TaxTMI 
TaxTMI 
2010 (3) TMI 621
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....03-C.E. (N.T.), dated 1-3-2003. This Appeal No. E/92/05 assails the order of the Commissioner confirming demand of duty paid on tyres using credit under AED (GSI) . After filing the appeal, M/s. Balakrishna Industries Ltd. paid the duty along with interest as per the order impugned. Revenue seeks to deny the credit allowed by the Commissioner to CEAT; M/s. Balakrishna Industries Ltd. seeks relief against demand of duty discharged using AED (GST) in similar circumstances. The issues involved in both the appeals are essentially the same. Appeal No. E/849/07 2. We examine the Revenue appeal in detail. Respondent paid AED (GSI) on one of its major inputs, tyre cord fabrics, and accumulated the credit as its final products were automotive tyres and the same did not attract AED (GSI). The relevant Modvat Rules/Cenvat Rules prohibited utilization of credit of one category of duty for payment of another category of duty. By Notification No. 13/2003-N.T., dated 1-3-2003, government allowed utilization of AED (GSI) for payment of BED by an amendment of Explanation to Rule 3 of CCR. By Section 88 of Finance Act, 2004, this Explanation was retrospectively amended to prohibit use of credit of....
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....escribed documents; the same was utilized as per the Notification No. 13/03-N.T. issued by the government. The payment of duty utilizing credit irregularly was since made good by payment from PLA as per the prescriptions in Finance Act, 2005. Once the payment was made from PLA, the credit initially utilized to pay the same liability deserved to be restored. He cited the following case laws in which the Tribunal had ordered that the assessee was entitled to restoration of credit initially utilized in an irregular manner, after payment of the dues in cash or from PLA. 1. Friends Wire Industries v. CCE - 1995 (80) E.L.T. 219 (Tri.) 2. Steel Authority of India v. CCE - 2001 (127) E.L.T. 749 (Tri.) 3. Mahindra & Mahindra v. CCE - 1995 (79) E.L.T. 151 (Tri.) 4. CCE v. Punjab Maize Products - 1996 (84) E.L.T. 360 (Tri.) 5. We have perused the case records and carefully considered the rival submissions. The common case of the parties is that the assessee-CEAT had procured tyre cord fabrics paying AED (GSI) and used in the manufacture of its final product automotive tyres. As tyres and flaps did not attract AED (GSI) and since the relevan....
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....of duty of excise leviable under the First Schedule or the Second Schedule to the Central Excise Tariff Act, 1985 (5 of 1986)." As per these provisions, the appellants were barred from using the accumulated AED (GSI) credit earned on procurement of tyre cord fabrics prior to 1-4-2000. As on 1-3-2003, the assessee had a total credit of about Rs. 32,78,21,329/-, out of which an amount of Rs. 20,49,01,087/- had been earned prior to 1-4-2000. Had the Rule 3(6)(b) of C.C.R. not been amended with effect from 1-3-2003, the assessee would have continued to have a balance of Rs. 32,78,21,329/- including Rs. 20,49,01,087/- earned prior to 1-4-2000. Since the Finance Act, 2004 prohibited use of AED (GSI) for payment of BED, the credit balance of AED (GSI) would remain undisturbed in its account. During July, 2005 to June, 2006, the assessee had paid an amount of Rs. 65,54,373/- every month from AED (GSI) and later discharged the same liability by payment of duty from PLA. We find that credit is intended to be spent only to pay duty. The department had not recognized debits from AED (GSI) as payment of BED. Therefore, such debits cannot be held to have affected the balance of AED (GSI) in the....
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....upra, the Tribunal found that the respondents had wrongly availed Modvat credit for payment of duty on MCI inserts by debiting their RG 23A Part II account. The Tribunal ordered that once they had regularized such wrong utilization of Modvat credit by payment of duty from their PLA, the RG. 23A account had to be credited with the amount debited earlier. 8. We find that the judicial authorities cited by the appellants are to the effect that once the utilization of Modvat/Cenvat credit for payment of duty was found to be irregular and the duty was then paid from PLA, the assessee became automatically entitled to credit of equivalent amount in its RG 23A account. 11. We find that the Tribunal had dealt with a different dispute in Final Order No. M/159/08/SMB/C-I, dated 9-7-2008 in the case of BDH Industries Ltd. [2008 (229) E.L.T. 364 (Tri. - LB)]. In the said decision, the Tribunal had considered two cases : (a) Motorola India Pvt. Ltd. [2006 (193) E.L.T. 468 (T) = 2007 (7) S.T.R. 613 (T) = 2005 (71) RLT 334] In this case the appellant had paid excess duty by mistake and thereafter sought permission to take credit of the amount paid by mistake. The Tribunal held that the a....