PFA
No justification for imposition of penalty under Section 77 and 78 of the Finance Act, 1994 when penalty under Section 76 thereof was waived on the ground of reasonable cause Garodia Special Steels Ltd Vs. Commissioner of Central Excise, Raigad [2014-TIOL-2638-CESTAT-MUM] In the instant case, Garodia Special Steels Ltd. (the Appellant) paid Service tax under […]
The Central Board of Excise and Customs (the Board) vide Circular No.993/17/2014-CX dated January 5, 2015 has issued a clarification on the matter of mandatory pre-deposit of duty and penalty for filing an appeal as was specified in Circular No. 984/08/2014-CX dated September 16, 2014.
'Drawback' akin to 'Rebate', therefore pre-deposit mandatory for filing Appeal only at first stage
The Central Board of Excise and Customs (the Board) vide Circular No.993/17/2014-CX dated January 5, 2015 has issued a clarification on the matter of mandatory pre-deposit of duty and penalty for filing an appeal as was specified in Circular No. 984/08/2014-CX dated September 16, 2014.
The Board has received several representations stating that some Commissioners (Appeals) have been insisting on pre-deposit in cases of demand of erroneous drawback granted. In this regard, the Board has clarified that Drawback, like rebate in the Central Excise, is refund of duty suffered on the export goods. Section 129E of the Customs Act, 1962 (the Customs Act) stipulates that the Appellant filing an appeal before the Commissioner (Appeals) shall pay 7.5% of the duty demanded where duty and penalty are in dispute. Accordingly, it is clarified that mandatory pre-deposit would be payable in cases of demand of drawback as the new Section 129E of the Customs Act would apply to such cases.
The Board has further clarified that mandatory pre-deposit under Section 129E of the Customs Act in the legislation does not extend to an appeal under Section 129DD of the Customs Act before Joint Secretary (Revision Application) [JS (RA)].
Therefore, effective from August 6, 2014, mandatory pre-deposit would be required to be paid in cases of drawback, rebate and baggage at the first stage appeal before the Commissioner (Appeals). However, no pre-deposit would be payable in such cases while filing an appeal before the JS (RA).
Where two Exemption Notifications, one granting absolute unconditional exemption and other granting unconditional partial exemption, is available to the Assessee, the Assessee has an option to opt the Exemption Notification which is more beneficial to him.
Assessee can choose most beneficial Exemption Notification where two or more Exemption Notifications are available
Bharat Vijay Mills Vs. Commissioner of Central Excise, Ahmedabad-III [(2014) 51 taxmann.com 266 (Ahmedabad – CESTAT)]
Bharat Vijay Mills (the Appellant) was engaged in manufacturing of cotton fabric which was cleared to the domestic market as well as for export after the payment of Central Excise Duty. Such export of cotton fabric was made under claim of rebate of duty at the rate of 4% in terms of the Notification No. 59/2008-CE dated December 7, 2008 (the Notification 59/08). The Appellant had also availed Cenvat credit in respect of the Inputs, Capital goods and Input services used in the manufacture of the finished goods during the period from December 07, 2008 to July 06, 2009.
There was simultaneously full exemption i.e. Nil rate of duty available under another Notification No. 58/08-CE dated December 07, 2008 (the Notification 58/08) for the same period. Both the Notifications i.e. Notification No. 58/08 and Notification No. 59/08 were issued under Section 5A(1) of the Central Excise Act, 1944 (the Excise Act).
The Department contended that the Appellant was required to reverse the Cenvat credit involved on the Inputs lying in their stock or in process of the finished goods or contained in finished goods lying in stock as on December 7, 2008, as the Appellant was not eligible for such Cenvat credit in accordance with the provisions of the Notifications No. 58/08.
The Department relied upon Section 5A(1A) of the Excise Act, which provides that where an absolute exemption is available under sub-section (1) of Section 5A of the Excise Act in respect of any excisable goods from the whole of the duty of Excise leviable thereon, the manufacturer of such excisable goods shall not pay the duty of Excise on such goods.
Further, as per Rule 6(1) and Rule 6(4) of the Cenvat Credit Rules, 2004 (the Credit Rules), the Cenvat credit shall not be allowed on such quantity of Inputs, Input services used in the manufacturing of exempted goods and Capital goods used exclusively in manufacturing of exempted goods.
Accordingly, Show Cause Notice was issued to the Appellant which was duly confirmed by the Adjudicating Authority. Being aggrieved, the Appellant filed an appeal before the Hon'ble CESTAT, Ahmedabad.
The Hon'ble CESTAT, Ahmedabad relied upon its own decision in the case of Arvind Ltd. Vs. CCE [(2014) 47 taxmann.com 91/46 GST 566 (Ahd. – CESTAT)] and held that where two Exemption Notifications, one granting absolute unconditional exemption and other granting unconditional partial exemption, is available to the Assessee, the Assessee has an option to opt the Exemption Notification which is more beneficial to him. Accordingly, Section 5A(1A) of the Excise Act is inapplicable in such a case and the Cenvat credit availed by the Appellant is valid.
Job worker is eligible to avail Cenvat credit of differential duty paid under cover of supplementary invoice issued by principal manufacturer after finalization of provisional assessment Jagatjit Industries Ltd. Vs. Commissioner of Central Excise, Chandigarh [2015-TIOL-28-CESTAT-DEL] Jagatjit Industries Ltd. (the Appellant) was the job worker of Glaxo Smith Kline Consumer Health Care Ltd (Glaxo) and […]
Job worker eligible to avail Cenvat credit of differential duty paid under cover of supplementary invoice
Job worker is eligible to avail Cenvat credit of differential duty paid under cover of supplementary invoice issued by principal manufacturer after finalization of provisional assessment
Jagatjit Industries Ltd. Vs. Commissioner of Central Excise, Chandigarh [2015-TIOL-28-CESTAT-DEL]
Jagatjit Industries Ltd. (the Appellant) was the job worker of Glaxo Smith Kline Consumer Health Care Ltd (Glaxo) and availed Cenvat credit of duty paid by Glaxo, the Principal manufacturer. The Appellant was clearing their final product manufactured on job work basis on payment of duty by utilizing Cenvat credit availed by them.
The assessments at the end of principal manufacturer were provisional and the same were subsequently finalized by a Final Assessment Order dated August 27, 2002, resulting in short payment of duty to the extent of Rs. 28,78,517/-. Accordingly, supplementary invoice for the said short payment was raised to the Appellant vide Invoice No. 4218 dated February 10, 2003. The Appellant availed Cenvat credit of the same. The Department disputed the availment of Cenvat credit on supplementary invoices by relying upon provisions of Rule 7(1)(b) of erstwhile Cenvat Credit Rules, 2002 (the erstwhile Credit Rules) [At present, Rule 9(1)(b) of the Cenvat Credit Rules, 2004] and further alleged that the duty paid under the cover of supplementary invoice cannot be co-related to the original invoices.
Both the Lower Authorities denied Cenvat credit availed on supplementary invoices and confirmed the demand of recovery of Cenvat credit wrongly availed along with interest and penalty. Being aggrieved, the Appellant filed an appeal before the Hon'ble CESTAT, Delhi.
The Hon'ble CESTAT, Delhi relied upon the judgment in the case of Hyundai Motors India Ltd. Vs. CCE [2008 (222) ELT 471 (Tri-Chennai)], and held that the provisions of Rule 7(1)(b) of erstwhile Credit Rules is not proper inasmuch as the said Rule debars availing Cenvat credit on the basis on supplementary invoices only where such additional duty became recoverable from the manufacturers on account of non-levy or short levy by reasons of fraud, collusion, or any willful misstatement or suppression of facts or contravention of any provisions with intent to evade payment of duty. In the instant case, since the Appellant took Cenvat credit of differential duty paid under the cover of supplementary invoice by principal manufacturer after finalization of provisional assessment, it is not a case of any suppressed production or malafide intent so as to invoke Rule 7(1)(b) of the erstwhile Credit Rules.
Hence, the Hon'ble Tribunal allowed Cenvat credit on supplementary invoice to the Appellant
The Hon'ble CESTAT, Mumbai relied upon the judgment of the Hon'ble High Court in the case of Nelco Ltd. [(2002) 144 E.L.T. 56 (Bom.)] which was further affirmed by the Hon'ble Apex Court in [(2002) 144 E.L.T. A104 (S.C.)], holding that in case of remand matter, the Department was not entitled to hold on to the amount deposited by the Assessee during the course of investigation as pre-deposit.
In remand matters, Dept not entitled to hold deposit made by Assessee during investigation as pre-deposit
In remand matters, Dept not entitled to hold on amount deposited by Assessee during the course of investigation as pre-deposit
Supreme Inds. Ltd. Vs. Commissioner of Central Excise, Nashik [(2015) 1 TMI 122 – CESTAT Mumbai]
In the instant case, investigation was conducted in the factory of Supreme Inds Ltd. (the Appellant) and some discrepancies were found with the physical stock and stock shown in Form 3CD declared under the Income Tax Act, 1961. The Appellant made a deposit of Rs. 20 lakhs during the course of investigation. Thereafter, Show Cause Notice was issued to the Appellant for demanding duty on the basis of investigation made. The Adjudicating Authority confirmed the duty demand of Rs. 10,47,000/- and also imposed a penalty of Rs. 1,91,000/-.
On appeal being filed before the Hon'ble CESTAT, Mumbai, the Hon'ble Tribunal remanded the matter back to the Adjudicating Authority for de novo adjudication. Thereafter, the Appellant filed a refund claim on September 22, 2005 for the amount deposited by them during the course of investigation.
Both the Lower Authorities rejected the refund claim on the ground that since the adjudication is yet to take place, the amount deposited by the Appellant is not required to be refunded. Hence, the refund claim filed by the Appellant is premature. Being aggrieved the Appellant preferred an appeal before the Hon'ble CESTAT, Mumbai.
The Hon'ble CESTAT, Mumbai relied upon the judgment of the Hon'ble High Court in the case of Nelco Ltd. [(2002) 144 E.L.T. 56 (Bom.)] which was further affirmed by the Hon'ble Apex Court in [(2002) 144 E.L.T. A104 (S.C.)], holding that in case of remand matter, the Department was not entitled to hold on to the amount deposited by the Assessee during the course of investigation as pre-deposit.
Accordingly the Hon'ble Tribunal held that the refund claim filed by the Appellant is not premature and the Department is required to refund the amount deposited by the Appellant during the course of investigation.
The Central Government vide Notification No. 01/2015-Customs (ADD) dated January 5, 2015 has continued the imposition of Anti-Dumping Duty on import of Synchronous Digital Hierarchy transmission equipment originated in or exported, from People's Republic of China and Israel, falling under Sub-Heading 8517 62 or 8517 70 of the First Schedule to the Customs Tariff Act, […
Imposition of Anti-Dumping Duty on import of Synchronous Digital Hierarchy transmission equipment
The Central Government vide Notification No. 01/2015-Customs (ADD) dated January 5, 2015 has continued the imposition of Anti-Dumping Duty on import of Synchronous Digital Hierarchy transmission equipment originated in or exported, from People's Republic of China and Israel, falling under Sub-Heading 8517 62 or 8517 70 of the First Schedule to the Customs Tariff Act, 1975.
The Anti-Dumping Duty imposed under said Notification shall remain in force up to and inclusive of December 7, 2015.
Seeks to extend the validity of notification No. 125/2010-Customs dated 16.12.2010 for a further period of one year i.e, upto and inclusive of 07.12.2015
Notification
No. 01 /2015-Customs (ADD)
Dated- 5th January, 2015
G.S.R. (E). -Whereas, the designated authority vide notification No. 15/20/2014-DGAD, dated the 6th December, 2014, published in the Gazette of India, Extraordinary, Part I, Section 1, dated the 6th December, 2014, has initiated review, in terms of sub-section (5) of section 9A of the Customs Tariff Act, 1975 (51 of 1975) (hereinafter referred to as the Customs Tariff Act), and in pursuance of rule 23 of the Customs Tariff (Identification, Assessment and Collection of Anti-dumping Duty on Dumped Articles and for Determination of Injury) Rules, 1995 (hereinafter referred to as the said rules), in the matter of continuation of anti-dumping duty on all kinds of Synchronous Digital Hierarchy Transmission Equipment (hereinafter referred to as the subject goods), falling under sub-heading 8517 62 or 8517 70 of the First Schedule to the Customs Tariff Act, originating in or exported from China PR and Israel, imposed vide notification of the Government of India in the Ministry of Finance (Department of Revenue), No. 125/2010- Customs, dated the 16th December, 2010, published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i) vide number G.S.R.981(E), dated the 16th December, 2010, and has requested for extension of anti-dumping duty for a further period of one year, in terms of sub-section (5) of section 9A of the Customs Tariff Act, pending the completion of the review.
Now, therefore, in exercise of the powers conferred by sub-sections (1) and (5) of section 9A of the Customs Tariff Act and in pursuance of rule 23 of the said rules, the Central Government hereby makes the following amendments in the notification of the Government of India in the Ministry of Finance (Department of Revenue), No. 125/2010- Customs, dated the 16th December, 2010, published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i) vide number G.S.R.981(E), dated the 16th December, 2010, namely: –
In the said notification, after the paragraph 2 and before the Explanation, the following paragraph shall be inserted, namely:-
"3. Notwithstanding anything contained in paragraph 2, this notification shall remain in force upto and inclusive of the 7th day of December, 2015.".
[F.No. 354/204/2009-TRU (Pt-I)]
(Pramod Kumar)
Under Secretary to the Government of India
Note: The principal notification was published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i), dated the 16th December, 2010 vide number G.S.R. 981(E), dated the 16th December, 2010.
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