TaxTMI 
TaxTMI 
TaxTMI 
2023 (2) TMI 734
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....ms falling under Chapters 72 and 73 of the Central Excise Tariff Act, 1985 (the "Tariff Act") used to erect towers for installing transmission equipment. Similarly Cenvat Credit was also being availed on pre-fabricated buildings, shelters, PUF panels falling under Chapter heading 9406, which were used for housing/storage of generating sets and other components/equipments/spares etc. 4. According to the Revenue, since the telecom towers erected at site and affixed to earth were not goods, the activity of erection of towers did not amount to manufacture. That as the towers so erected were neither excisable goods nor any output service defined under the provisions of the Finance Act, 1994, they attracted neither levy of Central Excise Duty under the provisions of Central Excise Act, 1944 nor Service Tax under Finance Act, 1994. Any input or material used for erection of towers were not an input in terms of the provisions of Cenvat Credit Rules. The availment of Cenvat Credit by the notice on materials such as angles, channels, beam etc. therefore, appeared irregular and incorrect. 5. The Respondent had also availed Cenvat Credit on prefabricated buildings shelters, PUF Panels as wel....
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.... therefore, do not appear to fall under the category of "input" used for providing the telecom service. Cenvat credit wrongly taken is not admissible in terms of Rule 2(a) of the Cenvat Credit Rules. 9. Since it appeared to the Revenue that the assessee had wrongly availed the cenvat credit to the tune of Rs. 5,75,93,284/- for the period from April 2004 to December 2007 and utilized it wrongly towards payment of service tax and education cess on the output services and thereby contravened the provisions of Rule 3(1) (ix) and Rule 3 (4) (e) of the Cenvat Credit Rules, 2004, the assessee was served with a Show Cause Notice dated 22.01.2009 by the Commissioner of Service Tax, Mumbai, thereby calling upon them to show cause as to why:- (a) Cenvat credit of Rs. 5,75,93,284/- for the period from April, 2004 to December, 2007 taken by them should not be disallowed and recovered from them under the provisions of Section 11A of the Central Excise Act, 1944, read with Rule 14 of the Cenvat Credit Rules, 2004 and proviso to Section 73 of Finance Act, 1994; (b) penalties should not be imposed and recovered from them under the provisions of Rule 15 of Cenvat Credit Rules, 2004 read with S....
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....acted in gross contravention of the provisions of the Cenvat Credit Rules, 2004, with intent to evade service tax by way of illegally availing Cenvat credit in respect of ineligible goods and (iii) The assessee has failed to establish the bonafide basis of their purported belief. B. Whether it is open to CESTAT to read into the provision of proviso to Section 73(1) and Section 78 of the Finance Act, 1994. The purported factor 'interpretative nature of an issue' to reject the extended period of limitation, and to hold that there was no contravention of kind stipulated therein. C. Whether the CESTAT was right at holding the matter as under dispute / purporting to be of interpretative nature even after the CBEC, vide Circular 137/315/2007-CX. 4 dated 26.02.2008 had specifically informed that goods of such nature were not eligible for Cenvat credit in as much as the same was not 'inputs' and the same was not used for providing taxable service. The assessee didn't contest/protest such circular before departmental authorities. D. In the light of specific exclusion of the goods from the scope of the term 'inputs' by virtue of notification 16/2009-C.E. (N.T.) dated 07.07.....
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....he substantial question of law raised in the present appeal were similar to those raised in C.E.X.A. no.6/2017. However the counsel of the Appellant Revenue pointed out to the court that while invoking extended period of limitation, no comparisons or similarities could be drawn and it is the conduct of the parties which determines whether the extended period of limitation under Section 73(1) should be invoked or not. In the light of submissions, this Hon'ble High Court by and order dated 14th January 2020 allowed the Appellants to distinguish this appeal by presenting reframed questions of law by the concerned officer by filing an affidavit. I say that on examining the substantial questions of law as framed in C.E.X.A. no. 6/2017 in the light of the Show Cause Notice issued in the facts and circumstances of that case, the questions of law framed from Serial No.A,B,C and D were completely unnecessary. The reason being that the Show Cause Notice dated 27.09.2011 bearing No. V/ST/Dn-V/Bel/Gr-VI/Misc/09- 10/600 which was issued to Reliance Communication limited, the assessee in C.E.X.A. no. 6/2017 was within the limitation period covering the period April 2010 to March 2011. In i....
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....eto anenxed and marked as Annexure 1 is copy of Show Cause Notice dated 27.09.2011 bearing No. V/ST/Dn-V/Bel/Gr-VI/Misc/09-10/600. In the light of facts herein above, it would not be proper to refer and rely upon order dated 02.04.2018 passed by this Hon'ble Court in C.E.X.A. no. 6/2017 since the issues are completely different as borne out by the Show Cause Notice dated 27.09.2011 bearing No. V/ST/Dn-V/Bel/Gr-VI/Misc/09-10/600 issued in CEXA no. 6/17. It is pertinent to note that the show cause otice in the present appeal i.e. 92 of 2019 pertains to the extended period and the penalties which follow which were both set aside by the Tribunal against which the present appeal is filed. It is important to note that it is the show cause notice that is germane to all the consequent proceedings that follow. I further say and submit that the invoking of the extended period of limitation can be in the circumstances mentioned in section 73(1) i.e. fraud, collusion, willful mis- statement, suppression of fact or contravention of any provisions, of the Finance Act 1994. The show cause notice in the present case mentioned clearly in para 9 that the noticee has suppressed the fact of avai....
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.... Appeal No. 6/2017 are the same. This Hon'ble Court further observed that if it is the endeavor of the Appellant to distinguish this appeal by presenting reframed question of law, the same shall be done by the concerned Officer by filing an affidavit. 5. Pursuant to the above Order of this Hon'ble High Court, an affidavit dated 07 February 2020 has been filed on the behalf of the Appellant by one Ms. Swati Shiwam, Joint Commissioner, CGST & C. Ex., Belapur and in reply thereto I am filing the present coutner-affidavit. 6. I say that due to nationwide lock down imposed from March 2020 in the wake of Corona pandemic I could not file this rejoinder earlier and request leave of this Hon'ble Court to condone the delay, if any, in filing this rejoinder affidavit. The facts stated herein are relevant and crucial to decide the present appeal and hence the same may kindly be permitted to be taken on record. 7. I say that the attempt by the Appellant to distinguish the ratio and reasoning in the Order dated 02 April 2018 of this Hon'ble High Court is futile and the same would apply in full force to the present appeal as well, for the following reasons. a) The Appellant's endevour....
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.... High Court has further observed that in spite of an earlier authoritative pronouncement of this Court , the matter was again debated and brought before this Court and finally settled. 10. I say that this Hon'ble Court has observed that bearing in mind the debatable legal issue of interpretation, the Ld. Appellate Tribunal has dropped the demand pertaining to the extended period of limitation and the penalty imposed. I submit that if that be the case the chare of suppression cannot survive and the present appeal be dismissed. 11. I say and submit that the above Order dated 02 April 2018 of this Hon'ble High Court in the connected proceedings is squarely applicable to the facts of the present case and the grounds stated in the affidavit contending that the above judgment dated 02 April 2018 cannot be relied upon and are untenable in law. 12. I say that the Appellant in the Affidavit dated 07 February 2020 has further stated that "the show cause notice in present appeal clearly mentioned at paragraph 9 that notice has suppressed the fact of availment of Cenvat credit on the items/goods mentioned as the same is not evident from ST return. It is important to note that there wa....
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....xtended period of limitation viz. Fraud, collusion, willful misstatement or sppression with an intent to evade tax are found in the present case and hence extended period cannot be invoked for confirming the demand against the Respondent. 18. I refer to the following judgments wherein it is held that extended period of limitation cannot be invoked and penalty cannot be imposed in cases which are debatable and involve interpretation of law. i. Associated Pigments Ltd. vs Superintendent of Central Excise. 1993 (68) ELT 514 (Cal.) ii. Union of India vs Bharat Aluminium Co. Ltd. 2012 (26) STR 101 (Chhattisgarh) iii. Unifex Cables Ltd. vs. Commissioner of Central Excise, Surat-II, 2011 (271) ELT 171 (SC) iv. Commissioner of C. Ex.vs Gujarat Narmada Fertilizers Co. Ltd., 2009 (240) ELT 661 (SC). v. Union of India vs. Beryl Drugs Ltd., 2015 (322) ELT 261 (MP) 19. I say that, in any event the Ld. Appellate Tribunal in the impugned Order dated 16 March 2015 has also observed that issue of availment of credit on the towers and pre-fabricated buildings and shelters was disputed before various forum and hence all the Appellants before it could have entertained a bonafide b....
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....lso refers to the case of Reliance Communication Limited, which was the subject matter of the decision of this Court dated 2nd April, 2018 in CEXA No. 6 of 2017. The said order is usefully quoted as under:- "We have heard both sides. 2. Revenue has filed this Appeal against the impugned order dated 16th March, 2015, essentially on a limited issue. Though it is proposing five questions as substantial questions of law, we find that, on the own showing of the parties, this was a debatable issue. Despite an authoritative pronouncement of this Court earlier, the matter was again debated, again brought before this Court and finally settled. Since what was cleared were not goods, but, an immovable property and, therefore, the credit for input tax could not have been availed off. 2. It is on this point that the Tribunal has sustained the demand of the Revenue partially. The demand for duty and interest within limitation period has been sustained. However, bearing in mind the debatable legal issue of interpretation, the has Tribunal dropped the penalty. 3. Paragraphs 32, 33 and 34 of the impugned order, which areat page 150 of the paper book, read as under: "32 We find conside....