2016 (2) TMI 284

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....he Revenue initiated proceedings against the appellant for recovery of Central Excise duty short paid during the period April, 2003 to October, 2008. The first show cause notice dated 04/11/2008 was issued covering period from April 2005 to December 2007; the second show cause notice dated 03/12/2008 was issued covering period from January 2008 to October 2008. The issue in brief is that the appellant have not paid full amount of VAT received on sale of finished goods from the buyer to the sales tax department. They retained certain amount as per the scheme announced by the Punjab Government. The proceedings initiated against the appellant to demand differential central excise duty is on the ground that the retained amount is not actually p....

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....aw, has been settled by the Hon'ble Supreme Court in the case of CCE, Jaipur - II vs. Super Synotex (India) Ltd. (supra) and in Maruti Suzuki India Ltd. - 2014 (307) E.L.T. 625 (S.C.) . The appellants have no case on merits. This has been admitted by the learned Counsel by the appellant. However, the appellants are contesting a part of the demand confirmed, on the question of time bar. The first show cause notice dated 04/11/2008 was issued invoking extended period of limitation in terms of proviso to Section 11A of the Central Excise Act, 1944. The appellants main plea is that the whole issue regarding the quantum of deduction of sales tax in respect of incentive schemes announced by the State Government/credit set off, is a subject ma....

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....d above. The Hon'ble Supreme Court in the case of Super Synotex (India) Ltd. observed as below:- "26. In view of the aforesaid analysis, we are of the considered opinion that the assessees in all the appeals are entitled to get the benefit of the circular dated 12/3/1998 which protects the industrial units availing incentive scheme as there is a conceptual book adjustment of the sales tax paid to the Department. But with effect from 01/07/2000 they shall only be entitled to the benefit of the amount "actually paid" to the Department, i.e. 25%. Needless to emphasise, the set off shall operate only in respect of the amount that has been paid on the raw material and inputs on which the sales tax/purchase tax has been paid. That be....