TaxTMI 
TaxTMI 
2025 (9) TMI 1084
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....amely, PP Wrapper Scrap, Packing Wood Scrap, MS Railing Pipe Scrap, Empty PVC Drum, MS Tin Tapper Scrap etc., without paying the central excise duty. The total duty not paid was calculated at Rs.39,65,081/- for the period 2016-17 and 2017-18 (up to June, 2017). The appellant considered the clearances as exempted sales, however department noticed that the Cenvat credit was not reversed in terms of Rules 6(3) of Cenvat Credit Rules, 2004. The appellant was alleged to be not entitled for availing the Cenvat credit amount of Rs.6,68,949/-. The availed credit of Rs.4,06,433/- on inputs namely, Grating, MS, Staircase without any corresponding document was also observed to have been wrongly availed by the appellant. Similarly, the service tax credit of Rs.5,53,325/- on input services as that of dismantling of plant and machinery, fabrication of steel structure, erection of steel structure, laying of GI sheet, dismantling of steel structures under Repairs & Maintenance Service was also alleged to be wrongly availed as all those activity fall under excluded category of Rule 2(l) of Cenvat Credit Rules, 2004 (the definition of Input Services). 1.2 Being dissatisfied from the reply of the ....
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....2019 (9) TMI 669 - CESTAT Ahmedabad (iii) SRF Ltd. Vs. CCE & ST, Alwar 2018 reported as 2018 (363) ELT 1058 (Tri.-Del) 3.1 It is further submitted that the demand is otherwise beyond the scope of allegations in the show cause notice. The show cause notice solely proposed the demand on account of contravention of Rule 3(5A) of Cenvat Credit Rules by the appellant. On the other hand, adjudicating authorities have confirmed the demand of excise duty for want of documents based whereupon the scrap of capital goods has been distinguished from the scrap otherwise. The demand of excise duty is liable to be set aside for this reason also. The burden was otherwise on the department to prove the allegations. Learned counsel has relied upon the following decisions: (i) Commissioner of C. Ex., Bhubaneswar-I Vs. Champdany Industries Ltd. reported as 2009 (241) ELT 481 (SC) (ii) Commissioner of Customs, Mumbai Vs. Toyo Engineering India Limited reported as 2006 (201) ELT 513 (SC) (iii) Commissioner of Customs Vs. Auto Ignition Ltd. reported as 2008 (226) ELT 14 (SC) (iv) CCE, Chandigarh Vs. Khalsa Charan Singh and Sons reported as 2010 (3) TMI 566 ....
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....e of machinery unlike it was the condition in Rule 3(5A)(a) of Cenvat Credit Rules, 2004. Otherwise also, the purchase bill and sale bill which are annexed along with the appeal do not show any co-relation between the goods purchased and sold. 4.1 It is further submitted that though the appellant defense is that they have already paid an amount of Rs.8,01,256/- towards clearance of waste and scrap of such capital goods on which they have taken Cenvat credit. However, the appellant had not produced any document with respect to the payment particulars nor any challans or reconciliation sheets. Hence, the defense has rightly been rejected by the adjudicating authorities below. It is finally submitted that extended period has rightly been invoked as the appellant has deliberately suppressed the material facts from the department with sole intent to evade the payment of duty. It is submitted that even if, the goods were fully or partially exempted, the appellants were still required to declare their whole clearance in the respective column of the periodical returns and then to claim the exemption thereon but the same was not done by the appellants. This fact came to the notice of dep....
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.... 1% (ii) for capital goods, other than computers and computer peripherals @2.5% for each quarter: Provided that if the amount so calculated is less than the amount equal to the duty leviable on transaction value, the amount to be paid shall be equal to the duty leviable on transaction value. (b) If the capital goods are cleared as waster and scrap, the manufacturer shall pay an amount equal to the duty leviable on transaction value. 5.3 Further examination of Rule 3(5A) of the Cenvat Credit Rules, 2004, reveals that clause (ii) requires the manufacturer has to pay an amount equal to the "duty leviable" on the transaction value of the scrap. The leviable duty is mentioned in the First Schedule to the Central Excise Tariff Act, 1985. There is no other statute in which the duty leviable can be found. Therefore, unless and until the item is specified in the Tariff, it is not possible to ascertain the "duty leviable" on the scrap. Apart from this, duty is leviable only when the item can be called as "excisable goods", and in order to be excisable goods, it is necessary that the same should be specified in the Tariff. Therefore, specification in the Tariff o....
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....of Commr. of C. Ex., Chandigarh Vs. Khalsa Charan Singh and Sons, 2010 (255) ELT 379 (P&H), wherein it was held that the burden of proof, on which deemed modvat credit is claimed are duty paid, was on Revenue and not on assessee. Hon'ble Apex Court also in the case of Commr. of Customs Vs. Auto Ignition Ltd. reported as 2008 (226) ELT 14 (SC) had already approved the view that the onus of proof on availment of credit of duty paid character, is on the Revenue and not on the assessee. The law laid down in these decisions is applicable to the present issue as well. Above all Rule 3(5A) of Cenvat Credit Rules should have been read along with the entire Rule 3 which enables availment of Cenvat credit on inputs/capital goods/input services. The entire Rule 3 is in regard to availment of Cenvat credit and therefore, sub-rules therein should only be read in conjunction, rather than in isolation with the main Rule. We draw our support to the department's own Circular No. 267141/2009-Cx.8 dated 07.12.2009 which clarifies that Rule 3(5A) is applicable in respect of those capital goods on which Cenvat credit has been taken and waste/scrap has been cleared after a period of 10 years. 7....
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....t services. The entire Rule 3 is in regard to availment of Cenvat credit and therefore, sub-rules therein should only be read in conjunction, rather than in isolation with the main Rule. We draw our support to the department's own Circular No. 267141/2009-Cx.8 dated 07.12.2009 which clarifies that Rule 3(5A) is applicable in respect of those capital goods on which Cenvat credit has been taken and waste/scrap has been cleared after a period of 10 years. 7.3.3 The sale of capital goods as waste in the impugned show cause notice is with respect to those capital goods on which the appellant had not availed the Cenvat credit. The confirmation of demand is therefore not sustainable. We draw our support from the decision relied upon by the appellant including the decision in the case of SRF Ltd. Vs. Commissioner of C. Ex. & Service Tax, Alwar reported as 2018 (363) ELT 1058 (Tr.-Del.). The issue under discussion was otherwise being already decided in appellant's own case by this Tribunal, Chennai Bench, vide Final Order No. 40505/2024 dated 30.04.2024." 5.7 Once it is appellant's defence since beginning that the appellant has not availed Cenvat credit in respect of the so clea....