TaxTMI 
TaxTMI 
2019 (1) TMI 499
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.....09.2014. The revenue is on appeal before us challenging the said order. 2.For the sake of convenience, the parties shall be referred to as per their rank assigned in the writ petition. 3.The writ petitioner challenged the show cause notice on the ground that it is without jurisdiction, clear abuse of process of law and therefore, the revenue should be prohibited from proceeding further with the show cause notice. Before the learned Single Bench, the revenue raised preliminary objections regarding the maintainability of the writ petition, which objection was overruled by the learned Single Bench and it was held that the writ petition would be maintainable when the show cause notice was issued without jurisdiction and it is a clear abuse of process of law. 4.Mr.Rajnish Pathiyil, learned Senior Central Government Standing Counsel appearing for the revenue reiterated the said objection which was raised before the learned Single Bench and relied upon the following decisions which were cited before the learned Single Bench, which is as follows: 1.Medopharam vs. Superintendent of Central Excise, Madras reported in 1995 (77) ELT 524 (Mad); 2.State of Madhya Prad....
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....d by the learned counsel appearing for the revenue and rightly noted that writ petitions are not maintainable against the show cause notice and the jurisdiction of this Court under Article 226 of the Constitution of India to interfere with the show cause notice is extremely limited and circumscribed. Further, as rightly observed by the learned Single Bench, it is not a case of inherent lack of jurisdiction but an imposed restriction which has been elucidated in several decisions which were cited by Mr.Rajnish Pathiyil, learned SCGSC appearing for the revenue. In the decisions cited by the learned senior counsel appearing for the writ petitioner, the Court have pointed out that under which circumstances, a show cause notice can be interfered. Therefore, to that extent, Mr.Rajnish Pathiyil is correct in contending that the writ petition challenging a show cause notice should not be entertained. However, we do not agree with his submission that there is an absolute and total bar for entertaining a writ petition which has been clarified by the Hon'ble Supreme Court in several decisions and when a show cause notice is challenged as being without jurisdiction or when it is a case of ....
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.... taxable and exempted services. Sub-rule (1) of Rule 6 states that CENVAT Credit shall not be allowed on such quantity of input or input service which is used in the manufacture of exempted goods, except in the circumstances mentioned in sub-rule (2) of Rule 6. Sub-Rule (2) of Rule 6 obliges the manufacturer or provider of output service, who avails CENVAT Credit and who manufactures final products which are chargeable to Duty as well as exempted goods to maintain separate accounts. Subrule (2) of Rule 6 reads as follows:- "(2) Where a manufacturer or provider of output service avails of CENVAT credit in respect of any inputs or input services, and manufacturers such final products or provides such output service which are chargeable to duty or tax as well as exempted goods or services, then, the manufacturer or provider of output service shall maintain separate accounts for receipt, consumption and inventory of input and input service meant for use in the manufacture of dutiable final products or in providing output service and the quantity of input meant for use in the manufacture of exempted goods or services and take CENVAT credit only on that quantity of inpu....
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....h should have been borne in mind by the revenue is that notifications issued by the Government deal only with the petroleum gases and other gaseous hydrocarbons received by the factory from the refinery intended for use in the manufacture of polyisobutylene or Methyl Ethyl Ketone (MEK) and returned by the factory to the refinery from where such petroleum gases and other gaseous hydrocarbons are received. The notification contains an explanation which states that for the purposes of the exemption the quantity of the petroleum gases and other gaseous hydrocarbons consumed in the manufacture of polyisobutylene shall be calculated by subtracting from the quantity of the said gases received by the factory manufacturing polyisobutylene the quantity of the said gases returned by the factory to the refinery, declared as such under Rule 20 of the Central Excise Rules, 2002, which supplied the said gases. Thus, what is to be borne in mind is that the product is petroleum gases and other gaseous hydrocarbons. If we turn to the show cause notice issued, the attempt of the revenue is that the composition of the goods received by CPCL and the goods returned to CPCL are different in its chemical ....
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.... been passed on by them, in any form, to their consumers. The quantity of polybutene enriched LPG consumed in the manufacture of polybutene shall be calculated by subtracting from the quantity of polybutene enriched LPG received by the factory manufacturing polybutene, the quantity of LPG generated in such manufacture and returned by the manufacturer of MRL. 8.The refund application filed by KSCL may be considered by the Assistant Collector of Central Excise in the light of the exemption contained in this adhoc exemption order. The amount of refund as may be found admissible would be subject to the provisions of Section 11B of the Central Excises and Salt Act, 1944." 11.The Central Government clearly understood the manufacturing process and taken into consideration that the return quantity of LPG has ultimately been cleared on payment of appropriate duty by oil Companies, the Central Government is satisfied that the burden of excise duty on the returned quantity of LPG, which was originally supplied by MRL to the writ petitioner at the price for industrial use, has fallen on the writ petitioner which is much more than the excise duty applicable on the quantity of LPG ac....
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.... value of net quantity of polybutylene feedstock and liquefied petroleum gas retained for the manufacture of Poly Iso Butylene and Propylene or Dibutyl Para Cresol. 4. Accordingly, it is hereby clarified that, in the aforesaid cases, GST will be payable by the refinery only on the net quantity of Polybutylene feedstock and Liquefied Petroleum Gas retained by the manufacturer for the manufacture of Poly Iso Butylene and Propylene or Di-butyl para Cresol . Though, the refinery would be liable to pay GST on such returned quantity of Polybutylene feedstock and Liquefied Petroleum Gas, when the same is supplied by it to any other person. 5. This clarification is issued in the context of the Goods and Service Tax (GST) law only and past issues, if any, will be dealt in accordance with the law prevailing at the material time. Yours faithfully, (Mahipal Singh) Technical Officer (TRU) Email: [email protected] 13.The above circular is also an answer to the revenue because the GST Council clarified that GST will be payable by the refinery on the value of net quantity of polybutylene feedstock and liquefied petroleum gas retained ....