2016 (11) TMI 1171 - AT - Central Excise

Tribunal grants appeal, remands case for evidence verification on CENVAT Credit for oxygen valves

The appeal was allowed by the Tribunal, remanding the matter to the Adjudicating authority for verification of evidence provided by the Appellants ... Demand - Oxygen gas which is supplied for industrial as well as medical purpose - whether the Appellant has availed CENVAT Credit on inputs viz. valves used in the oxygen cylinders cleared to industrial consumers and for medical purposes? - Held that: - It is not in dispute that oxygen cleared to industrial consumer is dutiable and for medical purposes is exempted from payment of duty. I find that even though a Chartered Engineer’s certificate has been enclosed with their reply to the Show Cause Notice claiming that the CENVAT Credit on valves used in cylinders carrying oxygen for medical purposes, but the same has not been considered by the authorities below. Therefore, it is prudent to remand the matter to the Adjudicating authority for verification of all evidences produced by the Appellant - appeal allowed by way of remand. Issues involved:1. Availment of CENVAT Credit on valves used in oxygen cylinders for industrial and medical purposes.Analysis:The appeal was filed against an order passed by the Commissioner (Appeals) regarding the availing of CENVAT Credit on valves used in oxygen cylinders supplied for industrial and medical purposes. The Appellants, engaged in manufacturing Oxygen gas, were alleged to have not maintained separate records of consumption of inputs, leading to a demand notice for recovery of duty on oxygen supplied for medical purposes. The demand was confirmed along with a penalty, which was upheld by the Commissioner (Appeals), prompting the present appeal.The Appellants contended that they never availed CENVAT Credit on valves used in cylinders for medical purposes, providing a Chartered Engineer's certificate as evidence. On the other hand, the Revenue's representative argued that despite multiple hearings, the Appellants failed to provide evidence supporting their claim. However, they did not object to remanding the matter for verification.The key issue was whether the Appellants had availed CENVAT Credit on valves used in oxygen cylinders for both industrial and medical purposes. While oxygen for industrial use is dutiable, it is exempted for medical purposes. The Appellants submitted a Chartered Engineer's certificate to support their claim, which was not considered by the authorities. The Tribunal decided to remand the matter to the Adjudicating authority for verification of all evidence provided by the Appellants, with the condition that the Appellants must actively participate in the proceedings without unnecessary delays. The appeal was allowed by way of remand to the Adjudicating authority, keeping all issues open for further examination.