TaxTMI 
TaxTMI 
TaxTMI 
2010 (6) TMI 202
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....ormed subsidiary company has to be treated as on sale or otherwise? Whether transfer of goods from subsidiary company to SAIL to be treated as on sale or otherwise? (3) Whether the provisions of Rule 6 (3)(b) of the Cenvat Credit Rules, 2002 are applicable or not? 3. As regards issue no. 3, it is undisputed fact that the same already sands answered by the decision of the Bombay High Court in the matter of Commissioner of Central Excise vs Nicolas Piramal (India) Ltd., reported in 2009 (244) ELT 321 (Bom.). 4. As regards first two issues are concerned, a preliminary point arises for consideration, as to whether in the background in which the issues are sought to be referred to a Larger Bench, such reference would at all be maintainable. 5. The order dated 16.06.2008 [2009 (536) E.L.T. 711(Tri.- Del.)] passed by the Division Bench while referring the issues to a Larger Bench reads thus : "Heard both sides on the stay petition. 2.1. The applicant SAIL, an integrated steel plant, manufactures various iron and steel products. The demand relates to two major issues. 2.2. The relevant facts relating to the first issue are as follows: a) The appellant manufactures various dutiable ....
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.... TIOL-614-CESTAT-MUM 4. Regarding the second issue, the learned advocate submits that the power plant is within the factory premises of the SAIL; it is only a captive power plant of SAIL though the ownership of the same was transferred to BESCL, a subsidiary of SAIL; the entire power generated by BESCL requires to be sold to SAIL except any surplus power which can be sold to others with the concurrence of the SAIL. The captive power plant maintained by BESCL is being treated as captive power plant for the purpose of levy of electricity duty. He relies on the decision in the case relating to their own plant at Rourkela reported in 2007 (219) ELT 960, wherein similar deed of sale and assignment of business in relation to sale of rotor was dealt with. It has been held in that case that it was not a case of sale as normally understood; what was involved was not sale and alienation of assets, but transfer of assignment; the sale was only to ensure that new entity had enough resources for the purpose of effectively financing its own finances. 5. The learned DR submits that Rule 6 of the Cenvat Rules provides two exclusive alternatives. The manufacturer is required to 'either' maintain ....
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....ch the power plant was excluded. The contention is that it is clear from the revised ground plan that the rotor in question used in the power plant is not used in the factory of the manufacturer. 8. The learned SDR has also placed reliance on the decision of this Tribunal in the case of CCE, Jaipur-I v. Shree Prithvi Rolling Mills (P) Ltd.[2003 (58) RLT 6 (Tri-Del)] and Majestic Auto Ltd. vs. CCE, Ghaziabad [2004 (173) ELT 145 (Tri- Del)]in support of his contention that capital goods which are taken out of the factory premises, though not on sale, to other parties, cannot continue to enjoy Modvat Credit benefit. 9. The learned Counsel would point out that the above contention is not sustainable at all in the light of the judgement of the Hon'ble Supreme Court in the case of Vikram Cement [2006 (197) ELT 145 SC] and the decision of this Tribunal in the case of Corromandel Fertilizers Ltd. vs. CCE 2007-TIOL-09-CESTAT-BANG. It is being pointed out that the Hon'ble Supreme Court and the Tribunal had held that the expression 'used in the factory cannot be interpreted so as to exclude capital goods deployed outside the factory premises for bringing raw materials into the factory premi....
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....e? Whether transfer of goods from subsidiary company to SAIL to be treated as on sale or otherwise? (3) whether the provisions of Rule 6 (3)(b) of the Cenvat Credit Rules, 2002 are applicable or not 8. Record may be placed before the President for constituting the Larger Bench . 9. Meanwhile, in view of the fact that first issue is before the Larger Bench in the case of M/s. Nicholas Piramal (India) Ltd. and in respect of second issue, the matter is prima facie decided in favour of the appellant in their own case, pre-deposit of duty and penalty as per order-in-original of the Commissioner of Central Excise is dispensed with and recovery stayed. 10. As the issues raised in this appeal are similar to the case of M/s. Nicholas Piramal India Ltd., which stands referred to the Larger Bench, both the cases should be listed together." 6. The contention sought to be raised is that, considering the fact that the issues are sought to be referred primarily on account of prima facie disagreement with the view taken in Haldia Petrochemicals Ltd. vs CCE, Haldia, reported in 2006 (197) ELT 97 and Sanghi Industries Ltd. vs CCE, Rajkot, reported in 2006 (206) ELT 575 = (2006-TIOL-891-CESTAT-D....
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....re no doubt limited. Its area of jurisdiction is clearly defined, but within the bounds of its jurisdiction, it has all the powers expressly and impliedly granted. The implied grant is, of course, limited by the express grant and, therefore, it can only be such powers as are truly incidental and ancillary for doing all such acts or employing all such means as are reasonably necessary to make the grant effective. As stated in Maxwell on Interpretation of Statutes, (eleventh edition) where an Act confers a jurisdiction, it impliedly also grants the power of doing all such acts, or employing such means, as are essentially necessary to its execution. 9. It is true that a Bench of two members must not lightly disregard the decision of another Bench of the same Tribunal on an identical question. This is particularly true when the earlier decision is rendered by a larger Bench. The rationale of this rule is the need for continuity, certainty and predictability in the administration of justice. Persons affected by decisions of Tribunals or Courts have a right to expect that those exercising judicial functions will follow the reason or ground of the judicial decision in the earlier cases o....
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....ision of the Apex Court in Paras Laminates case (supra), apparently, discloses that, the Tribunal like any other Court, is expected to have due regard to the decision already delivered by the Tribunal on an identical issue. The rationale behind the same being to have continuity, certainty and predictability in the administration of justice. It is essentially to strengthen the confidence reposed by the citizens in the justice delivery system prevalent in the country. This, however, does not mean that the Members of the Tribunal have no freedom to express doubt about the correctness of the earlier decision on the identical issue. However, the expression of doubt about the correctness of earlier decision has to be by following certain required procedure in that regard. The Apex Court in Paras Laminates case (supra) itself has laid down some of the guidelines in that regard while holding that : "It is, however, equally true that it is vital to the administration of justice that those exercising judicial power must have the necessary freedom to doubt the correctness of an earlier decision if and when subsequent proceedings bring to light what is perceived by them as an erroneous decisi....