2016 (10) TMI 34

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....en on High Speed Diesel along with interest and imposition of penalty against the appellants viz., Gem Granites. 3. Appellants have been represented by learned advocate, Shri G. Shivadass, who inter alia submits as follows: * M/s. Gem Granites are 100% EOU. They manufacture cut and polished granites and are registered under Central Excise Act, 1944. * The appellants have been granted private bonded warehouse license under Section 58 of the Customs Act, 1962 and   in-bond manufacturing sanction order under Section 65 of Customs Act, 1962.Consequent to the withdrawal of the warehosuing facility, the CBEC vide Circular No. 799/32/2004 CX dated 23.09.2004 clarified that EOUs could receive goods on payment of duty ....

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....010 dated 29.06.2010 19/2011 dated 30.11.2011 5. Amount Demanded Rs. 90,32,688/- Rs. 51,46,704/- Rs. 91,66,176/- 6. Penalty Imposed Rs. 7,50,000/- Rs. 3,50,000/- Rs. 2,00,000/- 3.1 The appellants mainly argue against the orders confirming the demand and imposing penalties inter alia as follows: i. The facility of Cenvat Credit was extended to EOUs w.e.f. 06.09.2004 vide Notificaiton No. 18/2004-CE(NT) dated 06.09.2004 which amended Rule 17 of the Central Excise Rules, 2002 to enable EOUs to pay duty on clearances made to DTA by utilizing Cenvat Credit. The amended provision made it clear that the Appellants are entitled to avail Cenvat Credit and utilise the same towards payment of duty. In view ....

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.... v. The Appellants place reliance on the decision in the case of Commissioner of Central Excise Vs. Jagmini Micro Knit Pvt Ltd reported in 2009 (238) ELT 327 (Tri. Del.). The issue before the Hon'ble Tribunal was whether the Appellants are entitled to avail CENVAT Credit of the duty paid on High Speed Diesel Oil. The Appellate Tribunal observed that since the assessee is a 100% EOU, the Notification makes them entitled to take Credit. vi. The Appellants further submit that it is always the legislative intent that duty incidence on procurements of EOU be Nil. Here the EOU procures HSD on payment of duty, the supplier is extended deemed export drawback in terms of Para 8.3 of the FTP. Therefore, where the supplier has not ava....

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.... Jagmini Micro Knit Pvt. Ltd. (supra) they are entitled to the CENVAT credit. 4. The Revenue has been represented by the learned AR Shri Ajay Saxena who has reiterated the findings given in the impugned orders. He has also cited the following case laws in support of the impugned orders. (i) Sangam Spinners vs. UOI: 2011 (266) E.L.T. 145 (S.C.) (ii) Imperial Granites (P) Ltd. vs. CCE, Guntur: 2012 (276) E.L.T. 174 (AP) (iii) Imperial Granites P. Ltd. vs. CCE, Guntur: 2010 (256) E.L.T. 610 (Tri.-Bang.) 5. We have carefully considered the full facts of the case and submissions of both the sides and the case laws cited. 6.1 The main issue concerns with the CENVAT credit taken by the appellants who are a 100% ....