TaxTMI 
TaxTMI 
2011 (2) TMI 94
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....ks declaration that these three units and the trading units of the petitioner are covered by LTU . 3 Before dealing with the submissions of learned counsel of both the sides it is necessary to state in brief the scheme of LTU which was introduced in India in the year 2006. LTU is a facility made available by the Government to facilitate the trade and to boost the industrial development . Concept of LTU is not novel to the international practice. Our Finance Minister in his speech on budget proposal of 2005-2006 announced establishment of LTU so that the industries and corporate sector may avail of single window service and such LTU would be set up in major cities . Interalia the State issued notifications no.18/06 (CE)/(NT)2 , 22/006 CE(NT) and 28/2006 S.Tax all dated 30/9/2006 providing jurisdictional authority for LTU and made changes in the Central Excise Rules ,2002 Cenvat Rules 2004 and service tax rules 1994 . A new rule 12(b)(b) has been added in the Central Excise Rules,2002 , a Rule 12(a) was inserted in Cenvat credit Rules 2004 and similarly Rule 10 has been inserted in Service Tax Rules 1994. On 3/10/2006 first LTU was set up at Banglore. 4 As per the notifi....
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....e,LTU by way of show cause notice dated 17/12/2009 sought to disallow the total credit on the ground that the unit at Kanchipuram and Nasik were not mentioned in the original consent form filed by the petitioner in March, 2006 and therefore, they are not part of the LTU. Further it was communicated by letter dated 7/1/2010 by the Chief Commissioner ,LTU that the facility of transfer of credit is effective only after the receipt of the letter by the assessee of the consent and the transfer of credit of the assessee on 27/11/2008 was incorrect. Nasik unit of the petitioner was also served by show cause notice on 4/2/2010 by which the Commissioner sought to disallow Cenvat credit amounting to Rs.1.73 crores which was availed during the period from January, 2009 .The petitioner filed detailed reply to the show cause notice in April, 2010 contending that Kanchipuram and Nasik units after March, 2006 should be treated as a part of LTU and, therefore, Cenvat credit was properly transferred. However, on 13/8/2010 LTU sent a letter stating that Nasik unit does not fall under the jurisdiction of LTU Delhi and E.R.returns filed by Nasik Unit from September , 2009 to July, 2010 were forwarded ....
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....o given for those units which were mentioned in the consent letter. The names and the details of these three units were not mentioned and furnished to the Chief Commissioner of LTU so the respondents have taken a correct decision as not to recognize these three units as a part of LTU and therefore, the action of the respondent is justified. 8 The petitioner admittedly is a LTU and operating its accounts since 2006 for which petitioner has received the acceptance of the respondent. It is not disputed by the petitioner that the petitioner did not mention the name and the details of three new units which started operating after the submission of the consent letters for its other units. The action of the Chief Commissioner of LTU may appear correct in holding that these three units at Nasik, Kanchipuram and Singur do not form a part of LTU for want of consent letter from the petitioner and the acceptance to these three units to operate as a part of LTU; however, the fact of some transactions of all the units and intimation to LTU by the petitioner cannot be over looked but has vital bearing over the issue. For instance earlier the petitioner has requested the transfer of the credit ....
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....in India as referred in the speech of the Finance Minister in the year 2005 as a benevolent scheme. Therefore,though there is a procedural flaw on the part of the petitioners this irregularity is curable in the interest of the scheme and to refuse the benefit of the scheme to the petitioner is a hypertechnical approach .We are of the opinion that the action of the Chief Commissioner to refuse to accept new units as a part of LTU and issuing show cause notice to them regarding transfer of Cenvat credit is not tenable under the scheme. 10 Thus, in the present case,though the initial consent letter given by the petitioner related only to the six units,both the petitioner and the revenue since inception have proceeded on the footing that the petitioner had opted for the LTU facility not only for the six units but also in respect of all the other units set up subsequent to the initial consent letter. This is evident from the fact that since inception the petitioner has been filing ER-1 returns in respect of all the units (including the subsequently set up unit at Nashik) before the LTU at Delhi and even the LTU Delhi has treated that all the units of the petitioner are governed by th....