RULE 8(3)A OF CENTRAL EXCISE RULE DEMAND

[Pushkar Gupta]

Dear Sir

Our Client has received a demand order from AC of Central Excise under Rule 8(3)A of central excise Rule 2002, under two different order of ₹ 4,60,257 and ₹ 368678/- on account of dis-allowance of cenvat credit after 30 days in pursuance of show cause notice. we have quoted case law MEENAKSHI ASSOCIATES Versus COMMISSIONER OF CENTRAL EXCISE, NOIDA - 2012 (6) TMI 275 - CESTAT, NEW DELHI AND BABA VISWAKARMA ENGG. CO. (P) LTD. Versus COMMR. OF C. EX., GHAZIABAD - 2012 (9) TMI 814 - CESTAT, NEW DELHIfor relief in reply of show cause notice. Assistant commissioner has not consider it and had not provided other opportunity of being heard and sent demand order. It is requested that advise on following points.

1. What is remedy for above demand order, and whether it is beneficial to go for a appeal since in current scenario, disallowance of cenvat credit after 30 days is not applicable.
2. It has been deposited of ₹ 460257 after cause notice and subsequently it has been used against duty liability for any other months. whether it is required to deposit again or any relief is available.
3. Please suggest

thanks in advance.

Pushkar Gupta

[KASTURI SETHI]

Sh.Pushkar Gupta Ji,

Will you elaborate your issue ?

K.L.SETHI

[Pushkar Gupta]

Dear Sir

Our client has paid short duty around of ₹ 13000 for the month of April 2013 which has been reveled in month of November 2014 after scrunity of ER 1 by juridictional superintendent and disallowed Cenvat credit from June 2013 Under Rule 8(3)A of Central excise Rule, issue two show cause notices one is for the period June 2013 to November 2013 of ₹ 460257 and another for the period December 2013_to March 2014 of ₹ 368678 for disallowance of Cenvat credit of said period. Client was deposited Of ₹ 460257 as well short duty amount with interest against First show cause and not deposited interest on Cenvat credit disallowed. After some period excise deptt also ask for deposit of amount against second show cause notice and Issued another show cause notice for disallowance of Cenvat credit from April 2014 till 13 July 2014.

After some period hearing notice was received from Assistant Commissioner of Central excise for above show cause notices. In between client has used amount deposited Of ₹ 460257 for duty liability of subsequent month.

We have replied to pray to relief for above demand and quoted case as mentioned in first query. Deptt has not accepted any plea and confirm above demand.

It is requested that please give us advise that it is beneficial to go for Appeal against demand order from Deptt or any other solution is available.

Thanks

Pushkar Gupta

[KASTURI SETHI]

Dear Sh.Pushkar Gupta Ji,

You must fight the cases. File appeal with the Commissioner (Appeals). I am of the view that you would get justice in CESTAT. No chance of relief regarding penalty imposed.

[Ganeshan Kalyani]

Sir, I have not understood the reason why the department has rejected the CENVAT Credit. Whether it was availed wrong or what is the reason?

The suggestion given by Sri Kasturi Sir is sent percent correct. One should not leave any scope to win, if one is right in his action. Thanks.

[KASTURI SETHI]

Sh.Ganeshan Kalyani ji,

Virtually nothing can be said without seeing the SCNs. Sometimes an important clause may be missed while posting query. Why cenvat has been disallowed ? This can be ascertained only by going through SCN and Adjudication Order. There may be some other reason also. Prima facie, this case is fit for filing appeal.

Sometimes SCN is issued in a hurry and Order is also passed in the interest of revenue ,brushing aside the law. The assessee is always at receiving end and he is left with no option but to file appeal.When any Order-in-Original is passed, only filing appeal is the solution.

AI Summary

Cenvat credit disallowance - appeal with Commissioner (Appeals) recommended to contest Rule 8(3A) demands and related interest. Demand notices under Rule 8(3A) of the Central Excise Rules were issued for alleged post 30 day Cenvat credit avails; one demand was deposited and later set off against subsequent duties while interest on disallowed credit was not paid. The appropriate procedural remedy is to file an appeal with the Commissioner (Appeals) after reviewing the show cause notices and adjudication orders, noting limited prospects for penalty relief and the need to address the consequences of utilizing the deposited sum.