Tribunal grants CENVAT credit for Clean Energy Cess on coal, citing statutory provisions and precedents.

The Ramco Cements Limited Versus C.C.,C.E. & S.T. - Commissioner of Central Tax, Bangalore North West Commissionerate

The Ramco Cements Limited Versus C.C.,C.E. & S.T. - Commissioner of Central Tax, Bangalore North West Commissionerate - 2018 (362) E.L.T. 841 (Tri. - ... Issues:
Admissibility of CENVAT credit for Clean Energy Cess paid on imported/indigenous coal.

Analysis:
The appeals were against an order confirming the denial of CENVAT credit on Clean Energy Cess paid on coal by the appellant. The Commissioner(Appeals) upheld the denial, leading to the present appeals. The appellant contended that Clean Energy Cess is akin to excise duty, entitling them to CENVAT credit. They cited legal provisions and judicial precedents, including the case of Sri Renuka Sugars Ltd., where the High Court held that CENVAT credit was allowable for Sugar Cess. The appellant argued that the Clean Energy Cess was levied as excise duty, making them eligible for credit. They also challenged the penalty imposed under Rule 15(1) of CCR, supported by relevant case laws.

The respondent defended the impugned order, asserting that the appellant was not entitled to CENVAT credit as the Cess was not paid as excise duty. They argued that the Commissioner(Appeals) thoroughly considered all aspects and legal provisions, concluding against the appellant's claim. The respondent contended that the decision in Sri Renuka Sugars Ltd. was distinguishable from the present case.

Upon review, the Tribunal analyzed the statutory provisions and legal framework concerning Clean Energy Cess. They noted that the Cess was levied as excise duty under the Finance Act, 2010, with references to the Central Excise Act, 1944. Drawing parallels with the case of Sri Renuka Sugars Ltd., the Tribunal found that the Clean Energy Cess was akin to the Sugar Cess, allowing for CENVAT credit. Relying on the High Court's decision, the Tribunal held that the denial of CENVAT credit on Clean Energy Cess was unsustainable in law. Consequently, the impugned order was set aside, and the appeals of the appellant were allowed with appropriate reliefs.

In conclusion, the Tribunal's detailed analysis emphasized the applicability of CENVAT credit for Clean Energy Cess, aligning with legal provisions and judicial precedents. The decision highlighted the similarities between Clean Energy Cess and Sugar Cess, establishing the appellant's entitlement to credit. The judgment provided a thorough examination of the legal intricacies, ultimately ruling in favor of the appellant and overturning the denial of CENVAT credit.