed cross-examination ofwitnesses requested by them except the panch witnesses and M/s. Premier PolyspinPvt. Limited and Shri Rohit Dharamprakash Gupta be supplied with copies of reliedupon documents and the un-relied upon documents be returned to them: CESTAT


CCE Vs Bijoy Concrete Works (Dated: July 25, 2016)

CX - Availability of CENVAT Credit on transportation services from factory to the pointof delivery of customers - It is observed that same is pertaining to suo motto revieworders passed by Departmental officers under Section 35E (3) of CEA, 1944 whichgives Departmental officers and CBEC the power to review - Limitation with respect toO-I-A passed by first appellate authority will be as provided in Central Excise as theissue is not pertaining to order-in-review passed by Committee of Commissioner -Accordingly, relevant date for purpose of computing available period has to becalculated from date of receipt of O-I-A - Conditions prescribed by CBEC for availingCENVAT credit on transportation services beyond factory are not satisfied - It has tobe hold that contract between assessee and customers is not on FOR destination basis

- Accordingly, impugned order set aside and appeal allowed: CESTAT


Bharat Heavy Electricals Ltd Vs CCE (Dated: October 4, 2016)

CX - Issue relates to "Super Rapid Gun Mount" (SRGM) manufactured and cleared toIndian Navy - Original Authority held that assessee has cleared complete SRGM fromtheir factory premises and not assembly or sections thereof, which is classifiableunder CH 9301.00, liable to nil rate as per tariff - First Appellate Authority on appeal,held that assessee is required to discharge duty on all individual parts/sub-assemblieswhich were used in combination with other parts/components to manufacturecomplete SRGMs - In the manufacture of SRGMs both bought out (imported) as wellas assessee's own manufactured parts/components/sub-assemblies were used - Nocredit of duty paid on bought out items have been availed by assessee - While there isno dispute on legal principle upheld by impugned order, duty liability of assesse has tobe found on basis of already discharged duty, exclusion of bought out items andimported SRGM as discussed above - If needed Original Authority can re-verify thecorrect payment of duty by assessee with records: CESTAT


Indo Asian Fusegear Ltd Vs CCE (Dated: June 13, 2016)

Central Excise - MRP based Valuation - Compact Fluorescent Lamp - Is an itemspecified under Section 4A of the Act and is covered under the Packaged CommoditiesRules - Bulk sale of the bulbs to institutional customers with MRP affixed on them notexempted under Rule 34 of the PC Rules r/w Section 4A of the CEA, 1944-Impugnedorder requiring that goods in question have to be liable to be valued for duty underSection 4 instead of Section 4A of CEA 1944, erroneous - Impugned order set aside.(Para 6)



CC, CE & ST Vs Sagar Cements Ltd (Dated: October 26, 2016)

Central Excise - CENVAT Credit - Department did not produce any evidence to showthat the credit availed Group Mediclaim policy, Rent-a-cab and Air Travel agencyservices were used for personal use of employees of respondent's company -Admittedly, returns reflected the availment of credit and so no suppression of factscan be attributed for invocation of extended period - Hence, no infirmity in the orderof Commissioner (A) observing that the demand is time barred and allowing the creditfor the period 5.2007 to 9.2011 - Hence, revenue's appeal dismissed. [paras 1, 2]


Raj Finoxides Pvt Ltd Vs CCE (Dated: September 21, 2016)

CX - Allegations of clandestine manufacture and removal of Lead/Alloy ingots, dutydemand thereof - apart from manufacturing lead alloy ingots from their own rawmaterials, appellant is also making such lead ingots of various grades from waste &scrap, dross, sump paste, lead sludge, lead dust, scrap oxide received from M/s ExideIndustries Ltd. (EIL) under Rule 4(5)(a) of the CCR, 2004 - confirmation of dutydemand on intermediate goods - appeal to CESTAT. Held: It is a settled law thatAppellant is not required to discharge duty on intermediate goods manufactured on

job work basis when inputs are received from EIL under Rule-4 (5) (a) of the CCR,2004 - As regards Input Output norms applied by department, input - output norms of1 kg of lead for every 1.07 kg of waste & scrap cannot be made applicable to allcategories of waste & scrap and can be made applicable only to standards waste &scrap where metal content in the waste and scrap is 97% or more - If the departmentwas not agreeable to the % recovery prescribed by M/s Exide Industries Limited thenthe only way to reject that could have been to have sample yield studies done by theinvestigation to determine recovery yield percentages - There is no evidence that anylead ingots have been cleared clandestinely except presumptions surmises &theoretical calculations based on standard Input-output norms which does not applyto the waste & scrap received by the appellant from M/s. EIL - In view of the aboveand settled proposition of law, there is no justification either for demanding duty orfor imposition of penalties against the appellants - Appeals allowed: CESTAT [para 5,7, 9, 10]


Hetero Labs Ltd Vs CCE (Dated: October 28, 2016)

Central Excise - Education Cess - In view of the precedents, Education Cess andSecondary higher education Cess are not chargeable on DTA clearances made by100% EOU even if such Cesses were added while calculating the correct duties ofCustoms payable at the time of import of goods - Appeal allowed . [paras 1, 2]


CCE Vs Birla Ericsson Optical Ltd (Dated: December 8, 2016)

CX - Department ordered provisional assessment which was finalised by theassessment order dated 01.02.2008 - consequently, duty paid in excess was adjustedagainst the excise duty short paid by the assessee and it was determined that theassessee had paid excess duty to the extent of Rs.14,43,333/- for which they filedrefund claim and which was originally sanctioned - later, department issued SCN forrecovery of the refund amount by taking the view that the refund will not be payablein cash on account of the fact that the assessee has not passed the test of unjustenrichment, inasmuch as they have received payments from their customers as perrevised rates - Commissioner (A) allowed refund, therefore, Revenue in appeal beforeCESTAT. Held: It is fairly well settled by the decision in Toyota Kirloskar Motor Pvt.Ltd. vs. CCE, LTU Bangalore = 2011-TIOL-941-HC-KAR-ST that the test of unjustenrichment prescribed in Section 11B of the CEA, 1944, will be applicable only to thenet adjusted duty arising as refund and not to the duty passed on in each invoice - noreason to interfere with the order passed by the Commissioner (Appeals) and hence itis upheld - Revenue appeal dismissed: CESTAT [para 3, 5]


Ultra Tech Cements Ltd Vs CC, CE & ST (Dated: October 27, 2016)

Central Excise - CENVAT Credit - Credit is admissible on welding electrodes used formaintenance and repair of capital goods, in view of the precedents - Appeal allowed .[paras 1, 2]


Shree Cement Ltd Vs CCE (Dated: October 28, 2016)

Central Excise - Valuation - Determination - Sale of cement directly to the consumerwithout MRP/Retail Sale Price marking held does not qualify the criteria of “RetailSale” - Packaged Commodity Rules inapplicable to such sale - Denial of concessionalduty benefit in terms of Sl. No. 1C of Notification No. 4/2006-CE is unjustified -Impugned order set aside.

The facts show that sales were made directly to the consumers at the negotiated priceand no RSP were marked on the packages. The bags used for such supply were alsomarked as "MRP not applicable for institutional / industrial / Government supplies notfor re-sale". In terms of 3rd proviso to the Notification No. 4/2006-CE where the retailsale price of the goods is not required to be declared under PC Rules and thus thesame was not declared, and assessee contends that the duty shall be determined asin the case of goods cleared in other than packaged form.

The Tribunal vide the final order No. 53855-53856/2016 dated 28.09.2016 held thatthe definition of retail sale as per Rule 2(q) of the PC Rules are to be examined beforedeciding the nature of sale. Admittedly, the cement without marking of RSP has beensold by the appellant directly to consumers and as such these transactions do notqualify as "retail sale" in view of the statutory definition which requires sale,distribution or delivery of such commodity through retail sale agency or otherinstrumentality for consumption by an individual. In the present case, the saleswithout RSP marking is direct to the consumer not through an intermediary as suchthe criteria for "retail sale" has not been fulfilled. As such, the Tribunal held thatwhenever such direct sale is affected application of PC Rules will not be governed byRule 3. In view of the Tribunal order, the impugned order is set aside allowing theappeal. (Para 4-6)


Ruby Foam Vs CCE (Dated: December 6, 2016)

CX - Appellant purchased duty paid cream separator machinery from M/s Alfa LavalIndia Ltd. and filed refund claim of the duty paid as a buyer of the goods on theground that the machine purchased is exempted under Notfn. 6/2002-CE, list No.32A, Sr. No. 3(vi) [Machinery for rubber plantation sector, namely Latex centrifugetesting] – lower authorities rejected the refund claim on the ground that the machineis not covered under the exemption notification – appeal to CESTAT. Held: LatexCentrifuge testing machinery appears to be testing equipment whereas creamseparator machine is used in processing of the rubber - By any stretch of imagination,both the machineries are entirely different and cannot be treated as one - Therefore,the said machine i.e. cream separator machine is not covered under the exemptionnotification under Sr. No. 3(vi) of the List 32A of the Notification – lower authoritieshave correctly denied the refund – impugned order upheld and appeal dismissed:CESTAT [para 4.1, 5]


Sunrise Tanks Pvt Ltd Vs CCE & C (Dated: September 15, 2016)

Central Excise - Small Scale exemption – Benefit of Notification No.8/2003 – Commoninputs of plastic granules used in the manufacture of branded and unbranded tanks -Appellant suo moto reversed credit attributable to inputs intended for the manufactureof unbranded tanks - Such reversal satisfied the condition of non-availment of Cenvatcredit entitling benefit of notification –In view of the fact that for subsequent periodthe demand dropped, appeal allowed - Cross objections of Revenue disposed of .(Para 6, 7)


Ravin Cables Ltd Vs CCE (Dated: January 3, 2017)

CX - Notfn. 6/2002-CE, Sr. no. 237 - Insulated Wires and Cables cleared by appellanton the basis of Annexure-I submitted by the buyer of the goods following theprovisions of Central Excise (Removal of the Goods at Concessional Rate of Duty forManufacture of Excisable Goods) Rules, 2001 - Revenue demanding CE duty fromappellant on the ground that the goods are not covered by the entry of the exemptionnotification - appeal to CESTAT. Held: Considering the provisions of Rule 6 of theRules, 2001 (supra) and the obligation of the buyer for execution of bond, it is clearthat if at all exemption is not available, duty can be recovered from buyer and notfrom the supplier: CESTAT [para 5]



Star Paper Mills Ltd Vs CCE (Dated: September 22, 2016)

Central Excise – Finalisation of Provisional assessment - during the relevant periodSection 11B for unjust enrichment was not applicable for refund arising out ofprovisional assessment .: The appellant had submitted in the grounds of appeal thatthe cash discount was not collected from their customers and cash discount was notpart of the assessable value and therefore, it was not part of cum-duty price andtherefore Excise Duty was not collected on that component and as a result ExciseDuty was not collected from their customers and duty incidence was not passed on.

Under Rule 9B the Assistant Commissioner should have allowed refund of Rs.14,10,371/- while passing the finalization order on 17.04.1997, since the refundclaims filed on 26.07.1993 were pending before him on 17.04.1997. It is found that asper report submitted by Revenue the refund claims were filed on 26.07.1993 i.e.much before the finalization of provisional assessment and within six months from thedate of paying duty for the month of January, 1993 to April, 1993. The proviso to Subrule 5 of Rule 9B of Central Excise Rules, 1944 came into operation w.e.f . 25.06.1999and as held in various case laws relied upon by the appellant during the relevantperiod Section 11B for unjust enrichment was not applicable for refund arising out ofprovisional assessment.

Held that the appellant is entitled for refund of Rs. 14,10,371/- on the basis of refundclaim filed on 26.07.1993. It is directed the Original Authority to pay the appellantrefund of the amount within sixty days from the date on which a copy of this order issubmitted to the office of the Original Authority. The Original Authority shall also takeinto consideration the interest to be paid on the said amount from the date on whichprovision for paying interest on delayed refund came into operation on the statute ofCentral Excise Act, 1944.


CCE Vs Ramsons Casting Pvt Ltd (Dated: November 16, 2016)

CX – Respondent is engaged in manufacture and clearance of Hot Rolled products ofnon-alloy steel and clears a substantial quantity (approx. 80%) to M/s Rajaram SteelIndustries – case of department is that respondent and M/s Rajaram Steel Industriesare related persons since they are "inter-connected undertakings" and, therefore, thetransaction value was rejected and valuation was arrived at based on rule 8 of theValuation Rules, 2000 – Commissioner(A) set aside the order-in-original confirmingthe demand and, therefore, Revenue is in appeal before the CESTAT. Held: Merelybecause the buyer is an inter-connected undertaking, that alone is not sufficient for

holding the respondent and buyer as related persons in terms of section 4 of the CEA,1944 – SCN and o-in-o have not brought any material to establish that therelationship between respondent and buyers company are one of the relationship asprescribed under sub clause (ii), (iii) or (iv) of Section 4(3)(b) of CEA, 1944,therefore, even if it is accepted that the buyer's company are "interconnectedundertaking" of the appellant company, it cannot be treated as ‘related person' interms of Section 4(3)(b) of CEA, 1944 – Transaction value between respondent andM/s Rajaram Steel Industries is correct valuation and the same cannot be disturbed,therefore, valuation under rule 8 of Valuation Rules, 2000 is not applicable –impugned order passed by Commissioner(A) is sustainable and deserves to be upheld– Revenue appeal rejected: CESTAT [para 6, 7]


Maruti Suzuki India Ltd Vs CCE (Dated: August 5, 2016)

CX - Cenvat credit availed by assessee was denied under various categories of inputservices - Substantial portion of this credit relates to construction service - Originalauthority has erred in applying provisions of Rule 2(1) of CCR, 2004 - During therelevant time the definition clearly covered, by inclusive clause, input service inrelation to setting up, modernization, renovation or repair of the factory - The servicesreceived by assessee squarely fall under this category - Denial of credit onconstruction service is not legally sustainable as the period involved is prior toamendment in Rule 2(l) made on 01.04.2011.

Cenvat Credit was also denied to assessee on architect service availed by them inconnection with project planning, designing, consultancy in connection with expansionof their unit at Manesar and also for renovation and repair of the factory - Saidservices are covered within the definition of 'input service' under Rule 2(l) of CCR,2004 - Denial of credit is not justifiable - As all credits taken have been recorded andreported in prescribed returns, assessees are correct in contesting the case forextended period - There is no merit in invoking extended period and imposingpenalty: CESTAT


CCE Vs Mangalam Cement Ltd (Dated: October 21, 2016)

CX - CENVAT - SCN alleged that the credit availed by the respondent on miningservice and excavation service which are related to extraction of limestone from theirmines are not eligible for input service credit as the said service is not covered by theprovisions of Rule 2(l) of the CCR, 2004 - CCE dropped the demands by holding thatthe services are used in relation to procurement of limestone "from their captivemines which is used directly in the manufacture of final product i.e. cement - Revenuein appeal to CESTAT and contends that the respondent are not entitled for availing thecredit of service tax as the services received by them are correctly classifiable under"supply of tangible goods service" - inasmuch as no service tax is required to be paidtill 15.05.2008 on the said services and accordingly no credit can be availed by therespondent on such services. Held: Present plea taken by the Revenue is entirely ondifferent ground not agitated before the lower authority - it is well settled position oflaw that the credit availed by an assessee cannot be denied or varied on the groundthat the classification of service should have been made in a different category by theprovider of service - Variation in the classification or consequent rate of payment ofservice tax is not possible at the end of the recipient of service - appeal which isbeyond the scope of the proceedings concluded against the respondent has no legalbasis and merit - Revenue Appeal dismissed: CESTAT [para 4]


Sunil Sponge Pvt Ltd Vs CCE (Dated: October 5, 2016)

CX - Allegation of clandestine production and removal - appellants should have beenoffered an opportunity to cross examine the persons, who gave statements, whichwere relied upon by the Department - adjudicating authority cannot straight away relyupon the statement recorded during investigation unless the condition set out thereinviz. s.9D of CEA, 1944 are fulfilled - wherever the figures are to their advantage tosupport the allegation of Revenue, those figures were selectively taken in respect ofsome of the selective days to arrive at a calculation - impugned order suffers fromvarious inconsistencies with reference to appraisal of facts and also due to violation ofprinciples of natural justice - Order set aside and matter remanded: CESTAT [para 6to 9]


Flint Group India Pvt Ltd Vs CCE (Dated: August 17, 2016)

Central Excise - CENVAT Credit - Assessee is entitled to take credit on Education Cessand Special additional duty paid on inputs procured from 100% EOU.

Appellant procured inputs from 100% EOU which cleared the goods on payment ofduty in terms of Notification No. 23/2003-CE dt. 31.3.2003 and appellant availedcredit of duties paid by them to 100% EOU, which was denied - In various precedentsincluding in appellant's own case it self, it was held that assessee is entitled to takecredit on education Cess and special additional duty paid on inputs procured from100% EOU. And restriction imposed u/r. 3(7)(a) of CCR, 2004 is not applicable insuch cases -Hence, impugned order is set aside - Appeal allowed. [paras 1, 3, 4]


Hindustan Zinc Ltd Vs CCE (Dated: September 29, 2016)

CX - Issue relates to Cenvat credit availed on acetylene and oxygen gas - Assesseehas used acetylene as well as oxygen gas for purposes of welding carried out inprocess of repair and maintenance of machinery in their factory - It is found thatearlier in assessee's own case specific issue has been decided in their favour -Impugned order set aside and appeal allowed: CESTAT


Tidland Web Accessories Pvt Ltd Vs CCE (Dated: August 29, 2016)

CX - SSI notification - 8/1998-CE, 8/1999-CE, 8/2000-CE, 8/2001-CE, 8/2002 and8/2003-CE - Para 4 - "Brand name" - Mentioning part number on Air shaft/Air chucksand the brand 'TIDLAND' on letterhead, invoices and catalogues does not amount touse of "brand name" so as to be held ineligible for the benefit of SSI exemptionnotification - Impugned order set aside and appeals allowed: CESTAT [para 6, 8, 11,13, 14]



Samar Dyestuff Pvt Ltd Vs CCE (Dated: December 19, 2016)

CX - Adjudicating authority denied SSI exemption and confirmed the CE duty demandonly on the ground that the appellant before availing the exemption notfn. 9/2000-CEdid not file the declaration for option of the notification and non-availment of MODVATcredit as required under the notification - appeal to CESTAT.

Held: Non-filing of declaration is only a procedural lapse and on account of non-compliance of the same, substantial benefit of SSI exemption cannot be denied -except the said lapse, there is no other lapse on the part of the appellant nor anyallegation to that effect - exemption notification cannot be denied only for want ofdeclaration - impugned order set aside and appeal allowed: CESTAT [para 4, 5]


Anand Engineers Pvt Ltd Vs CCE (Dated: December 19, 2016)

CX - Whether the amounts recovered for providing of drawings and documents inrespect of the goods manufactured and supplied by the appellant is includable in theassessable value of the goods.

Held: It is observed from the contract that these drawings are not used for thepurpose of manufacturing of the goods manufacture by them because the pipingdrawings is for laying of pipes which has taken place at the site only and thefabrication drawing is related to goods for construction and the construction also takesplace at the site - As drawings of both the items are not related to or not required forthe manufacture, their values are not includable in the assessable value - Impugnedorder set aside and appeals allowed: CESTAT [para 6]


Trilok Ship Breakers Ltd Vs CCE (Dated: August 3, 2016)

CX - CENVAT credit of Education Cess paid on imports.

Held: Board has in Circular no.5/2005-Cus clarified that in the case of imports underDEPB scheme, the Education Cess @2% would also be debited from the DEPB scripand vide Circular 18/2006-Cus has advised that the duty debited through DEPB wouldbe eligible for CENVAT credit - demand does not sustain - impugned order set asideand appeal allowed: CESTAT [para 2, 3]

2017-TIOL-197-CESTAT-AHM

Gujarat State Fertilizers And Chemicals Ltd Vs CCE, C & ST (Dated: November23, 2016)

CX - Assessee engaged in manufacture of Fertilizers and Chemicals - Assessee doesnot dispute the inadmissibility of credit availed on ST paid on such input services usedin residential colony - They disputed a portion of demand on the ground of limitation -In as much as on the very same issue of eligibility of Cenvat Credit on securityservices, audit had raised objection in year 2008, therefore, it cannot be said thatassessee had suppressed the facts in availing credit on such input services fromknowledge of department - Accordingly, extended period of limitation cannot beinvoked against assessee in view of principle laid by Supreme Court in PragathiConcrete Products' 2015-TIOL-223-SC-CX - Penalty has been imposed under Rule 15(2) of CCR, 2004 alleging suppression of facts, which is not sustainable: CESTAT


CCE Vs Pragati Hightech Product Pvt Ltd (Dated: September 19, 2016)

Central Excise - Plywood laminated with plasticized paper during 01.07.2004 to28.02.2005 - Held is classifiable under Chapter Heading 44.08 of the erstwhile firstschedule to CETA 1985 and cannot be treated as article of wood under Heading 4410 -Impugned order of the Commissioner holding that goods in question are classifiable asarticles of wood is erroneous hence is set aside - Demand of duty along with interestand penalties upheld. (Para 4, 5) - Revenue appeal allowed: CHANDIGARH CESTAT



Ambuja Cements Ltd Vs CCE (Dated: December 19, 2016)

CX - Assessee engaged in manufacture of Cement and Clinker and was clearing thesame, inter alia,to various buyers - Such buyers included manufacturer of excisableitems, construction service providers, Government Departments and Charitableinstitutions/trusts - Some of the cement was also used for self-consumption and forquality control - Following the decisions in case of Grasim Industries Ltd. 2008-TOIL-2328-CESTAT-MAD and Heidelberg Cement and Ultra Tech Cement Ltd 2014-TOIL-1433-CESTAT-MUM, the assessee would be eligible for the benefit of Notification No.4/2006 under Sr. No. 1C of the table annexed to it: CESTAT


CCE Vs Maihar Cement (Dated: December 28, 2016)

CX - Assessee engaged in manufacture of cement liable to duty - Appeal filed byrevenue against impugned order and only reason mentioned by them is that originalauthority relied on Board Circular dated 12.06.2008 and decision of Tribunal in GrasimIndustries Ltd. 2008-TIOL-2328-CESTAT-DEL - Revenue has not produced anyevidence regarding decision of High Court or Supreme Court overruling the Tribunaldecision in Grasim Industries - Further, it is not correct for Revenue to say thatcircular will be applicable only to some portion of country and should not be reliedupon by others - Sales made directly to various actual users will not be covered bycategory of "retail sale", on this ground also appeal by Revenue has no merit: CESTAT


Mangalam Cement Ltd Vs CCE & ST (Dated: January 3, 2017)

CX – CENVAT credit taken on steel items namely, M.S. Channels, M.S. Plates, M.S.Flats etc. denied on the ground that the said goods are not inputs used in or inrelation to manufacture of the final product and by relying on LB decision in VandanaGlobal - 2010-TIOL-624-CESTAT-DEL-LB . – appeal to CESTAT.

Held: Since the issue involved in this case is prior to July 2009, the amendeddefinition of 'input' with effect from 07.07.2009 is not applicable to the facts of thiscase - issue involved in this case is squarely covered by the decision in Mundra Portsand Special Economic Zone Limited - 2015-TIOL-1288-HC-Ahm , M/s. SinghalEnterprises Pvt. Limited - 2016-TIOL-2451-CESTAT-DEL , M/s. Topworth Steels andPowers Pvt. Ltd. - 2016-TIOL-2389-CESTAT-DEL , Monnet Ispat & Energy Ltd. - 2015-TIOL-2850-CESTAT-DEL , M/s. Petropole India Limited and Monnet Ispat and EnergyLimited - 2016-TIOL-1934-CESTAT-DEL – no merit in impugned order – appeal

allowed with consequential relief: CESTAT [para 5]


Zydus Nycomed Healthcare Pvt Ltd Vs CCE (Dated: August 28, 2016)

CX - CENVAT - Rule 2(l) of CCR, 2004 - Commercial and Industrial ConstructionService (CICS) utilised for establishment of a plant is not an Input service: CESTAT[para 4, 5]



CCE Vs Sunshine Jewellers Ltd (Dated: December 2, 2016)

CX - Respondent is engaged in the manufacture of imitation jewellery for which theyare using Gold Potassium Cyanide (GPC) manufactured in their factory as anintermediate product - prior to 31.03.2001, imitation jewellery was not attracting dutyand, therefore, department demanded CE duty on GPC - Rs.1,53,91,800/- wasdeposited by appellant and subsequently a section 11C notification 51/2003-CE(NT)was issued granting exemption to GPC with retrospective effect - appellant filingrefund claim and which was sanctioned by Dy. Commissioner - Revenue appeal wasrejected by Commissioner(A), therefore, department has filed appeal in CESTAT.

Held: Commissioner(A) has while disposing of the department appeal consideredvarious judgments/factum of unjust enrichment and come to the conclusion thatsanction order of the original authority is proper and Revenue appeal fails on allgrounds - Bench is in complete agreement with the findings and is of the view that thesame does not require any interference - Impugned order upheld and Revenue appealdismissed: CESTAT [para 4]


V-Trans (India) Ltd Vs CCE (Dated: November 28, 2016)

CX - Penalty of Rs.75,000/- imposed u/r 26 of CER, 2002 on appellant on the groundthat the appellant being a regular transporter had prepared consignment note fordelivery of the goods at Moradabad and consequently the said goods were delivered atSurat - appeal to CESTAT.

Held: In the entire o-in-o running into 87 pages, no findings have been recorded byadjudicating authority as to how the appellant had abetted or violated the provisionsof CER, 2002 - appellant being a regular transporter had documents liked CT-3, exciseinvoices which were indicating that delivery should be made at Moradabad whilegoods were delivered at Surat - Provisions of rule 26 would get attracted only if anyperson who acquires possession of, or is in anyway concerned in transporting,removing, depositing, keeping, concealing, selling or purchasing, or in any othermanner deals with any excisable goods which he knows or has reason to believe areliable for confiscation - appellant, being a transporter, documents like excise invoicewere available with him - penalty, therefore, is not imposable - impugned order setaside and appeal is allowed: CESTAT [para 4, 5]


SMG International Vs CCE (Dated: September 16, 2016)

CX - Refund - In remand proceedings, refund claim was rejected by adjudicatingauthority on the ground that assessee has failed to pass the bar of unjust enrichment- Assessee has not recovered any amount towards the amount reversed from buyersand to that extent the buyer has issued debit note to assessee during relevant period- Assessee has been able to pass the bar of unjust enrichment - Accordingly,impugned order deserves no merit and same is set aside: CESTAT


CCE Vs PTC Impex India Pvt Ltd (Dated: October 17, 2016)

CX - Allegation against assessee is that they imported duty free cloves for use inmanufacture of spices - In absence of any positive evidence, these pieces of allegedcorroboration cannot by themselves legally sustain the allegation of diversion of hugequantity of imported duty free cloves - In appeal, Revenue has not brought out anymaterial evidence, which will prompt Tribunal to interfere with impugned order - ShriDeepak Kumar Agarwal was issued with SCN for imposing penalty under Rule 26 ofCER, 2002 - Allegation against him is that he is a major buyer of productmanufactured by assessee and he tried to mis-lead the Department and hamper theinvestigation by creating firms in name of dummy owners and in collusion with others- In view of main conclusion arrived at by Original Authority, no penalty could beimposed on Shri Deepak Kumar Agarwal: CESTAT


CCE Vs Steel Abrasives (Dated: October 7, 2016)

Central Excise - Clandestine clearances - assessee is a manufacturer of iron and steelitems such as steel shorts, CI shots and MS ingots etc. - departmental officers visitedtheir factory, verified inputs as well as finished products and found shortages;investigated / examined records and concluded that the assessee has cleared inputson which Cenvat credit have been taken as well as some finished productsclandestinely without payment of duty - demands confirmed in adjudication withinterest and penalty, set aside by Commissioner (Appeals), and agitated by Revenueherein.

Held: The verification of stock of raw materials as well as finished products resulted inshortages detected in the stock of raw materials as well as finished products - Themanner of stock taking was to the satisfaction of the Director who was presentthroughout the proceedings; who admitted the shortages - the duty due on rawmaterials as well as the finished product found short stand already paid - Severalloose sheets as well as six private note books have been recovered, and the entiredemand is based on the entries found in the note book as well as on the confessionalstatement of the Director, who was shown the reconciliation worksheets / charts - theDirector has admitted that the notebooks contained details of clearances of rawmaterial and finished products (both on payment of duty and otherwise); receipt ofunaccounted raw materials; and clearances listed out in the charts as having beenmade without payment of duty - the statement of Director is the basis for thedemand; it is inculpatory and is specific -the Commissioner (Appeals) has erred intaking the view that there is not enough evidence of clandestine removal of goods.[Para 12-15]

The evidence of clandestine clearance has been brought on record only as a result ofinvestigation undertaken by the department - Therefore this is a clear case ofsuppression of facts from the department and the extended period of limitation isinvocable - the Commissioner (Appeals) order setting aside the demand is not proper,inasmuch as the demand is based on evidence which stands admitted by Directorbased on private records recovered from the assesses' factory - There is nothing onrecord to the effect that statements relied upon have been extracted under duress -

duty also stands demanded only on those clearances which are not covered byinvoices - the impugned order is set aside. [Para 16, 18, 19]


CCE Vs Murli Agro Products Ltd (Dated: December 6, 2016)

CX - Case of the department is that Hexane was procured under Notificationno.43/2001-CE(NT) which is not only used for manufacture of De-oiled Cake (DOC)but also used for manufacture of oil which is not exported – duty free benefit deniedbut Commissioner(A) allowing the appeal – Revenue before CESTAT.

Held: During the manufacture of DOC, soyabean oil is generated and which isunavoidable – in this view of the matter, it cannot be said that Hexane which isprocured duty free is not used for manufacture of DOC – no apparent violation ofnotification or the rules made thereunder – in appellant's own case, benefit has beenextended earlier – impugned order upheld and Revenue appeal dismissed: CESTAT[para 5]


SKF Sealing Solutions Pvt Ltd Vs CCE (Dated: August 23, 2016)

Central Excise - CENVAT Credit - Cenvat credit is admissible on input services of out-door catering, rent-a-cab, hotel booking expenses and car maintenance services asthey are directly related to appellant's business of manufacture.

Cenvat credit denied on impugned input services on the ground that they are notdirectly or indirectly related to the business of manufacture and so are not coveredunder the definition of input services u/r. 2(I) of CCR, 2004 - Issue is no more resintegra and various precedents including in appellant's own case have held that thecredit is admissible on all impugned input services as they are directly related toappellant's business of manufacture - Hence, appeal allowed. [paras 2, 3, 4]


Agrofab Machineries India Ltd Vs CCE (Dated: January 2, 2017)

CX - Cess cannot be considered to be a duty of excise for the purpose of notification214/86-CE - Benefit of exemption not available to job worker who manufactures 'RearAxle Carrier sub assembly' of exempted Tractors - Undertaking filed under NotificationNo. 214/86 is not procedural requirement but a substantial requirement - Penaltiesare excessive, hence reduced - Appeals partly allowed: CESTAT [para 4.1 to 4.8, 5]



Shree Ambe Mata Industries Vs CCE & C (Dated: October 7, 2016)

CX - Lack of statutory provision for grant of refund of credit lying unutilized at thetime of closure of a factory and the lack of safeguards, conditions and limitations tohandle such eventuality – claim rightly rejected: CESTAT [para 13, 14, 16, 18]



Rathi Steels Ltd Vs CCE (Dated: October 7, 2016)

Central Excise -Goods returned from the SEZ Developer - Appellant entitled to takecredit: The issue in this appeal is whether the appellant manufacturer who clearedfinished goods to SEZ Developer under bond without payment of duty and the samewere again returned to the appellant by the SEZ Developer under bonded Challan forreplacement, and on failure of the appellant to replace in the time permitted the SEZDeveloper deposited the Excise duty, and claimed reimbursement from appellant, thesame was taken credit of by the appellant, whether the said credit was rightly takenby the appellant. - Para 2

It is undisputed fact that the goods were removed under bond under the procedureand permissible under law. Further, the goods were again received back, beingdefective, under proper procedure and permission. Further, the duty was paid by theSEZ Developer on non-fulfillment of the condition of the bond, as the appellant couldnot return the goods within the stipulated time. Such duty was admittedly paid,although under wrong head (Customs duty) and the same have been accepted by theappellant. Accordingly, the procedure of Rule 16 of Central Excise Rules, 2002 doesnot come in the way in denying the credit. The appellant is entitled to take creditunder Rule 3 of the Cenvat Credit Rules as they have admittedly received the goodsunder proper documents reflecting the duty involved and the said duty have beenadmittedly paid on the removal of the goods, being the SEZ Developer, to theappellant. Accordingly, the appeal is allowed and the impugned order is set aside. Theappellant is held entitled to take the Cenvat credit of the duty of Rs.10,57,084/-. -Para 7


Federal Mogul Tpr (India) Ltd Vs CC & ST (Dated: August 22, 2016)

Central Excise - CENVAT Credit - For the purpose of availing credit by servicerecipient, there is no requirement that the service tax should have been deposited byservice provider before availment of credit on the same by service recipient.Revenue's remedy for delayed payment lies at the end of service provider but not atservice recipient.

Credit availed by assessee on input services received was held to be irregular for theperiod for which the payment of such service tax to Govt., was delayed by the serviceprovider - Commissioner dropped the proceedings but imposed penalty and interestfor delayed period - Appellant's submission that service recipient is entitled to takecredit of service tax paid on input services immediately upon having paid the invoiceof service provider and there is no requirement to await the actual payment of tax byservice provider, is acceptable - Precedents have held that for the purpose of availingthe credit, there is no requirement that the service tax should have been deposited byservice provider before availment of credit by service recipient - Service recipient isentitled to avail credit without finding whether the service tax paid by him to theservice provider stands further deposited by him to exchequer - It is neither possiblenor practical for any service recipient to verify the fact of payment of tax by serviceprovider - Revenue's remedy for delayed payment lies at the end of service providerbut not at service recipient - Moreover, imposition of penalty u/r. 15(2) of CCR is alsonot legal in view of the precedents - Appeal allowed. [paras 1, 2, 3]


Delco India Pvt Ltd Vs CCE (Dated: December 22, 2016)

CX - Penalty - Duty demand has arisen on account of clandestine clearance of goods -Such fact has also not been disputed and is admitted - Consequently, Tribunal haveno discretion in respect of penalties imposed on Section 11AC - Therefore, same isupheld - Shri S.K. Bansal, director of assessee, has involved himself in evasion ofExcise duty by clandestine clearance of goods - It appears that he was not activelyinvolved in activities but he cannot deny his responsibility - Hence, penalty isimposable under Rule 26 of CER, 2002 and same is reduced to Rs 50,000/-: CESTAT


Montage Enterprises Pvt Ltd Vs CCE (Dated: July 4, 2016)

Central Excise - Cenvat Credit on Capital Goods - Capital Goods cleared after a periodof use - Not clearance as such : The issue in this appeal by the manufacturingassessee is whether they are liable to pay, by way of reversal, the amount of Cenvatcredit taken at the time of acquisition of the capital assets which has been admittedlycleared subsequently, after a period of use, and paid the duty on the transactionvalue. Further, issue involved is whether extended period of limitation is invokableunder the facts and circumstances.

The provisions relating to proportionate depreciation came vide notification with effectfrom 13/11/2007. The Madras High Court in the case of Commissioner of CentralExcise, Coimbatore Vs. Lakshmi Machine Works Ltd. reported in - 2015-TIOL-728-HC-MAD-CX held, where the capital assets are removed after a period of use it does notamount to removal as such. The issue in this appeal is squarely covered by the Rulingof High Courts, in favour of the appellant. - para 6.

Held: Removal of capital assets by the appellant in the present appeal is not removalas such and accordingly, held that no duty was required to be paid by way of reversal,as demanded by the revenue, being the amount in dispute. The appellant will beentitled to refund of the amounts deposited. The impugned demand, interest andpenalties are set aside. The appeal stands allowed with consequential benefits, if any.- para 6.


Molex India Pvt Ltd Vs CCE (Dated: August 30, 2016)

Central Excise - CENVAT Credit - Assessee-manufacturer who has procured inputsfrom 100% EOU on which the EOU has discharged duty u/s. 3(1) of CEA, is entitled totake credit in full. Because duty discharged by 100% EOU u/s. 3(1) of CEA is a duty ofexcise and is one single amount, which cannot be bifurcated in to different customsduties though the method for calculating the measure of such excise duty was also toinclude element of customs duties. And Rule 3(1) of CCR, 2004 allows credit of thewhole of the duty charged by EOU u/s. 3(1) of CEA.

Appellant-manufacturer procured inputs from 100% EOU, on which EOU had paidexcise duty u/s. 3(1)(ii) of CEA - Revenue took view that such duty paid by EOU is notavailable to appellant as credit in full and restricted the credit to the amount, which isequivalent to basic customs duty - Appellant contends that duty paid by EOU u/s. 3(1)of CEA is a duty of excise and Rule 3(1) of CCR, 2004 allows credit of the whole of theduty charged by EOU u/s. 3(1) - From the perusal of Section 3(1) of CEA and Rule3(1) of CCR, it is clear that duty charged by 100% EOU is a duty of excise and theamount charged is one single amount and does not contain any bifurcation as to basiccustoms duty, additional customs duty, etc., - It is seen that invoices issued by thesupplier indicate excise duty as per the proviso to Section 3(1), where only centralexcise duty has been prescribed to be calculated in a particular manner - Hence,Revenue was wrong in bifurcating the central excise duty paid into basic customs dutyand education cess - Though the method for calculating the measure of such excise

duty was also to include element of customs duties but the entire duty paid on theinvoices will have to be considered as central excise duty paid u/s. 3(1) - Hence, inview of the precedents, demand is not sustainable and is set aside - Appeal allowed.[paras 1, 32, 4, 4.1]


Skoda Auto India Pvt Ltd Vs CCE (Dated: December 6, 2016)

CX - Appellant clearing MV on payment of duty to ARAI for testing and after return ofthe MV availing CENVAT credit and carrying out processes of checking of Fluid level,AC performance, electrical systems - since processes do not amount to manufacture,appellant to pay duty equivalent to credit availed and not on transaction value - as nomalafides can be attributed, demand to be confirmed only for the normal period oflimitation - Penalty of Rs.25,000/- maintained in view of Tribunal order dated16.03.2007 passed in Revenue appeal - appeal disposed of: CESTAT [para 4]



Porwal Industries Vs CCE (Dated: December 6, 2016)

CX – Issue is whether unutilized deemed credit lying in balance and availed underNotification NO. 6/2002-CE (NT) dt. 1.3.2002 will be allowed to be utilized forclearance of goods after 1.4.2003 in the light of Notification No. 8/2003-CE(NT) dt.1.3.2003 by which provision of deemed credit was withdrawn.

Held: Issue is no longer res integra - Accumulated deemed credit lying on 31.3.2003was admittedly availed prior to that date when the Notification NO. 6/2002-CE (NT)was in force – Therefore, the credit was availed under the authority of law - There wasno provision either for lapsing the accumulated credit balance lying as on 31.3.2003or reversal thereof - In this situation, in the absence of any provision the credit whichwas legally availed, cannot be held to lapse or sought to be reversed – impugnedorder set aside and appeal allowed: CESTAT [para 4]


Grovers Private Ltd Vs CCE (Dated: December 19, 2016)

CX – Differential CE duty was demanded on the ground that the appellants haverecovered transportation charges towards the supply of their excisable goods by wayof debit notes issued and such value cannot be deducted from the AV since notmentioned in the invoices – appeal to CESTAT.

Held: Although as per procedure the amount of transportation cost should be shown inthe invoices, however, the objective of showing the same is to identify the amount oftransportation charges for allowing the deduction thereof – whether it is shown in theinvoices or if it is recovered by way of debit notes, both are one and the same –merely because the transportation charges were recovered by way of debit notes, thesame should not be disallowed as deduction for the purpose of charging excise duty –impugned order set aside and appeal allowed: CESTAT [para 4]


KEI Industries Ltd Vs CCE (Dated: November 28, 2016)

CX - Whether the appellants are entitled for exemption in terms of notification 67/95-CE or are liable to pay duty on intermediate product i.e. armoured cable, which hasbeen used for manufacture of power cables which is ultimately cleared on payment ofduty in the open market and to Mega Power Projects without payment of duty clearedagainst international competitive bidding in terms of Notification No. 6/2006-C.E.

Held: In view of the provisions of Rule 6(6)(vii) of the CCR, 2004, the appellant didnot have any liability under sub-rule (2) to maintain separate accounts for receipt,consumption and inventory of inputs meant for use in the manufacture of dutiablefinal products and inputs meant for use in the manufacture of exempted goods, nordid the assessee have alternative liability under sub-rule (3) to pay an amount equalto 10% of the value of the exempted goods - a conjoint reading of sub-rule (6) ofRule 6 of the CENVAT Credit Rules, 2004 and clause (vi) under the proviso toNotification No. 67/95-C.E. ibid would show that the assessee's claim for exemptionfrom payment of duty on copper wire under the Notification was not hit by theopening portion of the proviso to the Notification – In these circumstances, theappellant is entitled for benefit of notification No. 67/1995-CE ibid for intermediateproduct emerging during the course of manufacture of final product - impugnedorders deserves no merits, hence same are set aside – Appeals allowed withconsequential relief: CESTAT [para 8 to 10]


Chandra Cement Ltd Vs CCE (Dated: November 25, 2016)

CX - Clandestine removal of Cement without payment of duty - demand confirmedalong with interest and penalty on company and Director - appeal to CESTAT.

Held: There are enough corroborative evidences viz. Cash Books resumed, Parallelinvoices resumed, Weighment slips resumed, Registers of parties resumed on recordto sustain the charges of clandestine removal against the appellants - findings givenby the adjudicating authority in the impugned order are based on clear cut evidencesand, therefore, there is no scope of interference with the same - considering thetotality of the facts and circumstances of the case, the impugned order is sustainedand the appeals are dismissed: CESTAT [para 7.1, 8]


Hi Cure Pharmaceuticals Pvt Ltd Vs CCE (Dated: August 30, 2016)

Central Excise - Valuation - Since job-worker has already paid duty on entire quantitycleared, which included free supply quantity, now demanding duty again on quantitydiscount by disallowing the same on the ground that such removal of goods did notinvolve sale, would tantamount to subjecting the goods to duty twice, which is notpermitted by law.

Revenue took view that removal of goods by appellant-job-worker to principalmanufacturer did not involve sale and so no quantitative discounts would be allowedand as such the declared value was on lower side - AA dropped the proceedings -Commissioner (A) set aside the OIO - Precedent has held that assessed value of theprocessed fabric would be the value of gray cloth in the hands of the processor and;the value of job work done plus manufacturing expenses and profits will either beincluded in the price at factory gate or deemed factory gate for the processed fabric -From the invoices, it is seen that the quantity of medicines cleared from appellant asquantitative discount was known at the time of clearance at the factory gate - It ispertinent to note that AA has observed that in respect of the same unit, for earlier

period, the same AA has held that job-worker cannot be held to have acted asagent/hired labour of principal manufacturer or with agreement on principal toprincipal basis; and that the method of valuation adopted by appellant is inaccordance with the CBEC Circular and hence dropped the proceedings - But,Commissioner (A) without any basis has held that there is no sale in the transactionand as such discount cannot be allowed - In view of the facts and precedent, it is clearthat appellant had discharged duty liability on the value arrived at in accordance withwell settled principles of law - Since appellant has already paid duty on entire quantitycleared, which included free supply quantity, now demanding duty again on quantitydiscount would tantamount to subjecting the goods to duty twice, which is notpermitted by law - Hence, appeal allowed. [paras 2, 4, 5]


Heat Flex Cable Pvt Ltd Vs CCE & ST (Dated: January 3, 2017)

Central Excise - Cenvat Credit - Inputs not manufactured by the input supplier byprocured from open market - No cenvat Credit: The dispute is with respect to Cenvatcredit amounting to Rs. 1,94,690/- availed by the appellant on the basis of invoicesissued by the input supplier Even though the input supplier is a manufacturer of PVCcompound but the investigation undertaken by Revenue has established that, inrespect of 10 invoices issued by them and based on which Cenvat credit have beenavailed, have not been manufactured by them. It is further established that thesegoods stand procured from the open market and supplied as the same have beenmanufactured by them. The Director of the appellant also has admitted in thestatement before the Revenue authorities that the Director of input supplier had toldhim that the material being supplied was procured by them from some other sources.Once it has been established that the goods covered by the 10 invoices were notactually manufactured by the input supplier but were procured from outside, Cenvatcredits availed on the basis of those 10 invoices will not be proper. - para 5



Manglam Cement Ltd Vs CCE (Dated: November 16, 2016)

CX - CENVAT - Appellant, manufacturer of Cement, availed Cenvat credit of duty paidon various structural/ steel items like TMT bars, coil, steel tubes and pipes, modifiedarmor plate, rectangular bar, PCC chequred plate, chain conveyor etc. - credit deniedby adjudicating authority - appeal to CESTAT.

Held: Apex court in the case of Rajasthan Spinning & Weaving Mills Ltd. - 2010-TIOL-51-SC-CX, has considered an identical issue of steel plates and MS channels used inthe erection of chimney for diesel generating set and extended the credit in thecontext of rule 57Q of CER - applying the 'User Test' envisaged in Jawahar Mills Ltd. -2002-TIOL-87-SC-CX to the facts in hand, Bench has no hesitation in holding that thestructural items used in the fabrication of support structures would fall within theambit of 'capital goods' as contemplated under Rule 2(a) of the CCR, hence will beentitled to the Cenvat credit - impugned order set aside and appeal allowed: CESTAT[para 4, 5]


Hunsur Plywood Works Pvt Ltd Vs CCE (Dated: August 23, 2016)

Central Excise - CENVAT Credit - Precedents have clearly held that Sawdust and

waste/scrap of wood cleared at nil rate of duty are not manufactured goods or finalproducts but are 'waste products' and that the Rule 6 of CCR, 2004 which requiresreversal of 5% of value of exempted goods is not applicable to waste/scrap, by-products, etc.,

Demand raised on the ground that in respect of Saw dust and waste/scrap of woodwhich were cleared at nil rate of duty as waste products, assessee should pay 5% ofvalue of exempted goods u/r. 6(3)(i) of CCR, 2004 - Precedents have held that Sawdust and waste/scrap of wood are not manufactured goods or final products but are'waste products' that arise during the course of manufacture of dutiable final productsand; that the Rule 6 is not applicable to waste products - Hence, impugned order isset aside -Appeal allowed. [paras 2, 3, 4]


Metal Rolling Works Ltd Vs CCE (Dated: December 1, 2016)

CX - Appellants procured aluminium scrap for manufacture of circles directly from themanufacturer, namely, Lallubhai Amichand,, who have cleared the same by claimingfull exemption and which fact is undisputed - Demand of CE duty confirmed bydenying the benefit of exemption notification 182/84-CE on the ground that rawmaterials have not suffered any duty - appeal to CESTAT. Held: Apex Court in thecase of Ratan Melting - 2008-TIOL-194-SC-CX-CB has asserted that the SC decisiontakes precedence over the departmental clarification; that a Circular which is contraryto the statutory provisions has really no existence in law - appellant has not disputedthe applicability of the decision in Dhiren Chemical Industries - 2002-TIOL-83-SC-CX-CB - Appeal dismissed: CESTAT [para 4, 5]


Reliance Infocomm Ltd Vs CCE (Dated: December 19, 2016)

CX - Appellant engaged in providing telephone services - For providing these services,they have by purchasing various equipments, erected and installed transmissiontowers i.e. Base Transceivers Station (BTS), and Base Station Controller (BSC) -department has demanded excise duty on such towers by treating it as manufactureof excisable goods - appeal to CESTAT. Held: Issue is no longer res integra - appellanthave erected and installed various telecommunication towers such as BTS/BSC, withbought out items - On assembly, erection and installation, the tower becomeimmovable goods, therefore, they are not excisable goods and hence not liable toduty - Impugned order set aside and appeals allowed: CESTAT [para 4]


Thakor Electronics Ltd Vs CCE (Dated: December 2, 2016)

CX - SSI exemption - Appellant took over the factory of Thermax Electronics Ltd.which closed its manufacturing activities from April 2001 - Appellant obtaining freshregistration on 18/12/2001 - Exemption claimed under notification 9/2001-CE,9/2002-CE during the FY 2001-2002 ad 2002-2003 denied on the ground that uponadding the aggregate value of clearance of Thermax Electronics Ltd. in the value ofthe clearances of appellant, the aggregate value exceeds Rs.3 crores. Held: Lowerauthorities did not verify the facts and even it was not brought on records as towhether there is any clearance of Thermax Electronics Ltd. and if yes, then what isthe value of their clearances - Unless and until this fact is brought on record, it cannotbe said whether the value exceeded the aggregate value of 3.00 crores or theexemption limit - matter remanded to the original authority for passing fresh order:CESTAT [para 5]


Excel Tyre And Rubber Products Vs CCE (Dated: August 24, 2016)

Central Excise - Interest - Assessee is not liable to pay interest on delayed payment ofduty either u/s. 11AA or 11AB as the related clearances have effected much beforethe introduction of the Sections in to the Central Excise Act. Moreover, impugnedorder setting up a new case on behalf of Revenue, which is there neither in SCN nor inOIO, is not sustainable.

Duty demand confirmed for the period 1984 to 19889 was paid through installmentstill 2010 - Since Section 11AA was introduced w.e.f 16.5.1995 into CEA whichstipulates that interest is chargeable on delayed payment of duty after three monthsfrom the date of determination of duty liability u/s. 11A(2), interest demand raisedu/s. 11AA for delayed payment - Appellant paid it and filed for refund contending thatSection 11AA introduced w.e.f 16.5.1995 would be applicable only for the dutypayable for the clearances made after that date and CBEC Circular clarified thatSection 11AB is applicable only for clearances made after the introduction of theSection - OIO rejected refund claim holding that Section 11AA applies retrospectivelyand the Circular is only in respect of Section 11AB - However, Commissioner (A) afterholding in favour of appellant that Section 11AA is not applicable in the case, rejectedrefund claim holding that interest is payable u/s. 11AB - Appellant contends thatCommissioner (A) has traveled beyond the SCN by rejecting the claim on a completelynew ground and; that they are not liable to pay interest either in terms of Section11AA or 11AB.

Revenue's contention that interest liability is retrospective in nature and interest u/s.11AB can be demanded even if it is not proposed in SCN, is not tenable - All along theproceedings, revenue's case was that appellant was liable to pay interest u/s. 11AAand is not liable u/s. 11AB - So, now interest cannot be demanded u/s. 11AB whichwas never resorted to in the SCN and OIO - Impugned order setting up a new case onbehalf of Revenue is not sustainable as held by various precedents - Even the CBECCircular dt. 26.8.2002, which is binding on Revenue stipulates that Section 11AB isapplicable only to the clearances made after 28.9.1996, irrespective of the date ofadjudication order and in the case the clearances are much before 1996 - Hence,impugned order set aside - Appeal allowed. [paras 1, 2, 4, 5, 6]


Elppe Chemicals Pvt Ltd Vs CCE (Dated: August 2, 2016)

CX - CENVAT - Recovery of CENVAT credit availed in respect of 'furnace oil' used forjob work undertaken by appellant.

Held: Issue is squarely covered by the decision of the Larger Bench in the case ofSterlite Industries - 2005-TIOL-305-CESTAT-MUM-LB allowing such credit on theground that although the duty does not get paid at the job worker's end, butultimately gets paid at the supplier manufacturer's end - impugned order set asideand appeal allowed: CESTAT [para 2, 3]


International Conveyors Ltd Vs CCE (Dated: December 1, 2016)

CX - Valuation - Whether cost of packing is includible in AV.

Held: Conveyor belt, in normal course, does not require any packing duringtransportation - however, in the supplies made under the contract, there is a conditionfor packing and that too for safe transportation - this indicates that packing is notmeant for marketing of goods but only for safe transportation - Supreme Court inPonds India Ltd. - 2002-TIOL-392-SC-CX has held that irrespective of the factwhether it is primary or secondary packing but if it is done for transportation of goodsand not for marketing, the same is not includible in the assessable value - impugnedorder set aside and appeal allowed: CESTAT [para 6, 7]


Khanna Industrial Pipes Pvt Ltd Vs CCE (Dated: November 4, 2016)

CX - CENVAT - Appellant availed cenvat credit in respect of CHA service received forthe purpose of export of goods - Revenue taking a stand that since the place ofremoval is factory gate, therefore, any services received beyond the place of removalis not entitled for CENVAT credit - appeal to CESTAT.

Held: It has been held by the Tribunal in various judgments that in case of export, theport of export is treated as place of removal - as the CHA service is provided upto theport of export, hence the same is admissible as input service - credit allowed -Impugned order is set aside and appeal is allowed: CESTAT [para 4]


Shree Krishna Paper Mills And Industries Ltd Vs CCE (Dated: October 5,2016)

CX - Appellants are engaged in the manufacture of writing paper and news print paper(Tariff rate Nil) and availing CENVAT credit on inputs and input services - From01/04/08 they have started availing exemption under Notification No. 4/2006-CEdated 01/3/2006 in respect of writing paper - Revenue alleging that credit on inputsand input services availed for the period prior to 01/04/08, but lying in balance as on01/04/08, is also to lapse - appeal to CESTAT.

Held: Once the credit is legally taken and utilized on the dutiable final product, it neednot be reversed on the final product being exempted subsequently - Credit on inputsand input services availed for the period prior to 01/04/08 but lying in balance as on01/04/08 will not lapse in view of decision in Ranbaxy Laboratories Ltd - 2012-TIOL-281-HC-HP-CX - there is no justification to demand reversal of Cenvat credit alreadyavailed and also lying in books of accounts of the appellant - However, no fresh creditcan be taken from 01/04/2008 on any inputs as the appellants were manufacturingonly exempted goods from that date and they are not covered by the credit schemeduring that period - Penalty reduced as appellant is not liable to reverse/lapse theother credits duly taken but only that availed after 01/04/2008 - Appeal partlyallowed: CESTAT [para 7, 8]


CCE Vs Inven Pharmaceuticals Pvt Ltd (Dated: October 25, 2016)

CX- Alleged unaccounted clearance of pharmaceutical products – demand of CE dutydropped by Commissioner – appeal by Revenue on the ground that the Commissionerdid not give due weightage to the private records resumed during investigation andcorroborated by various statements; that out of total demand of Rs. 53,16,493/-, Rs.28,97,641/- covers duty on I.V. fluids which was dropped by the Original Authority onthe ground that during the period the main respondent had an order in their favour

holding that the said product is covered by exemption Notification No. 36/2002-CEdated 01/03/2002 and, hence, they need not maintain any separate records; thatsince the appeal against the said order is awaiting decision of Tribunal and theclearances referred in the present case are clandestine and unaccounted, theCommissioner could not have held that demand is time barred. Held: Since substantialportion of demand regarding I.V. fluid as contested by the Original Authority ispurportedly involving demands which are already covered by way of periodical noticeswhich was quashed by the Madhya Pradesh High Court, the matter requires factual re-verification; that both the sides were not able to categorically submit, based ondocuments, about the amount of Rs. 28,97,641/- being partly or wholly covered insuch periodical notices; that no supporting evidence is produced; matter requiresverification by the Original Authority for a fresh decision - appeals by the Revenue areallowed by way of remand: CESTAT [para 4, 5]


Carclo Technical Plastics Pvt Ltd Vs CCE, C & ST (Dated: August 25, 2016)

Central Excise - CENVAT Credit - Appellant is entitled to transfer the unutilized Cenvatcredit on conversion from DTA unit into 100% EOU, in view of the precedents.

Precedents have held that 100% EOU is entitled for credit available in books ofaccounts at the time of conversion from DTA unit into 100% EOU and also that 'thereis no provision in CCR, which provides for lapsing of credit on conversion from DTAunit into 100% EOU' - Hence, impugned order which demanded thetransferred/carried forwarded unutilized credit balance from DTA to EOU at the time ofconversion of DTA unit into 100% EOU, is set aside - Appeal allowed. [paras 1, 3, 5]


CCE Vs Crescent Catalyst And Chemicals (Dated: December 30, 2016)

CX - Just as no law, instruction or judgement can prevent a tax collector from levyinga tax in accordance with law, no law, instruction or judgement can be allowed toimpede a tax collector from fulfilling his constitutional obligation to collect only suchtax as is authorized by law - When the duty already collected is in excess of thatleviable, there is no basis for the taxman to allege further short-recovery - Revenueappeal dismissed: CESTAT [para 8 to 12]



Pepsico India Holdings Pvt Ltd Vs CCE (Dated: September 23, 2016)

CX - Issue relates to whether the appellants are liable for duty on thebottlers/samples withdrawn for in-house testing – Duty demands raised andconfirmed of Rs.3726/- and Rs.417/- respectively along with penalties and interest forthe period July, 2005 to June, 2007 – appeal to CESTAT.

Held: Instant issue is squarely covered in favour by the earlier order passed byTribunal in the case of M/s Pepsico India Holdings Pvt. Ltd. Vs. CCE & Customs,Allahabad vide Final Order No. 70341/2016 - 2016-TIOL-2009-CESTAT-ALL dated15.06.2016 in favour of the assessee - following precedent decision, the impugnedorder is set aside and the appeal is allowed with consequential benefits: CESTAT [para5]


Prakash Cotton Mills Pvt Ltd Vs CCE (Dated: November 4, 2016)

CX- Appellant removing worn out parts of capital goods from factory without paymentof duty - demand issued for recovery of CENVAT credit and confirmed/upheld by lowerauthorities - appeal to CESTAT.

Held: From rule 3(4) of CCR, 2002 it is clear that the duty is required to be paid onlyif the capital goods are removed ‘as such' - it is undisputed that worn out parts ofcapital goods were cleared, therefore, in case of used parts/capital goods, rule 3(4) isnot applicable - impugned order is set aside and appeal is allowed: CESTAT [para 4]


Dalmia Bharat Sugar And Industries Ltd Vs CCE, C & ST (Dated: December 9,2016)

CX - CENVAT - Appellant is engaged in production of sugar and molasses and payingexcise duty by utilizing cenvat credit on inputs/input services - In the process ofmanufacturing sugar and molasses, bagasse has been produced which is consumedcaptively for generation of electricity - part of bagasse and electricity generated wassold - Since these are non-excisable goods, appellant did not reverse any commoninput credit attributable to them - in view of retrospective amendment made byFinance Act, 2010, appellant reversed input credit for financial years 2007-08 and2008-09 and 2009-10 and informed Commissioner on 4.11.2010 - Commissionerallowed proportionate reversal of credit for the period upto 31.3.2008 but confirmeddemand of Rs. 5,83,51,319/- for the period subsequent to 31.3.2008 on the groundthat the appellant has not exercised option for reversal of credit under Rule 6(3A) ofCCR, 2004, and, therefore, benefit of the said Rules cannot be given - in anotherorder, Commissioner held that the appellant is not entitled for benefit given in FinanceAct, 2010 to reverse the credit attributable to manufacturing of non-dutiable goods -appeal to CESTAT.

Held: Commissioner is not justified in insisting that appellant reverse cenvat credit interms of Rule 6(3)(i) of CCR - appellant claims that they have already reversed onproportionate basis the cenvat credit along with interest amount payable in terms ofRule 6(3A) - However, the Department is entitled to verify whether reversal of theamount already made by the appellant satisfies the requirement of Rule 6(3)(ii) ofCCR notwithstanding the fact that the procedural formalities have not been satisfied -For this purpose, matter remanded to the original authority: CESTAT [para 8, 9]


Bausch And Lomb Eyecare India Pvt Ltd Vs CCE (Dated: November 10, 2016)

CX - Valuation - Period April 2006 to March 2007 - appellant is engaged in themanufacture of ReNu Lens Care Solution in 120 ml. bottles at the assessable value ofRs.87 per bottle and pays duty thereon - appellant was selling the sample packs ofReNu lens care solution 60 ml bottle to the distributors @ Re. 1 per bottle and paidduty thereon - distributor, in turn, was giving the samples of 60 ml bottle as a part ofthe welcome kit which comprised of lens case and instruction kit and was given alongwith the trial lenses to the customer for free as a marketing strategy to promote salesof the product - issue is whether the value of Re. 1/- adopted by the appellant inrespect of the small bottles of 60 ml of Lens Care Solution is the correct assessable orthe value has to be raised by adopting the value of the full commercial bottle of 120

ml - as demand confirmed, appeal to CESTAT. Held: Identical issue was decided in theassessee's own case - 2015-TIOL-1495-CESTAT-DEL where it is held that entire caseof Revenue for enhancement of the price is based upon the fact that the distributorswere giving the said packs free of cost, as a promotional scheme; that Revenue hasotherwise not doubted the fact that the consideration received by the assessee fromthe distributor is not the consideration or something more has flown back; that in theabsence of any such allegation much less any evidence, the ratio of law declared bythe Supreme Court in Sun Pharmaceuticals Inds. Ltd. 2016-TIOL-10-SC-CX is fullyapplicable - Appeal allowed with consequential relief: CESTAT [para 5, 6]


Baba Strip And Tubes Ltd Vs Additional Director General (ADJN) (Dated:December 2, 2016)

CX - Request made by appellant seeking inspection of electronic devices was turneddown by adjudicating authority - appeal to CESTAT.

Held: Appellant has sought examination / comparison of data supplied which iscontained in ACER brand laptop and relied upon in the show cause notice in thepresence of computer expert - examination of laptop is vital for adjudication of thecase, therefore, the appellant is having a legal right for examination of laptop inquestion - adjudicating authority directed to allow the appellant to examine the ACERbrand laptop and all the records pertaining to that electronic devices - after providingthe details, adjudicating authority to pass appropriate order by following the principlesof natural justice - Appeal allowed in above terms: CESTAT [para 8, 9]


Caparo Engineering India Pvt Ltd Vs CCE & ST (Dated: October 6, 2016)

CX - Appellant availed Cenvat credit of Central Excise duty paid on paints used in job-work activity undertaken in terms of Notification No. 214/86-CE - Pursuant to an Auditobjection, appellant reversing credit taken on inputs used in such job work activityand issued invoices to this effect to M/s Eicher Motors Ltd., who refused to accept thesame stating that cenvat credit of inputs used in jowork activity undertaken isadmissible and hence there is no requirement to reverse the credit - appellant filingrefund claim but the same was rejected on the ground that the assessee hadknowingly paid the amount and it was not paid under protest - Commissioner(A)upholding the rejection of claim, hence appeal to CESTAT.

Held: There was no requirement on the part of the Appellant to reverse the cenvatcredit on paints used in such jobwork activity - Furthermore, the reversal of credit wasdone by the Appellant on the insistence of the audit and range communication and theaudit objection was validated by the Commissioner - In such circumstances, when theamount has been paid on the objection raised by the audit, it is deemed that thesame has been paid "Under Protest" and the refund claim filed by the Appellant is inorder - appellant has also submitted the certificate issued by the CharteredAccountant, certifying that the said amount is shown as recoverable from thedepartment in the accounts of the Appellant and the same has not been disputed bythe revenue - impugned order is set aside and appeal allowed with consequentialrelief: CESTAT [para 4, 5]


Tata Motors Ltd Vs CCE (Dated: December 19, 2016)

CX - Valuation - Section 4 of CEA, 1944 - Valuation Rules, 2000 - Clearance of scrapto own foundries for manufacture of casting which are later utilized by appellant -Revenue view is that value adopted is not in conformity with the trend of price atwhich scrap was being procured from market by the same foundries - differential dutydemand raised and confirmed - appeal to CESTAT.

Held: Resort to rule 11 of Central Excise (Valuation of Price of Excisable Goods) Rules,2000 for recovery of differential duty carries with it the responsibility of arriving at theassessable value by examination of each component that is included therein byRevenue - Even if the noticee failed to provide adequate rebuttal to the allegations inthe notice, by no stretch does the residuary rule of valuation stand on its own as itlacks any defining parameter - in view of the sketchy and airy disposal of the issue,Matter remanded: CESTAT [para 8 to 13]



KRCD India Pvt Ltd Vs CCE (Dated: December 1, 2016)

CX – Appellant claimed exemption in terms of Notfn. 67/1995-CE in respect of‘stampers' manufactured and consumed captively for manufacture of CDs - Revenuedenied exemption on the ground that the final product CDs are exempted frompayment of CE duty – appeal to CESTAT.

Held : It is seen that stampers (ch.85) are manufactured and used captively –stampers are not getting consumed in the CDs though it is used for manufacture ofCDs, therefore, ‘stampers' qualify as capital goods and are entitled for exemptionunder Notfn. 67/95-CE even if they are used in manufacture of exempted finalproducts – Impugned order is set aside and appeal is allowed: CESTAT [para 5, 6]


Swarn Enterprises Vs CCE (Dated: January 6, 2017)

Central Excise - SSI Exemption - Brand Name - Brand Names not owned byassessee but assigned to it - Not entitled to SSI Exemption: The assignmentdeeds give the appellant firm only the right to use the brand names on their products.The denial of SSI exemption under Notification No. 8/03-CE in respect of goodsaffixed with brand name is linked with the brand name being owned by some otherperson and, thus, for this purpose what is relevant is the ownership of the brandname. Admittedly, none of the brand names are registered in the name of theappellant. Therefore, the appellant firm is not eligible for SSI exemption in respect ofthe goods affixed with brand names which do not belong to them. - para 8

Central Excise - Short payment of duty not intentional - Extended period oflimitation not applicable : The short payment took place on account of the fact thatthe duty was to be paid on value determined under Section 4A i.e. MRP minusabatement, the same was paid on transaction value under Section 4. However, thisappears to be due to ignorance on the part of the appellant firm, as disinfectant wasan item notified under Section 4A during 2006-2007 also and during that period also,the appellant firm paid duty on transaction value under Section 4 while during thatperiod, and as is clear, duty payable on transaction value under Section 4 was morethan the duty payable on assessable value determined under Section 4A and as suchthe appellant had paid excess duty to the tune of Rs. 2,19,478/-. Therefore, the shortpayment of duty during 2007-2008 is not on account of any intention to evade theduty on the part of the appellant and hence, the demand for recovery of this duty

raised vide show cause notice dated 10/7/09 is time barred. - para 7

Central Excise - Penalty on recipient of non-duty paid goods : Penalty underRule 26 of the Central Excise Rules, 2002 has been correctly imposed as admittedlyhe received non-duty paid goods cleared by the appellant firm. - para 9


CCE Vs Dhariwal Industries Ltd (Dated: November 16, 2016)

CX - Valuation of compounds which are mixtures of perfumes, attars and chemicalsmixed according to a secret formula and used in production of pan masala and gutkha- respondent had declared a process loss of 2% and AV was computed on CostConstruction basis - case of Revenue is built upon disproportionate use of rawmaterial - based on report of AD(Cost), AV was reworked and duty liability ofRs.3,05,33,417/- was confirmed but the matter was remanded by Tribunal owing tovarious lacunae in the proceedings - in denovo proceeding it was held that compoundsare excisable and based on CAS-4 as detailed in letter F.No. 6/29/2002-CX.1 dated13.02.2003 it was held that AV approved by competent authority was higher than thatdetermined in accordance with CAS-4 leading to dropping of a substantial portion ofdemand and confirmation of only Rs.59,025/- - Revenue in appeal before CESTAT.

Held: There was a specific direction given by CESTAT in remand proceedings to re-determine the assessable value in accordance with CAS-4 and which the adjudicatingauthority has done - grievance of Revenue is, therefore, misdirected - An adjudicatingauthority, in de novo proceedings, cannot deviate from the directions issued by theappellate authority - Had Revenue any misgivings about the directions given by theTribunal, that grievance should have been agitated before the competent appellateCourt - That was not done and to attempt to get the impugned order set aside forcomplying with remand directions is not a proper or timely exercise of power of reviewunder CEA, 1944 - Contrary to all canons of judicial propriety, this Revenue appealseeks to review Tribunal's own earlier order - grounds of appeal have not raised anypoint of substance on the findings of the adjudicating authority in denovo proceedings.- For the above reasons, Revenue appeal is dismissed: CESTAT [para 6, 7, 8]


Goa Sponge Andpower Ltd Vs CCE (Dated: December 2, 2016)

CX - ST paid on GTA service received on reverse charge basis - CENVAT credit availedon the strength of TR-6 challan during January 2005 to 15/06/2005 - Credit denied onthe ground that no invoice was issued and TR-6 challan is not a specified document.

Held: Bombay High Court in the case of Essel Propack - 2015-TIOL-3014-HC-MUM-CX, in paragraph 10 has held that question of discarding TR-6 challan as CENVATabledocument cannot be accepted; that rule 9 of CCR is a procedural rule and creditcannot be denied, if otherwise, the appellant is entitled to - Order set aside andappeal allowed: CESTAT [para 4, 5]


Info Expert Computer System Vs CCE (Dated: November 16, 2016)

CX - Appellant is purchasing and selling Computer CPU, Monitor and Keyboards -

appellant supplied these goods at the site of the consumer and installed the same byconnect each other using a cord - Department's contention is that this activityamounts to 'manufacture' of a computer and accordingly CE duty demand wasconfirmed/upheld by lower authorities - appeal to CESTAT.

Held: Activity cannot be construed as 'manufacture' under section 2(f) of CEA, 1944as whole computer is already manufactured - no new product comes into existence byassembling of the three items of CPU, monitor and keyboard - orders are notsustainable - appeals are allowed: CESTAT [para 5]


Arihant Industrial Corpn Ltd Vs CCE (Dated: December 14, 2016)

CX - Play equipment viz. Climbers and Thriller installed in the park/playground forchildren are "Sports goods" classifiable under Heading 95.06 and entitled forexemption in terms of notfn. 6/2002-CE – Impugned order set aside and appealallowed: CESTAT [para 4]



Ultratech Cement Ltd Vs CCE & ST (Dated: November 9, 2016)

CX - CENVAT - Amendment carried out in Rule 2(a) by introducing Explanation II toRule 2(a) of Cenvat Credit Rules, 2004 w.e.f. 7.7.2009 to exclude cement, angles,channels, CTD, TMT bars and other items used for construction of factory sheds,building, or laying of foundation or making of structures for support of capital goodscannot be held to be retrospective - case against the appellant for denial of creditcannot be sustained - Appeal allowed: CESTAT [para 5, 6, 8]

CENVAT - Limitation - Period covered is from March, 2007 to July, 2009 and SCNissued on 29.11.2010 - issue involved in the present case is the subject matter of longdispute and also has been considered by the various High Courts and the Tribunal indifferent situations - issue involved is one of interpretation of the provisions of CCRand various other legal principles - Admittedly, certain contrary views have beentaken by the various judicial bodies - In such situation, invoking longer period ofdemand on the ground of fraud, suppression, willful misstatement, etc. is not tenable- Demand hit by limitation - Appeal allowed: CESTAT [para 7]


CCE VS Tata Motors Ltd (Dated: December 1, 2016)

CX - During scrutiny of their records, Revenue found that there was a discrepancybetween the physical stock of raw materials cleared compared to the stocks declaredin 3CA/3CD returns made during the statutory audit - SCNs were issued to theappellants seeking to recover the CENVAT credit availed on such shortages - demandwas confirmed by original authority but dropped by Commissioner(A) - Revenue inappeal.

Held: Identical issue has been decided by Tribunal in appellant's own case as reportedat 2016-TIOL-1027-CESTAT-MUM where it is held that demand cannot be sustained asthere is no allegation of any mischief in the shape of clandestine clearance of rawmaterials and that shortages were of miniscule amount ranging from 0.01% to 0.21%- following the same, appeal is allowed: CESTAT [para 6]


CCE Vs Partap Steel Rolling Mills Ltd (Dated: September 28, 2016)

Central Excise - Notification No 214/86 - Respondents received scrap of hand toolsand converted the same into billets and into rectangular parts which are exported byprincipal manufacturers - as duty was not paid on the job worked goods, benefit ofexemption denied to the respondent - Hence, the present appeal.

Held: As per Notification No. 214/86, the job worker is entitled to clear the goodswithout payment of duty, in case duty has been paid by the principal manufacturer -ground for denial was that the principal manufacturer has not paid duty - as principalmanufacturer has exported the goods under bond which means that duty is leviableon such goods but is not being paid for reasons of export, held that department hasnot understood the Notification No. 214/86 - Hence, the impugned order is upheld -(Para 5).


Mercedes Benz India Pvt Ltd Vs CCE (Dated: October 21, 2016)

CX - CENVATTED inputs were diverted by appellant to their spare parts division onpayment of duty which is equivalent to credit availed, in terms of rule 3(4) of CCR,2004 - Revenue contention is that the duty payable on removal of input should be onthe sale price of the spare parts - appeal to CESTAT.

Held: Since appellant is not engaged in the manufacture of parts and components, itis bought out parts and components which are cleared as such, therefore, Section 4on such removal shall not apply - The duty which is required to be paid is only equalto the cenvat credit availed and not more than that - impugned order is notsustainable, hence set aside - Appeal is allowed: CESTAT [para 4]


Akzo Nobel Coatings India Pvt Ltd Vs CCE & ST (Dated: August 26, 2016)

Central Excise - CENVAT Credit - Credit taken based on RBA series invoices onreturned/rejected goods by customers, which were received from distributors wasallowed wherever appellant was able to produce documents to prove their claim ofreturn of goods and was disallowed wherever they could not prove their claim.

Appellant availed credit on returned/rejected goods by customers from distributors,based on RBA series invoices, intermediate document generated upon receipt ofrejected/returned goods, after correlating them with original duty paying document,i.e., IBA invoice - Credit was disallowed since no original documents i.e.,original/duplicate invoices raised when goods were initially removed, showing dutypayment on such goods was produced by appellant - In remand proceedings, as perdirections of the Tribunal, Adjudicating authority verified the documents produced byappellant and allowed credit on a part of the claim while remaining credit wasdisallowed on the ground that appellant was not able to prove the return of the goods,since only Xerox copies of RBA and IBA invoices were produced but not originals andnot even customer's invoices were produced - It is pertinent to note that whereverappellant was able to produce documents correlating return of the goods, credit wasallowed - Wherever appellant has not been able to produce any document to provereturn of goods, credit was disallowed since based on RBA invoices, the fact of returnof goods could not be established - Moreover, extended period is rightly invocable

since appellant has suppressed the fact that credit was availed on RBA series invoices- Hence, impugned order is upheld - Appeal dismissed. [paras 3, 4, 6, 7]


Bajaj Electricals Ltd Vs CCE (Dated: December 14, 2016)

CX - ‘Dummy' fan displayed in depot is no different from the normal electric fan whichare sold by valuing u/s 4A of CEA, 1944 – in fact, such ‘dummy fans' are later sold inmarket in the normal course – no exemption available under SWAM Act from affixingretail sale price on such ‘dummy fans' – goods rightly valued u/s 4A – Revenue claimof valuation u/s 4 of CEA, 1944 is not tenable – appeal allowed: CESTAT [para 4]



Tally Solutions Pvt Ltd Vs CCE (Dated: August 4, 2016)

Central Excise - CENVAT Credit - Cenvat credit is admissible on service tax paid onimmovable property-office premises rent for sales office as the service is squarelycovered under the definition of 'input service'.

Credit was denied on rent paid for office premises used as sales office on the groundthat it was availed after the place of removal and so is not covered under thedefinition of 'input service' - From the perusal of the definition of 'input service' u/r.2(I) of CCR, 2004 and in view of appellant's submission that they are actually in thesales promotion activity such as conducting maintenance of software, providing aftersales service and also making efforts to sell the product and such sales promotion isspecifically covered in the inclusive part of the definition of 'input service', it is seenthat the impugned service is squarely covered under the definition of input serviceand so credit is admissible on the impugned service - Appeal allowed. [paras 2, 4, 5,6]


Apollo Tyres Ltd Vs CCE (Dated: August 30, 2016)

Central Excise - Mandatory Pre-deposit - Mandatory pre-deposit should be depositedfor all appeals filed before the Tribunal on or after 6.8.2014 under amended provisionsof Section 35F of CEA, even if the related proceedings were initiated prior to the date.Hence appellant is given a month time to make the mandatory pre-deposit.

Appellant contends that since SCN was issued prior to 6.8.2014, they need notdeposit mandatory pre-deposit under amended provisions of Section 35F of CEA,which were w.e.f 6.8.2014 and prays for waiver of pre-deposit and grant of stay onmerits - Precedents have clearly held that for all the appeals filed before Tribunal onor after 6.8.2014 mandatory pre-deposit should be made as per amended provisionsof Section 35F of CEA and Section 129E of Customs Act - Some precedents have evenheld that the amended provisions have retrospective effect - Even though Revenueprayed for dismissal of appeal for non-compliance, since the issue was subject matterbefore various High Courts, in the interest of justice, appellant is given a month timeto comply with the requirement of Section 35F. [paras 1, 3, 4]


Toyota Kirloskar Motors Pvt Ltd Vs CCE (Dated: August 26, 2016)

Central Excise - CENVAT Credit - (a) Interest is not liable to be paid on irregularlyavailed credit, if such credit is reversed prior to utilization.

(b) Cenvat credit is admissible on Commission & Brokerage charges paid for providingresidential accommodation to ex-pat employees as it has due nexus with assessee'sbusiness of manufacture.

(a) Appellant reversed the credit availed on damaged auto components - Revenuedemanded interest on such irregularly availed credit by relying on Apex Court'sdecision in ‘ Ind-Swift laboratories' case, which held that interest is payable even ifthe credit is reversed prior to utilization - It is seen that in ‘Bill Forge Ltd.' case,Karnataka High Court had analyzed the Apex Court's decision and held that interest isnot to be paid if the credit is reversed prior to utilization and the Full Bench of theTribunal also held the same - Since appellant had reversed the credit prior toutilization, immediately after being pointed out by Revenue, interest is not liable to bepaid. [paras 1, 3, 4, 5]

(b) Credit denied on Commission & Brokerage charges paid for providing residentialaccommodation to ex-pat employees on the ground that appellant is providing suchaccommodation voluntarily and it has no direct or indirect relation to theirmanufacturing business - Appellant submits that as per their agreement with overseasjoint venture partner, they are under obligation to provide accommodation to suchemployees hired from their partner and that employees would literally work in theirfactory premises in carrying out manufacturing of motor vehicles - It is seen thatimpugned service has due nexus with the business of manufacture even though maynot be directly related to the manufacturing activity and the definition of ‘inputservice' u/r. 2(I)(ii) of CCR has wider connotation to include any service used directlyor indirectly in or in relation to manufacture - Moreover, precedent has held thebrokerage/commission paid is a business activity and is eligible for input credit -Hence, impugned orders set aside - Appeal allowed. [paras 5.1, 5.2, 6]


CCE & ST Vs 3m India Ltd (Dated: August 17, 2016)

Central Excise - CENVAT Credit - Assessee at the first instance, was not liable to payservice tax since liability to pay service tax under reverse charge mechanism came into effect only from 18.4.2006 with the introduction of Section 66A and secondlyhaving paid it, is entitled to get the credit.

Respondent is manufacturer and is also registered under service tax provisions under'management consultancy services' - Credit availed on 'management consultancyservices' as it included payments for services availed prior to 10.9.2004, was deniedas wrongly availed since as per the Notification No. 23/2004-CE (NT) dt.10.9.2004any service tax paid by manufacturing unit can be availed as credit earlier to10.9.2004, only if the unit was also providing any taxable output service -Commissioner (A) set aside the demand by holding that assessee was not able to payservice tax under reverse charge mechanism until introduction of Section 66A ofFinance Act, 2004 - It is undisputed that service tax was paid for input services onreverse charge method (import of service) in March, April, November 2005 whileservice tax liability on this type of service came in to effect only from 18.4.2006 withthe introduction of Section 66A - So assessee was not liable to pay service tax onreverse charge basis prior to 18.6.2006 - Hence, at the first instance, assessee wasnot liable to pay service tax and secondly having paid it, assessee is entitled to getthe credit on the same and had rightly availed the credit - In appellant's own caseitself, Tribunal held that assessee is entitled to such credit - Moreover, Commissioner(A) rightly held that extended period is not invocable as there is no suppression offacts - Hence, Revenue's appeal dismissed. [paras 1, 2, 3]


Fiabila India Ltd Vs CCE (Dated: August 1, 2016)

CX - CENVAT - Appellant is a manufacturer of nail polish, fragrant nail enamel and nailenamel and had availed CENVAT credit of Rs.2,42,877/- being tax paid on‘Commercial and Industrial Construction service' rendered by M/s Jyoti Enterprises(Civil Engineers and Contractors) and CENVAT credit of Rs.3,14,356/- taken onstorage tanks supplied and erected by M/s Conveying Machines ManufacturingCompany - Revenue denied the credit on the ground that storage tank had not beeninstalled on the premises listed in the registration certificate but on an adjoiningpremises - credit denied, hence appeal to CESTAT. Held: Appellant submitted that oncompletion of work, that premises was incorporated as part of the existing factory -Matter is squarely covered by precedent decisions of Tribunal on identical grounds -for this reason, impugned order is set aside and appeal is allowed: CESTAT [para 4]


Autoline Vs CCE (Dated: November 4, 2016)

CX - Appellant in respect of certain inputs have shown the same as waste and in somecases lesser value was shown - CENVAT credit was denied to the appellant by citingrule 3(5B) of CCR, 2004 - appeal to CESTAT. Held: It is undisputed that the impugnedinputs remained in the factory and the same were not cleared - although the inputswere shown in the books of account as scrap and a lesser value was shown, it is notthe case where the value of the inputs was written off - Rule 3(5B) of CCR, 2004 hasno application at this stage and would come into play only when the inputs are clearedfrom the factory - appellant cannot be insisted to reverse credit, hence demand hasbeen wrongly confirmed - impugned order set aside and appeal allowed: CESTAT[para 4]


Bajaj Tempo Ltd Vs CCE & C (Dated: December 1, 2016)

CX - Rule 57A of CER, 1944 - MODVAT credit is admissible on tool kit supplied alongwith motor vehicle in view of Larger Bench decision in Bajaj Auto Ltd. and cited as -2002-TIOL-120-CESTAT-DEL-LB- Impugned order set aside and appeal allowed:CESTAT [para 4, 5]


India Steel Works Ltd Vs CCE (Dated: December 2, 2016)

CX - Shortage of stock ascertained during check carried out by officers - CE dutydemanded and confirmed with penalty - appeal to CESTAT. Held: Circular 52/79-CX.6dated 26.10.1979 referred to by appellant provides for tolerance of shortage in thenormal course of ascertainment during annual stock-taking - In the present case,there is an admission of stock shortage inasmuch as the shortage was not denied atthe time of check in the course of investigation - in view of the Madras High Courtdecision in Goyal Ispat - 2015-TIOL-749-HC-MAD-CX, no flaw can be found in theimpugned order - Appeal is, therefore, dismissed: CESTAT [para 4, 5]


Kirloskar Oil Engines Ltd Vs CCE (Dated: December 2, 2016)

CX - Appellant used to send Valve Steel & Steel Round bars for job work - It wasnoticed that after processing appellant received material short to the tune of 16% andwhich was claimed as processing loss - SCN issued alleging that 16% loss is abnormaland seeking demand of CE duty - as demand confirmed, appellant before CESTAT.Held: Revenue has not produced any evidence to show that there is diversion ofinputs or generation of physical waste and scrap which was cleared clandestinelyeither by appellant or job worker - demand on 16% process loss is on the basis ofassumptions and presumptions and, therefore, cannot sustain - appellant hasproduced Chartered Engineer Certificate wherein it is certified that process loss is16% to 27% - As Revenue has not produced any contrary evidence to discard claim ofappellant, demand cannot be confirmed - Order set aside and appeal allowed: CESTAT[para 4]


Lupin Ltd Vs CCE (Dated: November 16, 2016)

CX - CENVAT - Rule 7 of CCR, 2004 - Head office of appellant-company is registeredas 'input-service distributor' and is entitled to distribute the credit of services availedfor supporting the manufacture of output goods by the constituent units - Impugnedorder has objected to the distribution for failure to justify the proportion allocated tothe Tarapur unit - appeal to CESTAT. Held: There was no such allegation leveled inthe show cause notice and the adjudicating authority appears to have travelledbeyond the notice in holding that the credit is not admissible - moreover, distributionof credit prior to 01.04.2012 were not fettered - considering the ratio of the decisionsin Castrol India Ltd. - 2012-TIOL-2024-CESTAT-AHM, Doshion Ltd - 2013-TIOL-395-CESTAT-AHM , Praj Industries - 2014-TIOL-2016-CESTAT-MUM, the reasoningadopted by the adjudicating authority in denying the credit does not stand the test oflegality - Impugned orders set aside and appeals allowed: CESTAT [para 5 to 10]


Sun Steel Vs CCE (Dated: November 30, 2016)

CX - During visit of officers, 95MTs of MS scrap found short on physical verification offactory stock on 6th March 2010 - duty liability was made good by debiting PLA aswell as through CENVAT credit account - appellant submitting that the estimatedshortage had not been ascertained by scientific or verifiable manner but on 'eyeestimate' - as order of appropriation of duty liability and penalties imposed wasupheld by Commissioner(A), appeal filed before Tribunal. Held: As stock taking wasdone in the presence of Manager and the shortage was not disputed, in view ofdecision of Madras High Court in the case of Goyal Ispat - 2015-TIOL-749-HC-MAD-CX, appeals are devoid of merit and, therefore, dismissed: CESTAT [para 5]


T Abdul Wahid Tanneries Pvt Ltd Vs CCE (Dated: December19, 2016)

CX - If all the machineries that are required to set up a plant can get the benefit, nojustification to deny the benefit to the plant itself - Reverse Osmosis Plant received bythe appellant is clearly covered by the exemption notification 3/2004-CE and,therefore, it was not liable for any payment of duty - duty paid by supplier isrefundable subject to verification of issue of unjust enrichment: CESTAT [para 4]



India Tube Mills And Metal Industries Ltd Vs CCE (Dated: October 26, 2016)

CX - CENVAT - Whether appellant is entitled for credit in respect of service tax paid onbill of Mobile Phone (in the name of the employee/company), insurance premium ofmotor vehicle owned by company, insurance premium of accident policy of theemployees and insurance premium of guest house - lower authorities denied credit, soappeal to CESTAT. Held: Being a manufacturer, all the referred services of mobilephone and insurance premium is related to the factory and over all manufacturingactivity, therefore, admissible for cenvat credit - Impugned order set aside and appealallowed: CESTAT [para 4]


Gemini Instratech Pvt Ltd Vs CCE (Dated: December 6, 2016)

CX - Anchor rings, Load spreading plates and Wind-mill doors/Tower Doors are partsof Wind-Operated Electricity Generator ( WOEG) & entitled to benefit of exemptionNotification No. 6/2006-CE – Impugned orders set aside and appeals allowed: CESTAT[para 2.1, 2.2, 3]



LG Electronics India Pvt Ltd Vs CCE & ST (Dated: October 3, 2016)

CX - CENVAT - Since SCN did not bring forward any evidence to establish that therehas been collusion between the appellant and the service provider for evasion ofService Tax and for availing inadmissible CENVAT credit, invocation of extendedperiod is unsustainable - Penalties and interest also set aside - appeals allowed:CESTAT [para 5]



JRK Auto Parts Pvt Ltd Vs CC, CE & ST (Dated: September 23, 2016)

CX - During the Year 2007-08 and 2008-09, appellant took Cenvat credit ofRs.6,10,073/- on the basis of seven Bill of Entries – since assessee could not producethe original copies of said Bill of Entries to the Officers conducting Audit, demandnotice issued seeking to deny the credit – assessee submitted that the said copies ofBill of Entries were sent to statutory auditors who misplaced them – credit denied and,therefore, appeal to CESTAT. Held: It is an admitted fact that at the time of visit ofAudit Officers photo copies of Bill of Entries were produced and there are noallegations in the SCN that at the time of availment of Cenvat credit the appellants didnot have the original copies of Bills of Entry - there are also no allegations that theinputs were not received in the factory or that the inputs were not used in themanufacture or that the inputs did not suffer duty – credit admissible - appeal allowedwith consequential relief: CESTAT [para 5]


Mamta And Company Vs CCE (Dated: September 8, 2016)

Central Excise - manufacture of S.S. Patta /Patti, Circles and Waste Scrap - workingunder production based control system of self-removal procedure and were availingS.S.I. exemption benefit in terms of Notification No. 1/93 dt. 28.02.1993 – attracted15% advalorem rate, filed classification list under Rule 173B and claimed slabwiseconcessional rates of duty – during scrutiny, it was observed that appellants haddischarged the duty liability @15% in respect of waste scrap removed from thefactory and availed partial concession by discharging duty @5% and 10% underNotification No. 1/93 in respect of SS Patta /Patti and Circles – SCN issued and boththe demands were confirmed – On appeal, the same was upheld.

Held: The main issue to be decided is whether the appellants can exercise option inrespect of one item manufactured by them and pay full duty while availing theconcessional duty on the other item manufactured by them - reading ofthe Notification No. 1/93 shows that a manufacturer has the option of not availing thebenefit of the said exemption and to pay duty at the normal rate and duty has to bepaid on all their subsequent clearances at the normal rate - appellants haveattempted to create an artificial regime as if they are manufacturing two distinctproducts, one dutiable and other exempted, while is not the case – scrap has arisenas product of the manufacture of patta / patti – hence, subsequent clearance includesclearance of both - the department has not accepted the approval of classification list- Commissioner (Appeals) has rightly upheld the demand for the entire period on thebasis of the judgment of Hon'ble Supreme Court in the case of Asian Paints (I) Ltd.vs. Collector of C.Ex ., Bombay - 2002-TIOL-498-SC-CX – Limitation - it is seen thatboth the show cause notices were issued within time in terms of the relevant dateunder Section 11A of Central Excise Rules, 1944 – Hence, appeals dismissed – (Para 8& 9)


Prism Cement Ltd Vs CCE & ST (Dated: October 28, 2016)

Central Excise - manufacture of cement and clinker - dispute in the present appeal isrelating to eligibility of the appellant for Cenvat credit of service tax paid for GTAservices for outward movement of cement up to the premises of the buyers.

Held: the entire dispute revolves around the fact whether the "place of removal" is thefactory of the appellant or the customer's premises – the invoice issued at the time ofdispatch, indicated Free On Board instead of FOR - commercial invoices issued by theappellant show segregation of value of goods under transportation value for thepurpose of VAT, as the excise duty is discharged on MRP basis inclusive of all taxesand transportation - transport is arranged by the appellant and the charges are paidby them including service tax on reverse charge basis - appellants have submittedcategorical supporting evidences to the effect that "place of removal" is thecustomer's premises only - original Authority has not examined all the evidences -Place of removal is a question of fact to be examined with reference to the definition,as mentioned in Section 4 and with the scope as clarified in Board Circular No.97/8/2007-ST - wherever clearances are on ex-works basis they have not taken anycredit - Simply because the dealer's agreement covered all contingencies the samewill not lead to a conclusion that all clearances by the appellants to the customers areon ex-works basis – Hence, the matter is remanded for re-verification – (Para 2, & 4)


Crompton Greaves Ltd Vs CCE (Dated: December 1, 2016)

CX - During the period March, 2010 to December, 2010, appellant paid service tax ongoods transported to the buyers and availed the cenvat credit thereon – Credit denied

and equivalent penalty imposed with interest – appellant paid the CENVAT creditbefore adjudication and contests interest and penalty on the ground that the creditwas not utilized since they had sufficient credit in account and penalty is notimposable as they were in doubt regarding admissibility or otherwise of credit; in thealternative penalty that can be imposed is 25% only. Held: Cenvat Credit account waslying unutilized and therefore, interest is not payable by the appellant - From April,2010, there was an amendment in the Rules that the appellant was not entitled forcenvat credit on the outward agency service – however, in case the transportationcost is added in the assessable value, the assessee is entitled to avail Cenvat Crediton the outward goods transportation agency service - Admittedly, since appellant hasnot included the cost of transportation in the assessable value, appellant is notentitled to avail cenvat credit on the transportation charges – as appellant has paidthe amount of cenvat credit before adjudication, penalty imposable is @25% of dutyamount – Appeal disposed of: CESTAT [para 7 to 10]


Lloyd Electric And Engineering Ltd Vs CCE & ST (Dated: November 21, 2016)

CX - CENVAT - Excess availment of credit by assessee on the basis of the documentsrelated to their Himachal Pradesh unit, which were sent to them inadvertently by theirHead Office; double availment of credit in respect of one invoice; and in respect ofone Bill of Entry, the credit was availed before the receipt of the goods - appellantclarifying that the credits were availed by mistake and hence the total credit ofRs.21,75,684/- was debited by them on the day the Preventive officers visited factoryfor verification - in adjudication, amount debited was appropriated and equivalentpenalty is imposed - appellant before CESTAT against penalty. Held: Since the entirecredit has been reversed by assessee before issuance of SCN, the same should havebeen considered as finality of the proceedings and no show cause notice was requiredto be issued - in the matter of credit availed on the basis of documents related to HPunit, to err is human and inasmuch as the error is on the part of the employeeresponsible for making entries in RG-23 (a) part II, who had recently joined, therewas no malafide intention on the part of the assessee so as to warrant imposition ofpenalty upon them - in the context of premature availment of credit on basis of Bill ofentry, the same has not benefitted the assessee inasmuch as the credit availed wasnot put to use on account of already overflowing credit available with the assessee,therefore, no malafide can be attributed - no justifiable reasons to impose penalty onthe appellant - penalty set aside and appeal allowed to the said extent as there is nochallenge to the duty confirmation - appeal disposed of: CESTAT [para 8 to 10]


Funskool (India) Ltd Vs CCE & ST (Dated: December 15, 2016)

CX - Clause (vi) of Notf. 67/95-CE mandates that benefit of captive consumption @ Nilrate of duty is available if obligation prescribed in rule 6 of CCR is discharged – rule6(1) and rule 6(2) are alternative to each other - since appellant satisfies rule 6(1)inasmuch as they have not taken CENVAT credit on any inputs, finding of lowerauthority that rule 6(2) is not fulfilled is misleading and absolutely incorrect – Benefitof Nil duty for captive consumption is available in respect of packing boxesmanufactured for exempted toys, games and puzzles etc. – Appeals allowed: CESTAT[para 4]



KK Sales Vs CCE (Dated: October 28, 2016)

Central Excise - Manufacture of pan masala - Liable to Central Excise duty - Uponinvestigation, confiscation of Betel Nut was ordered on the ground that it is anexcisable commodity - non-accountal of excisable product attract the provision of Rule25 (1) of Central Excise Rules, 2002, along with redemption fine - On appeal, thesame was confirmed.

Held: Rule 25 of Central Excise Rules, 2002 is applicable only with reference toexcisable goods - these are agricultural produce in raw form and not manufacturedproduct - raw material for further manufacture and not supari - not an excisablegoods in the form in which it was seized - even if it is a violation of the NotificationNo. 3/2007-CE (NT) mandating the submission of statement of raw material includingBetel Nut, failure to do so can at best result in imposition of penalty - confiscation ofgoods ordered in terms of Rule 25 of Central Excise Rules, 2002 is not justified -Hence, the impugned order is set aside - (Para 4).



Shamraj Engineering Works Vs CCE (Dated: August 12, 2016)

CX - Section 2(f) of CEA, 1944 - Manufacture, Marketability - Appellant ismanufacturing parts of 'Micro Spray Water Cooling System' in their factory premisessituated in Pune and supplied the same to M/s. Sasa Musa Works Ltd. , Gopalganj -M/s. Sasa Musa Works Ltd . subsequently placed an order to complete theerection/commission of 'Micro Spray Water Cooling System' - Installation workinvolves that plastic pipes, nozzles, joints etc. are supplied from their Pune factorywhich with the help of labour supplied by M/s. Sasa Musa Works Ltd . were installedon concrete pillars and this is when 'Micro Spray Water Cooling System' comes intoexistence, the resultant structure being firmly fixed to the ground and cannot beconsidered as goods for the purpose of marketability - SCN issued for recovery of CEduty on 'Micro Spray Water Cooling System' and demand confirmed - appeal toCESTAT. Held: From the photographs of the assembled structure brought to the noticeof the bench and the method of construction, it is observed that after assembling ofthe pipes, nozzles, joints etc. the resultant product gets embedded/ attached to theconcrete structure and is not removable by simple activities of unbolting of nuts andbolts - Theoretical possibility of dismantling such structure embedded in concrete willresult into breaking of plastic pipes and parts - Accordingly, it is held that thestructure assembled by the appellant at site is immovable and cannot be consideredas marketable goods attracting central excise duty - Appeal allowed: CESTAT [para 6to 8]


CCE Vs Yathartha Yantra Udyog (Dated: October 18, 2016)

Central Excise – SSI Exemption – bolts cleared by the manufacturer had their initialson it – revenue treated these marks as trade name or brand name and was of theview that SSI exemption would not be eligible – SCN issued for denying theexemption along with interest and penalty – issue was dropped holding that the marksare not the brand names but are only marks for the purpose of identification of thegoods consigned to the customers – On appeal, the appeal was rejected – Hence, thepresent appeal by revenue.

Held: The revenue has not refuted the fact that the goods purchased from therespondent having identification mark but these identifications marks are not theirtrade name or brand name - in the case of Pethe Brakes Motors Ltd , it was held that"the word "PETHE" used on the metal labels is not a brand name or trade name butonly a house mark or family name. As it happens "PETHE" is a surname and anybody

having "PETHE" surname can use the same without any restriction - CBEC Circular52/52/94-CX, 1-9-1994 says that the brand name is not owned by any particularperson - The use thereof will not deprive a unit of the benefit of SSI” - In the case ofMalabar Oxygen Pvt.Ltd. it was held that affixing of Company's name cannot beconsidered as affixing a brand name or trade name – In the case of Deebha Foundry,the tribunal observed that the SSI exemption in terms of the notification is excluded ifthe SSI unit uses the brand name of another unit and are not entitled to the benefit –On analysis of the cases and facts, the respondent is not manufacturing the goodshaving brand name of others – Hence, entitled to avail the benefit of SSI exemptionnotification – Appeal filed by the revenue is dismissed – (Para 7, 8, 9, & 10).


Uniworth Textiles Ltd Vs CCE (Dated: November 4, 2016)

CX - Shortages of raw material – on shortages CE duty is demanded – appeal toCESTAT.

Held: As regards shortages, the same are in respect of yarn and polywool etc. whichare to the tune of small fractional percentage of the total stock - It stands held innumber of decisions that shortages in the raw material itself cannot lead to inevitableconclusion of clandestine removal of the final product, in the absence of any furtherevidence on record - impugned order confirming demand of duty cannot be upheld –Appeal allowed: CESTAT [para 5, 6]

CX - Excess stock found during stock taking confiscated with an option to redeem thesame on payment of Redemption fine (RF) of Rs.25 lakhs – appeal to CESTAT.

Held: As regards confiscation of excess found materials, it is seen that a case of shortfound material to the same extent was made against M/s. Uniworth Ltd. (Division ofappellant) and Tribunal has already accepted the stand of M/s. Uniworth Ltd. that thegoods found short in their premises were transferred to the present appellant'spremises on account of same being moth infected - excess found in the presentappellants case, therefore, cannot be held as liable to confiscation - order relating toconfiscation of the excess found goods and payment of RF is set aside – Appealallowed with consequential relief: CESTAT [para 4]


Kalindi Ispat Pvt Ltd Vs CCE (Dated: November 16, 2016)

CX - CENVAT - Appellant, manufacturer of sponge Iron, availed credit on Angles,channels, beams, plates, HR/CR sheets and coils, Joists for manufacture of kilns,Electro static precipitator, Kiln cooler transfer building, Hooper, Conveyor systems,supporting structures - credit denied by adjudicating authority - appeal to CESTAT.

Held: Apex court in the case of Rajasthan Spinning & Weaving Mills Ltd. - 2010-TIOL-51-SC-CX , has considered an identical issue of steel plates and MS channels used inthe erection of chimney for diesel generating set and extended the credit in thecontext of rule 57Q of CER - applying the 'User Test' envisaged in Jawahar Mills Ltd. =2002-TIOL-87-SC-CX to the facts in hand, Bench has no hesitation in holding that thestructural items used in the fabrication of support structures would fall within theambit of 'capital goods' as contemplated under Rule 2(a) of the CCR, hence will beentitled to the Cenvat credit - impugned order set aside and appeal allowed withconsequential relief: CESTAT [para 4, 5]


Sahney Kirkwood Pvt Ltd Vs CCE (Dated: December 1, 2016)

CX - Classification of Commutators, whether under heading 85.48 as claimed byappellant or under heading 85.03 as contended by Revenue - appeal to CESTAT.

Held : As per the definition appearing in McGraw Hill Professional Science andTechnology Encyclopedia, the function of commutators is directly related to providingcurrent to a motor or to draw electric current from a generator - In the process, thecommutator does not become part of electric appliances or locomotive - commutatorsremain a part of motor, which in turn is used as a component of other machine -therefore, the correct classification of commutators is 85.03 - cum-duty benefitsavailable to appellant - Appeal is partially allowed: CESTAT [para 3, 4]


Aparant Iron And Steel Pvt Ltd Vs CCE (Dated: December 2, 2016)

CX - CENVAT - Goods Transport Agency service - Credit taken of Service tax paid onreverse charge basis on the strength of TR-6 challan during January 2005 to15/06/2005 - Department denying credit for the sole reason that no invoice wasissued - appeal to CESTAT. Held: Issue has been decided by the Bombay High Courtin the case of Essel Propack - 2015-TIOL-3014-HC-MUM-CX and MRF Ltd. - 2015-TIOL-2234-HC-MAD-ST by holding that credit taken on the strength of TR-6 challancannot be denied; that rule 9 of CCR, 2004 lays down procedural aspect and cannotbe employed to deny the claim to avail credit - Appeal allowed: CESTAT [para 4, 5]


Pepsico India Holding Pvt Ltd Vs CCE (Dated: October 25, 2016)

CX - CENVAT - Credit taken on the strength of Xerox copy of invoices or invoiceswherein serial number of the invoices were either not printed or handwritten - creditdenied by lower authorities, therefore, appeal to CESTAT.

Held: There is no case of the Revenue that inputs covered under the said invoiceswere not received by the appellant and not used in the manufacture of final product -credit is allowed in respect of duty suffered on the inputs and if that it is not disputed,credit cannot be denied - Allegations made by Revenue is of procedural nature and forsuch procedural lapse, substantial benefit of CENVAT credit cannot be denied as theduty payment under invoice, receipt of input and use thereof has not been disputed -impugned order is not sustainable, hence set aside and appeal allowed: CESTAT [para5]


CCE Vs Vashisti Detergents Ltd (Dated: December 2, 2016)

CX - Valuation - Appellant supplied detergent powder in bulk to M/s. AK Enterpriseson stock transfer basis for packing of detergent powder in retail packs and, thereafter,M/s. AK Enterprises clears the detergent powder to the depot of Hindustan Lever Ltd.on payment of duty as per Section 4A of CEA, 1944 - However, Valuation of goodssold by the appellant to M/s AK Enterprises was done on the basis of comparablevalue i.e. Rs.25,486/- per MT at which the said goods were sold to Hindustan LeverLtd. - Department alleging that since the goods, i.e., detergent powder in bulk issupplied by the appellant to AK Enterprises on job work and not for sale, therefore,

valuation as per Section 4(1)(a) will not apply and that valuation should be arrived atin terms of Rule 8 of Valuation Rules, 2000 - Commissioner (A) setting aside o-in-o,therefore, Revenue in appeal before CESTAT. Held: In a case where the same goodsare sold by the assessee on principal to principal basis, then instead of adoptingvaluation envisaged in Rule 8, the sale price to the independent buyer will apply -appellants have correctly applied sale price at which goods were sold to HLL in thetransactions where the goods were supplied to the job worker, i.e . AK Enterprises -Impugned order upheld and Revenue appeal dismissed: CESTAT [para 5]


Hindustan Zinc Ltd Vs CCE (Dated: October 7, 2016)

Central Excise - CENVAT Credit - appellants are engaged in the manufacture of nonferrous metals like zinc, lead, cadmium, silver etc., using ore which is mined fromvarious captive mines - "Ore and concentrates" are dutiable products but wereexempted under Notification No. 4/2006-CE dated 01.03.2006; and appellants werereversing cenvat credit on inputs relatable to such ore cleared without payment ofduty - However, in respect of input services they have done such reversal of creditinput services relatable the exempted ore cleared only at the end of the financial year2010-11 - the department proceeded against the appellant on the ground that theyhave not followed the procedure prescribed under Rule 6 and accordingly they areliable to pay 5% of value of exempted goods in terms of provisions of Rule 6 (3) ofCenvat credit Rules, 2004 - Demands were adjudicated and agitated herein.

Held: The admitted facts are that the appellants were reversing credit on inputsattributable to the exempted final product on a monthly basis; however, for inputservices they have reversed the proportionate credit only in the month of March, 2011- the original authority confirmed the present demand only on the ground that theappellant did not file due intimation and did not follow the proper procedure ofreversal of proportionate credit and as such they are not entitled to the saidconcession of reversal of proportionate credit - Tribunal, in the case of TataTechnologies Limited held that the condition of filing the declaration is only directoryand not mandatory - In the present case, the impugned order clearly records that theappellant reversed the credit attributable to the exempted clearances, as such thesubstantial compliance with reference to Rule 6 has been recorded, and the demand isset aside - however, there is a delay in reversing the proportionate credit by theappellant, and the liability of interest for the delayed reversal of credit is confirmed.[Para 3, 4]


Hindustan Platinum Vs CCE (Dated: December 19, 2016)

CX - Rule 18 of CER, 2002 accords rebate of duties paid on goods that are exportedand do not distinguish between exempted goods and dutiable goods - rebate underthis rule is allowable as along as goods are excisable or duty has been paid onmaterials used in processing of such goods - lower authorities have erred in adoptingthe approach which is redolent of opportunism - It is the stated doctrine in taxadministration that domestic taxes are not exported with goods - appeals allowed:CESTAT [para 5 to 8]



Sadhashiv Structral Pvt Ltd Vs CCE (Dated: October 25, 2016)

Central Excise - CENVAT Credit - appellants procured goods from a first stage dealerwhose premises was locked and godown is non-existent on investigation - On thebasis of investigation and statements, the registration was cancelled retrospectively -further investigation revealed that the appellants procured goods from the dealer andavailed cenvat credit -Revenue viewed that the appellant received the invoices but notthe goods inasmuch as the dealer was non-existent - credit was denied and demandedin adjudication, alongwith interest and equal amount of penalty; now agitated herein.

Held: No investigation was conducted at the end of manufacturer/supplier or thetransporter to reveal the truth whether manufacturer/supplier has supplied the goodsin question to the dealer or the transporter has transported the goods to the premisesof the appellants which is vital evidence to reveal the truth - Further, the dealer wasregistered during the impugned period and all the ER-1 returns were filed, which wereaccepted by the department - in the absence of any corroborative evidence to showthat the appellants have not received the goods, it cannot be alleged that they havereceived the invoices and not the goods merely on the ground that there was nostorage facility specifically when the landlord made a statement that the godown waslet out to the dealer - Ratio of rulings in the Dhawan Steel Industries case and Jainirrigation case applicable; in the absence of investigation at the manufacturer /transporter end, demand unsustainable; impugned order set aside. [Para 6, 7].


Sk Bhatnagar Vs CCE (Dated: October 19, 2016)

CX - Penalty u/r 26 of CER, 2002 - During the period involved, S.K. Bhatnagar wasnot working with the Company namely Kashipur Sugar Mills Ltd. and, therefore, thecharges levied by the Revenue against the appellant, Shri S.K. Bhatnagar cannot besustained - Penalty set aside: CESTAT [para 3]

CX - Penalty u/r 26 of CER, 2002 on R.K.Agarwal - Findings of Uttarakhand High Courtin order dated 18.4.2015 in Writ Petitions Nos. 1127 and 1256 of 2010 is relevant -Appellant is not guilty of issuing any excise duty invoice without delivery of the goodsnor such invoice was used to take ineligible benefit under the Act or the Rules nor wasthe appellant found guilty in transporting, removing or depositing any excisablegoods, which were liable to be confiscated - Appellant had raised the legal claimpursuant to the Notification No. 50/2003 C.E. dated 10.6.2003, therefore, taking thelegal ground, which subsequently found not to be available to the unit would notpermit the invocation of Rule 26 of 2002 Rules - Penalty not sustainable: CESTAT[para 3.1]


Chenab Textile Vs CCE (Dated: September 20, 2016)

Central Excise – Valuation - appellant is engaged in the manufacture of manmadeyarn and cotton yarn, and was collecting the textile committee cess (TCC) from thecustomers for the clearances made for home consumption – Appellant was notshowing this amount of cess in the accounts since 2000 and not deposited the samewith the Textile Committee, Govt. of India on which the appellant has claimeddeductions in the assessable value - Revenue viewed that the cess collected by theappellant is to be included in the assessable value for levy of duty; confirmeddemands with interest and penalty which was upheld by Commissioner (Appeals), nowagitated herein.

Held: As per amendment dated 1.1.1995, the units located in the State of Jammu andKashmir were also liable to collect the textile committee cess, therefore, theobservation of the Commissioner (Appeals) is factually incorrect - the issue is no moreres-integra, settled against the department in the Shruti Synthetics case -

Accordingly, the textile committee cess collected by the appellant is not required to beincluded in the assessable value; the impugned order is set aside [Para 5]


Ve Commercial Vehicles Ltd Vs CCE (Dated: October 7, 2016)

Central Excise - CENVAT Credit - appellants, engaged in the manufacture of motorvehicle chassis, are clearing it to the job worker on payment of duty; who in turnmanufactures body on the chassis and clears the same on payment of duty asapplicable - The appellants were availing credit of tax paid on various input services -Revenue viewed the same inadmissible on the ground that these services are not usedin or in relation to the manufacture of final products - demand for recovery ofirregular credit with interest and penalties on the firm and individual adjudicated, andagitated herein.

Held: The eligibility to avail the credit on these input services has come up earlierbefore the Tribunal in the appellant's own case, and settled in their favour in FinalOrder No.52437/2016 dated 29.06.2016 - all the services for which credit has beenclaimed under Rule 2(l) of the Cenvat Credit Rules, 2004 already stand allowed invarious decisions; issues are no longer res-integra- credit of tax paid on (i)Advertisement Agency Services; (ii) Banking & Financial Services; (iii) BankingAuxiliary & Business Promotion Services; (iv) Commercial Training & CoachingServices and Training and development Services; (v) Canteen Services; (vi) CourierServices; (vii) Customs House Agent Service & Inward freight services; (viii)Consultancy Services; (ix) Commission Agent Services; (x) Event ManagementServices; (xi) Foreign Consultancy Services; (xii) Insurance Services; (xiii) MandeepKeeper Services; (xiv) Market Research Services; (xv) Real estate Services; (xvi)Repair & Maintenance; (xvii) Security Services; and (xviii) Telephone, Tours & TravelServices allowed in terms of various rulings cited.[Para 8]

The transaction value of the fully built motor vehicles were determined by theprincipal manufacturer and the duty liability has been discharged at the job worker'send on the said basis - Further, Business Support Service is with reference tomovement of chassis and with reference to fully built motor vehicles upto the depotform part of the transaction value; no reason to deny the credit on such input service- service tax on such services have been remitted by the appellant and the finalproduct's value are in terms of the Rule 10 A of the Valuation Rules - However, nocredits shall be eligible for the services rendered beyond the place of removal (depot)as these Business Support Services are basically for movement of excisable goods[Para 11]


Art-N-Glass India Pvt Ltd Vs CCE (Dated: November 9, 2016)

CX - Notfn. 8/2001-CE - SSI exemption - Clubbing of clearances of three unitsalleging that they are dummy creations - demand confirmed and penalties imposed -appeal to CESTAT.

Held: Order simply states that an amount of Rs.45,32,926/- is confirmed - Further, apenalty of equivalent amount was jointly imposed on the three units - The amount isnot quantified for individual unit for the offences committed by them - Such jointliability of duty and penalty as held by the Original Authority is not legally sustainable- serious legal infirmities observed in the impugned order and, therefore, the same isset aside and matter is remanded back to the Original Authority for a fresh decision -A clear finding is required to be recorded about the status of these three units, whichincludes their bonafide existence or otherwise - duty liability, if any, has to be

fastened against an identified unit/assessee - Similarly, penalties, if required, are tobe imposed on the identified persons/units for the contraventions, if any, found -Matter remanded: CESTAT [para 7, 8]


Gupta Metals Sheets Pvt Ltd Vs CCE (Dated: October 4, 2016)

Central Excise - MODVAT - the appellant availed credit on consumable includingfurnace oil - Revenue viewed that the appellant is not entitled to avail credit onfurnace oil used in the manufacture of dutiable goods as well as final exempted goodscleared by availing the Notification No.04/97 and Notification No.5/98, therefore, theappellant is required to reverse the credit taken on furnace oil - The adjudicatingauthority held inter alia that the appellant has contravened the provisions of CentralExcise Rules and availed Notification No. 134/94 dated 27.10.1994 and NotificationNo.04/97 dated 1.3.1997 by declaring that no credit of duty paid would be taken bythem under Rule 57A, 57B and 57Q i.e. consumable furnace oil; and confirmeddemands - In the first round of litigation, the matter was remanded on the groundthat the Commissioner has not considered the provisions of sub-rule (3) of Rule 57Cof the Rules inserted by Notification 35/96, dated 31-8-1996; with direction toconsider the same - The denovo order is agitated herein, in the second round oflitigation.

Held:Punjab and Haryana High Court in the case of Super Auto (I) Ltd., examinedidentical issue and held that the provisions of sub-rule (2) of Rule 57C and sub-rule(1) and (9) of Rule 57CC of the Rules do not apply to inputs intended to be used asfuel; that in the case before them, there is categorical finding that furnace oil is usedas 'fuel'; and that the credit is admissible -The MP High Court, in Flex ChemicalsLimited pronounced identical ruling - As the issue has already been settled in favour ofthe appellant, the furnace oil used as fuel by the appellant in the instant case formanufacture of dutiable as well as exempted final products, is admissible for credit -the appellant is not required to reverse credit availed on furnace oil which has beenused as fuel; no merit in the impugned order which is set aside. [Para 7-10]


Modern Insulators Ltd Vs CCE & ST (Dated: October 28, 2016)

Central Excise – CENVAT Credit - appellants are engaged in the manufacture ofelectrical insulators and were availing Cenvat credit of duty paid on inputs and clearedsome of the finished excisable goods to Mundra Ultra Mega Power Project withoutpayment of duty under Notification No. 46/2008 - CE dated 14/08/2008 - Since theyhave not maintained separate account of inputs used for manufacture of exemptedfinal products, Revenue viewed that an amount equal to 10% of value of suchexempted goods cleared merited recovery in terms of Rule 6 (3) (i) of Cenvat CreditRules, 2004 - The Original Authority confirmed a demand for recovery of theimpugned credit and imposed equal amount of penalty under Rule 15 (2) of CenvatCredit Rules, 2004 readwith Section 11AC of Central Excise Act, 1944; same upheldby Commissioner (Appeals), and agitated herein.

Held: During the period when the final products were cleared by the appellant, thereis no exclusion for Mega Power Projects in the application of Rule 6 (3) - the plea thatthe amendment carried out in sub-Rule (6) of Rule 6 vide Notification No. 6/2010-CEdated 27/02/2010, should be considered clarificatory and apply retrospectively, islegally unsustainable; no merit in the appeal on primary demand for recovery of credit- Admittedly the duty free clearances were entered in the ER-1 for the months indispute - the show cause notice clearly mentions that the appellants have applied tothe Jurisdictional Assistant Commissioner on 25/4/2009 itself for exemption, whogranted permission for clearance on 13/5/2009 - there is no basis to allege

suppression or mis-statement or intention to evade payment of duty; the notice itselfhas been issued within the normal period - no justification for imposition of penaltyequal to the confirmed amount; and the penalty is set aside [Para 5, 6]



Ultra Tech Cement Ltd Vs CCE (Dated: November 16, 2016)

CX - CENVAT - Appellant is engaged in manufacture of Ordinary Portland cement,Pozzolana cement and clinker - credit taken of duty paid on plates, structures joints,ducts, sheet chains etc. treating the same as capital goods under Rule 2(a) of the CCR- Credit denied on the ground that the items were used in the cement manufacturingmachineries which are ultimately fixed/embedded to the earth, and hence are notgoods, as it becomes an immovable property - appeal to CESTAT. Held: Applying the'user test' to the case in hand, it is apparent that the structural steel items have beenused for the fabrication of support structures for capital goods - argument of appellantthat the various capital goods, such as kiln, material handling conveyor system,furnace etc. cannot be suspended in mid air and need to be suitably supported tofacilitate smooth functioning of such machines is tenable - Accordingly, the goodsfabricated, using such structural items, will have to be considered as parts of therelevant machines - definition of capital goods includes, components, spares andaccessories of such capital goods - no hesitation in holding that the structural itemsused in the fabrication of support structures would fall within the ambit of 'capitalgoods' as contemplated under Rule 2(a) of CCR, hence will be entitled to the Cenvatcredit - Impugned order is set aside and appeal allowed: CESTAT [para 8, 9]


Quality Flavours Export Vs CCE (Dated: February 9, 2016)

CX – Allegation of clandestine manufacture and removal; duty demand thereon alongwith confiscation and imposition of penalties – appeal to CESTAT. Held : Goods werebeing transported under the cover of purchase bill with road permit (statutorydocument, pre authenticated by the Sales Tax Department) - Under suchcircumstances, the genuinity of the transaction is prima facie established as being oneof purchase/trade and prima facie no case of clandestine removal of goods is madeout and/or established by the Revenue – Appeals are allowed with consequentialrelief: CESTAT [para 8]


Samsung India Electronics Pvt Ltd Vs CCE & ST (Dated: November 1, 2016)

CX - CENVAT - In view of the precedent judgment in the case of Commissioner ofCentral Excise, Nashik Versus Mahindra & Mahindra Ltd. = 2012-TIOL-836-CESTAT-MUM wherein it was held that Service tax paid on the expenses incurred for providingwarranty service were entitled for input service credit, the impugned orders are setaside and the appeals are allowed - appellants shall be entitled for consequentialreliefs: CESTAT [para 6]


UK Paints Pvt Ltd Vs CCE & ST (Dated: June 21, 2016)

CX - Issue in this appeal is whether Cenvat credit can be denied to the appellant for

defect or change in address of the service provider in the invoice issued by them forservices provided to the appellant. Held: From a plain reading of the proviso to Rule9(2) of CCR, it is evident that discretion has been vested in the adjudicating authority,wherever, there were some defects in the document or invoice of input service, etc.,then the adjudicating authority, if satisfied, that the goods or services covered by thesaid documents have been received and accounted for in the books of account of thereceiver, he may allow the Cenvat credit - From the facts on record, it is not disputedas to the receipt of service by the appellant and payment of service tax by them -Commissioner (Appeals) has failed to consider the returns and the challans annexedand record the finding as to why the input services credit is still not allowable underthe proviso to Rule 9(2) of CCR, 2004 - appellant is entitled to Cenvat credit of Rs.94,239/- - Appeal allowed with consequential benefit; penalty retained byCommissioner (Appeals) is also set aside: CESTAT [para 5]


LG Electronics India Pvt Ltd Vs CCE (Dated: September 29, 2016)

CX - Refund - When the goods were cleared from factory to depot, there was no saleinvolved and there was no data available to arrive at transaction value - When thegoods were cleared from depot to independent buyers, the data to arrive attransaction value was, for the first time, became available to M/s L.G. to calculateduty due and, on that basis said refund arose - Therefore, the contention of theRevenue that Commissioner (Appeals) had erred in relying on Tribunal's findings inthe case of IPCA Laboratories Ltd. , is not on strong footing - it is settled Law that thedate of filing refund claim, whether complete or not, is the date to arrive at limitationperiod and it is undisputed that the refund claim was filed on 05.11.2003 - matterremanded to Original Authority to examine the records and arrive at the refundpayable for the period from 05.11.2002 to 31st July, 2003 claimed by assessee -assessee appeal partially allowed and Revenue appeal rejected: CESTAT [para 7]