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2023 (5) TMI 77
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....se duty and they were compulsorily to take exemption under the said notification therefore, the supplies made without availing exemption on payment of duty, on such duty Cenvat credit is not admissible to the appellant. 2. Shri PS Namboodiri learned Counsel along with Ms. Ruhi Jhota learned advocate appearing on behalf of the appellant submits that the Notification No. 44/2001-CE (NT) is the conditional notification and it is open to the supplier whether said exemption is to be availed or not. In the present case, the supplier of inputs without availing said notification, cleared the goods on payment of duty therefore, the appellant is correctly entitled for the Cenvat credit. He further submits that once the duty was paid by the supplier irrespective to the fact that the same is payable or not, recipient of the inputs cannot be denied Cenvat credit. The assessment of duty at the supplier end cannot be questioned at the recipient end for allowing Cenvat credit. He placed reliance on the following judgments:- (a) Oleofine Organics (India) Pvt. Limited - 2014 (299) ELT 91 (Tri.- Mum) (b) Balakrishna Industries Limited - 2014 (309) ELT 354 (Tri.- Del.) (c....
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....ufactured - (i) in a [free trade zone [or a special economic zone]] and brought to any other place in India; or (ii) by a hundred per cent export-oriented undertaking and [brought to any place in India]. Explanation. - In this proviso, ["free trade zone", ["special economic zone"]] and "hundred per cent export-oriented undertaking" shall have the same meanings as in Explanation 2 to sub-section (1) of section 3. [(1A) For the removal of doubts, it is hereby declared that where an exemption under sub-section (1) in respect of any excisable goods from the whole of the duty of excise leviable thereon has been granted absolutely, the manufacturer of such excisable goods shall not pay the duty of excise on such goods.] ...................... ....................... .........................." From the plain reading of Section 5A, sub section (1A) it is clear that only compulsion on the assessee is to avail exemption which is absolute and the said compulsion is not applicable in respect of conditional notification. In the present case, Notification No. 44/2001-CE (NT) being a condition....
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....001-C.E. (N.T.), dated 26-6-2001, no duty would have been paid by the suppliers and appellants would also have not got any credit. We also note that in the impugned order, Tribunal judgment in the case of M/s. Reliance Industries Ltd. reported in 2009 (244) E.L.T. 254 (Tri.-Ahd.) have been cited with lot of force. We have gone through the said judgment and we find that the issue involved in the said judgment was different and are not relevant to the facts of the present case. In fact, in the case of M/s. Reliance Industries Ltd., duty was being paid by the supplier and no objection was raised by the Department. Objection raised was relating to valuation of supplies made. We also find the issue is exactly the same as decided by the Tribunal in the case of Shakun Polymers Ltd. v. CCE reported in 2009 (241) E.L.T. 250 (Tri.-Ahd.). We do not find any reason not to follow the same. 6. In view of the above , we allow both the appeals." The above decision of the Tribunal has been upheld by the Hon'ble Bombay High Court which is reported as Commissioner vs. Oleofine Organics (India) Pvt. Limited - 2015 (319) ELT A192 (Bom.) wherein the following observation was made by Ho....
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....Excise Law or Rules requiring necessarily to clear goods under Notification No. 44/2001-CE (NT) covering clearance against Advance licence/Authorisation by receiver and supplier of goods disregarding entitlement. Overall, no loss of revenue as credit taken of duty paid by supplier. Credit allowable following decision on similar issue. (b) Similarly in the case of Balakrishna Industries Limited (supra), while dealing with the same issue, the Tribunal has passed the following order:- "6. After appreciating the submissions made by both the sides, we find that the Tribunal in the case of Oleofine Organics (India) Pvt. Ltd. v. CCE, Thane-I reported in 2014 (299) E.L.T. 91 (Tri.-Mumbai) has dealt with the same issue and has observed as under :- "5. We have considered the submission of the both the sides. There is no dispute that appellants had taken invalidation letter/ARO. These documents were handed over to the suppliers who in turn would have taken the benefit available to them. These have not been cancelled or withdrawn by the appellants. However, it is also observed from the impugned orders itself that the suppliers have not availed the refund of terminal ....
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....f of the main noticee also relied on the order dated 5-4-2013 of the Mumbai Bench of the Hon'ble CESTAT in the case of Oleofine Organics (India) Pvt. Ltd. v. C.C.E., Thane. These orders have also been relied upon by some co-noticees. I have gone through this order and there is no doubt that the issue before the Hon'ble Tribunal was same as here. The thrust of the Hon'ble Tribunal was that there is nothing in Notification No. 44/2001 which requires the manufacturer to clear the goods without payment of duty only. It was also observed that there is revenue neutrality and no loss to the revenue. It is evident that the policy Circular No. 16 (RE-2012/2009-14), dated 15th March, 2013 which has been issued recently by the D.G.F.T. was not brought to the notice of the Hon'ble Tribunal. In fact, before the Hon'ble Tribunal, the case was not presented in its entire gamut but as a simple case of payment of duty where it was not required to be paid and availment of credit of this duty by the recipient of goods. Similarly, the learned Commissioner of Central Excise, Belapur who dropped the demand in the case of M/s. I.G. Petrochemicals in an identical matter, also did not have the benefit of c....
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.... Circular, the same relates to the refund of the terminal excise duty and is nowhere concerned about the availment of the Cenvat credit of duty paid on the inputs by the input supplier. As such, we find that the Commissioner reliance on the said Circular was not called for. 10. Apart from above, we also note that this is well settled law that a manufacturer is entitled to avail the credit of duty "paid" by the input manufacturer and the assessments at his end cannot be reopened on the ground that input supplier should not have paid duty in which case the credit of the same would be available to the manufacturer/exporter. Reference can be made to the decisions in the cases of :- (i) CCE & Cus. vs. MDS Switchgear Ltd. reported in 2008 (229) E.L.T. 485 (S.C.); (ii) CCE, Chennai-I vs. CEGAT, Chennai reported in 2006 (202) E.L.T. 753 (Mad.); (iii) MDS Switchgear Ltd. vs. CCE & Cus., Aurangabad reported in 2001 (132) E.L.T. 405 (Tri. - Mumbai); (iv) CCE, Goa vs. Nestle India Ltd. reported in 2012 (275) E.L.T. 49 (Bom.); (v) CCE, Delhi-III vs. Neel Metal Products Ltd. reported in 2009 (237) E.L.T. 270 (P & H); (vi) CCE & Cus. ....
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....urisdictional officers of the supplier's unit cannot be contested or challenged by the officers in-charge of the recipient unit and in this regard reliance is placed on the Apex Court judgment in the case of CCE & CUS v. MDS Switchgear Ltd. reported in 2008 (229) E.L.T. 485 (S.C.) and that in view of the above submissions, the impugned order is not correct. 5. Shri Pramod Kumar, learned Jt. CDR, defended the impugned order by reiterating the findings of the Commissioner. 6. We have considered the submissions from both the sides and perused the records. 7. The appellant had been issued Advance Authorization and since they did not use those Advance Authorization for duty free import of inputs, they got the same invalidated and obtained invalidation letters in favour of certain domestic suppliers for duty free supply of the inputs. However, domestic suppliers instead of supplying the inputs duty free in terms of Notification No. 44/2001-C.E. (N.T.), dated 26-6-2001 supplied those inputs on payment of duty. The appellant took Cenvat credit of that duty. The Department's contention is that the domestic suppliers in whose favour the invalidation letters had bee....