2014 (8) TMI 849 - AT - Central Excise

Denial of Cenvat Credit: Cement Manufacturing Case Remanded for Fresh Decision

COMMISSIONER OF CENTRAL EXCISE, TRICHY Versus M/s CHETTINAD CEMENT CORPORATION LTD

The case involved the denial of Cenvat credit on inputs used in mines outside the factory premises. The Commissioner (Appeals) ruled in favor of the ... Denial of CENVAT Credit - credit on inputs namely explosives, ammonium nitrate and detonators etc., used in the mines outside the factory premises - Held that:- mines are situated 40 kms away from the factory. He relied upon the decision of the Honble Supreme Court in the case of CCE, Jaipur Vs. J.K. Udaipur Udyog Ltd. [2004 (9) TMI 101 - SUPREME COURT OF INDIA] and the decision of the Tribunal in the case of Mangalam Cement Ltd. Vs. CCE, Jaipur [2003 (8) TMI 140 - CESTAT, NEW DELHI]. The Ld. Counsel appearing on behalf of the respondents submits that in their own case, the Tribunal following the decision of the Honble Supreme Court in the case of Vikram Cement Ltd. Vs. CCE, Indore -[2006 (1) TMI 130 - SUPREME COURT OF INDIA], remanded the matter by Final Order No. 40064/2013 dated 20.02.14. We find the period of dispute is related to November, 1998 to December, 2001. We also notice that the Honble Supreme Court in the applicants own case, Madras Cements Vs. CCE, Chennai [2010 (7) TMI 179 - SUPREME COURT], remanded this matter on the identical issue to verify as to whether it is captive mines - Decided in favour of Revenue. Issues Involved:- Denial of Cenvat credit on inputs used outside factory premises- Distance of mines from the factory premises- Applicability of previous judicial decisionsAnalysis:The case involved the denial of Cenvat credit on inputs, including explosives, ammonium nitrate, and detonators used in mines outside the factory premises. The adjudicating authority had rejected the credit, but the Commissioner (Appeals) ruled in favor of the respondents, who were engaged in cement manufacturing. The Revenue, in their appeal, argued that the mines were located 40 kilometers away from the factory. They cited the Supreme Court's decision in a previous case and a Tribunal decision to support their stance. On the other hand, the respondents' counsel referred to a Tribunal decision in their favor based on a Supreme Court ruling in another case. The period of dispute was from November 1998 to December 2001, and the Supreme Court had previously remanded a similar matter involving the same parties to verify if the mines were captive.Respecting the Supreme Court's decision in the applicants' own case, the Tribunal remanded the matter to the adjudicating authority for a fresh decision in line with the Vikram Cement Ltd. case and the previous Tribunal decision. The appeals were allowed by way of remand, indicating a need for further examination based on the legal precedents and specific circumstances of the case.