TaxTMI 
TaxTMI 
2014 (1) TMI 1473
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....on the fact of appellant's entitlement for the said credit as held by the third respondent and which has not been reviewed/appealed against by the second respondent? 2. Whether the Tribunal is right in dismissing the appeal on the above ground when the issue for decision before it was whether the appellant is right in taking suo motu re-credit or the appellant ought to have filed refund claim under Section 11B of the Central Excise Act, 1944 as proposed in the show cause notice dated 27.11.2008 issued by the third respondent? 3. Whether the Tribunal is right in not considering the various Tribunal judgments relied upon by the appellant wherein it has been categorically held that suo motu recredit of credit reversed during proceedings are permissible and no refund claim under Section 11B of the Central Excise Act, 1944 is required? 4. Whether the Tribunal is right in holding that the right course of action for the appellant is to seek redressal in the higher judicial forum, if they are aggrieved by the earlier order when appellant's entitlement for the said credit is not at all based on the said earlier order of the Tribunal but it is based on the provisions of Rule 6(5) ib....
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.... taking suo motu credit. A show cause notice was issued to the assessee calling upon it to show cause as to why a sum of Rs.3,21,308/- being the ineligible service tax credit taken and utilised for payment of duty for clearance of their finished goods should not be demanded under Rule 14 of the Cenvat Credit Rules, 2004 read with Central Excise Act, 1944. Apart from this, the notice also alleged that the amount of Rs.6,009/- and Rs.8,328/- being the ineligible credit reversed should not be appropriated under Rule 14 of the Cenvat Credit Rules, 2004. The notice also proposed interest in terms of Rule 14 of the Cenvat Credit Rules,2004 r/w Section 11AB of the Central Excise Act,1944 and penalty under Rule 15 of the Cenvat Credit Rules,2004 for contravening the provisions of the Act. 7. The assessee resisted the proceedings by quoting the clarificatory letter issued by the CBEC vide Letter F.No.1437/203/2007 Cx4 dated 01.10.2007 and contended that for taking a re-credit, there was no need for reversal of the said credit as the same being protected under Rule 6(5) of the Cenvat Credit Rules, 2004 and as clarified by the CBEC Circular. The Adjudicating Authority however pointed out t....
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.... of the amount reversed earlier, they could not now take recredit of the same without a specific relief having been granted to them by the Tribunal. It further pointed out that there was no finding by the Tribunal in the earlier round of litigation on the amount of Rs.3,21,308/- to take suo motu credit, which was forming part of the sum of Rs.5,38,796/-, which was reversed earlier by the assessee. The mere fact of the Tribunal allowing the appeal in the earlier round itself would not be a good ground for the assessee to take suo motu credit. In the circumstances, the Tribunal rejected the assessee's appeal, as against which, the present appeal has been preferred by the assessee. 11. The assessee are manufacturers of Mono Cartons and Printed Paper Labels. Evidently, the cartons are subjected to excise duty and the printed paper labels are exempted from payment of duty vide Notification No.10/2003 CE dated 01.03.2003. According to the Revenue, common inputs were utilized in the manufacture of exempted items as well as dutiable items. The allegation of the Revenue is that the assessee had not maintained a separate account in respect of input services. Thus for the period from Septe....
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....aid by him and the incidence of such [duty and interest, if any, paid on such duty] had not been passed on by him to any other person: Provided that where an application for refund has been made before the commencement of the Central Excises and Customs Laws (Amendment) Act, 1991 (40 of 1991), such application shall be deemed to have been made under this sub-section as amended by the Act and the same shall be dealt with in accordance with the provisions of sub-section (2) as substituted by that Act:] [Provided further that] the limitation of [one year] shall not apply where any [duty and interest, if any, paid on such duty] has been paid under protest. [(2) If, on receipt of any such application, the [Assistant Commissioner of Central Excise or Deputy Commissioner of Central Excise] is satisfied that the whole or any part of the [duty of excise and interest, if any, paid on such duty] paid by the applicant is refundable, he may make an order accordingly and the amount so determined shall be credited to the Fund: Provided that the amount of [duty of excise and interest, if any, paid on such duty] as determined by the [Assistant Commissioner of Central Excise or Deputy Co....
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....rder of the Tribunal in the earlier round of litigation would show that it accepted the assessee's case of suo motu reversal of the entry. That being the case, the subsequent conduct of the assessee for a follow up action on an amount of Rs.3,21,308/-, which is only an account entry adjustment, technically speaking cannot be taken exception to either by Tribunal or for that matter by the Revenue. For this, we do not find any need for a finding to be given in the order of the Tribunal in the earlier round of litigation. 16. We do not for a moment deny the fact that a sum of Rs.3,21,308/- for which suo motu credit was taken by the assessee was forming part of Rs.5,38,796/-, which was earlier reversed by the assessee. On the admitted fact, Rs.3,21,308/- represented the enumerated input services as given under Rule 6(5) of the Cenvat Credit Rules, 2004, we have no hesitation in accepting the plea of the assessee that on a technical adjustment made, the question of unjust enrichment as a concept does not arise at all for the assessee to go by Section 11B of the Central Excise Act, 1944. 17. In the circumstances, we set aside the order of the Tribunal and allow the appeal filed by ....