TaxTMI 
TaxTMI 
2014 (6) TMI 935
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....mount of refund claimed & rejected (in Rs.) for non-fulfilment of condition of 2nd substantial expansion of existing unit laid down under the notification No. 01/2010, dated 6-2-2010 Basic excise duty Amount of refund availed as self credit and utilized for payment of duty 1 129-137/14 3248-3256/AC/R(S)/JMU//13, dated 6-2-2014 April, 2013 6083221 - 2 May, 2013 4437612 3370705 3 June, 2013 7120420 4073102 4 July, 2013 3110932 4339073 5 Aug, 2013 1004343 1985163 6 Sep, 2013 1523366 619645 7 Oct, 2013 953257 837946 8 Nov, 2013 2248105 787135 9 Dec, 2013 2919128 1930491 Total 2,94,00,384 1,79,43,260 1.1 As the issues involved in these appeals are same, therefore, these are being taken up together for disposal through this common order. 2. Briefly stated, the appellants, holding Central Excise Registration No. AAACF3272AXM001, for manufacture of Pesticides, Insecticides, Weedicides, Herbicides & Fungicides, falling under Chapter Heading No. 38 of the 1st Schedule to the Central Excise Tar....
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.... Act, read with para 5(e) of the new notification. 3. Being aggrieved, the appellants have filed these appeals, along with the stay applications, on the following grounds :- (i) That the impugned orders are bad in law inasmuch as they violate the principle of natural justice as no opportunity is given to them to explain their case and these orders lacks appreciation of the provisions of the new notification. (ii) That it is settled position that in case the claim of an assessee is to be rejected, the assessee must be given opportunity to explain his case before such an order is passed. No such opportunity was accorded to the appellants. Reliance placed on the case law of CCE, Jaipur-II v. Anna Petrochem Pvt. Ltd. [2009 (247) E.L.T. 512 (Tri.-Del.) & Punjab Paint Colour & Varnishes Works Pvt. Ltd. v. CCE, Kanpur [2007 (208) E.L.T. 85 (Tri.-Del.) = 2007 (5) S.T.R. 57 (T). (iii) That the substantial expansion, in terms of the new notification can take place either by way of increase by not less than 25% in the value of fixed capital investment in plant & machinery for the purpose of expansio....
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....ssued by the Chartered Accountant and other facts on record. The claim of the appellants is duly certified by the Chartered Accountant, certifying installing machinery worth Rs. 1,78,40,875/- i.e. an increase of 32.75% in fixed capital investment in plant and machinery. 4. Personal hearing in the Stay Applications of the appellants was held on 25-4-2014. Shri Naveen Prothi. President of the appellants appeared and reiterated the submissions made in their Stay Applications as well as in their main appeals and also submitted copies of documents such as, G.M., DIC's order dated 7-3-2014, Form SE-B, ALC NO. ALC/S/720, dated 10-1-2014, G.M., DIC's letter dated 18-1-2014 and 15-4-2014 & J&K State Pollution Control Board's letter dated 7-3-2014. The appellants were asked to produce Labour Register from 1-4-2012 onwards and PDD (relating to power load) which they promised to submit by 2nd of May, 2014. The appellants requested that both their appeals and their stay applications may be disposed of together. The appellants, vide letter dated 5-5-2014, submitted copies of the following documents which they had promised to submit during the personal hearing. (i) &nb....
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....r recovery, alongwith due amount of interest. 7. Before discussing merits of the cases, it is worthwhile to look into the relevant provisions of the new notification, relating to the conditions of substantial expansion which enable the existing industrial units to avail the area based exemption. The relevant provisions of the new notification are reproduced as under. "8. The exemption contained in this notification shall apply only to the following kind of units, namely :- (a) New Industrial units which commence commercial production on or after the 6th day of February, 2010; (b) Industrial units existing before the 6th day of February, 2010; but which have, - (i) undertaken substantial expansion by way of increase by not less than 25% in the value of fixed capital investment in plant and machinery for the purposes of expansion of capacity or , modernization and diversification and have commenced commercial production from such expanded capacity on or after the 6th day of February, 2010 or (ii) made new investments on or after the 6th day of February, 2010, and such new investment is directly att....
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....n to the existing industrial units which had earlier availed the area based exemption under the notification. On my these observations, I place reliance on Board's Circular No. 977/01/2014, dated 3-1-2014, relevant portion of which is reproduced as under :- "2.2 Notification Nos. 56/2002-C.E. & No. 57/2002-C.E. and Notification No. 1/2010-C.E. does not specifically provide any cut-off date (sunset clause) for setting up of new units or for units undertaking substantial expansion. Further, Notification No. 1/2010-C.E. does not debar an existing unit which has availed of excise duty exemption under Notification No. 56/2002-C.E. & 57/2002-C.E., both dated 14-11-2002 by way of substantial expansion, to avail of excise duty exemption again by way of substantial expansion. 3. It is, therefore, clarified that an existing unit which has availed of excise duty exemption under Notification No. 56/2002-C.E. & 57/2002-C.E., both dated 14-11-2002 by way of substantial expansion can avail of excise duty exemption under Notification No. 1/2010-C.E., dated 6-2-2010 again by way of second substantial expansion so long as it satisfies the conditions stipulated under Notif....
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....-, over which addition in investment under substantial expansion is of Rs. 1,78,40,875/- representing an increase of 32.75%. As regards the observation of the adjudicating authority that it is not clear as to whether this value of plant & machinery as at 31-3-2012, is written down value or the un-depreciated value, I find that as per note 8 to the appellants Balance Sheet for the year 2012-13, as at 31-3-2012, the Gross Block (un-depreciated value) of plant & machinery is Rs. 5,44,77,279/- and the net value (depreciated value) is Rs. 3,27,39,450. Addition in plant & machinery during the year is Rs. 1,78,40,875/-. Thus, the Gross Block of plant & machinery as at 31-3-2013 is Rs. 7,23,18,154/- and the net block is Rs. 4,79,00,043/-. On analysis of this data, I observe that %age increase in plant & machinery of appellants unit, during substantial expansion, over the un-depreciated value of plant & machinery (Gross Block) is to the tune of 32.75% and this %age increase over the depreciated value (Net Block), of Rs. 3,27,39,450/- is to the tune of 54.49%. 9.3 In view of the above discussions, I hold that the appellants have fulfilled the condition of substantial expansion, by wa....
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.... not less than 25%, over the base employment limit. 11. As regards admissibility of refund by way of self credit which the appellants have claimed and availed/utilized, I find that , as detailed in the above table, during the period from 1-4-2013 to 31-12-2013, though the appellants have claimed refund of Rs. 2,94,00,384/-, but they have availed and utilized refund of Rs. 1,79,43,260/-. Vide the impugned orders, the adjudicating authority has rejected the refund claimed by the appellants and has ordered recovery of refund alongwith interest, which has been availed and utilized by the appellants. On this point, I observe that though the appellants are entitled to refund of duty, by way of self credit, as they have fulfilled the conditions of substantial expansion contained in para 8(b) of the new notification However, they are entitled to refund of duty in terms of the value addition norms contained in para 2 of the new notification. Since, the amount of refund admissible to the appellants has not been quantified in the impugned orders, therefore, I order that the adjudicating authority would quantify the amount of refund admissible to the appellants in accordance with para ....