TaxTMI 
TaxTMI 
2025 (10) TMI 449
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....d claim for Rs.- 5,61,33,288/- in respect of the amount of differential duty and interest thereon paid by them in respect of clearances of Intravenous Fluids (hereinafter referred as IV. fluids) cleared by them during the period from March, 2011 to July, 2012. They in their refund application stated as under,- "1.3 Under Notification No. 01/11-CE dated 01.03.2011, specified goods are partially exempt from duty, provided that no credit of duty on inputs has been taken in respect of manufacture of such goods. I.V. fluids manufactured by them are a specified item at SL. No. 38 of the Table annexed to the notification. Plastic granules are used as an input during the course of manufacture waste and scrap of plastic is generated. While no cenvat was taken in respect of the inputs, when the said waste and scrap was cleared from the factory on payment of duty, they availed the credit of duty suffered on plastic contained in the said waste and scrap, with the understanding of 'waste and scrap' as final product incidentally Boards Circular has also subscribed to that fact. 1.4 This practice was objected by the Central Excise officers with their understanding that f....
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....he objection raised by the Department the appellant paid differential duty of Rs. 48,97,7534/- under Section 11A(1)(b)(i) of Central Excise Act, 1944 from RG -23 part-ll and Rs. 77,55,754/- as interest under Section 11AB/11AA by e-payment. 2. On receipt of refund of amount stated at 1.3 and 1.4 above, we undertake to reverse the corresponding CENVAT Credit of Rs 4,22,48,555.00 3. We claim interest on the amount at 1.3 and 1.4 above as per provisions under Sec. 11AA of the Central Excise Act, 1944." 2.3 After hearing the appellant, and upon considerations of the submissions made by the appellant in the refund claim and subsequent correspondences made, the adjudicating authority rejected the refund claim vide order in original referred in para 1 above. 2.4 Aggrieved appellant filed appeal before the Commissioner (Appeal), which has been dismissed as per the impugned order. 2.5 Hence this appeal. 3.1 We have heard Shri Atul Gupta, Advocate for the appellant and Shri Santosh Kumar, Authorized Representative for the revenue. 3.2 Arguing for the appellant learned counsel submits: • The issue regarding availment of CENVAT credit attributable t....
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....n the appeal and during the course of arguments. 4.2 Impugned order records the findings as follows: "3-1 I have carefully gone through the facts and records of the case as well as the submissions made by the appellant during the personal hearing. Issue involved in this case is that the appellant was availing exemption under Notification No. 01/2011-CE dated 01.03.2011 on I.V. fluids wherein concessional rate of 1% (up to 16.03.12)/ 2% duty is leviable, provided no credit of duty on inputs or tax on input services used in the manufacture of the said goods has been taken. In the light of the above, it has to be decided, whether the appellant has fulfilled the conditions of the Notification No. 01/2011-CE dated 01.03.2011 or not? and whether the appellant is eligible for the refund claimed by them or not? 3-2 The appellant had filed a refund claim of Duty for Rs-4,89,77,534.00 paid as differential duty on l.V .fluids and Interest of Rs-71,55,754.00, which has been rejected by the Assistant Commissioner Central Excise division V Ghaziabad vide OIO 271/13-14 dt-15/02/2014. 3-3 The Notification No. 01/2011-CE dated 01.03.2011 reads as "In exercise ....
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....at "cenvat had been availed on the inputs as the differential duty payment was insisted by the Department by assuming hat Notification no.01/2011-CE ated 01/03/2011 is not applicable. When the appellant himself has accepted that they have availed cenvat on input and Service Tax and they will reverse the credit amount after receiving of refund amounts how can it be said that the appellant has not availed Cenvat of Duty and Tax. From the above it is quite clear that the appellant has not fulfilled the condition laid down in Notification No.01/2011-CE Dt.01/03/2011. 3-6 Intravenous fluids is specified at the serial number 38 of the Notification 01/2011 Dt 01-03-2011. As per the condition of the said Notification, concessional rate of duty will be applicable to those Manufacturers who have not availed cenvat on input or input service used in the manufacture of final goods. The appellant has availed cenvat on inputs and service tax used in manufacture of I.V. fluids. The appellant has reversed cenvat taken on quantity of LDPE only present the waste and scrap of plastic' cleared on payment on duty from Feb- 2011to July 2012 amounting to Rs-52,17379. Therefore they have made ....
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....e of Commissioner of C.Ex. Allahabad vs Balrampur Chini Mills Ltd Final Order No. A/56899-56904/2013-SM(BR) dt.0/7/2013 where the CESTAT ruled that "Cenvat was availed but not utilized. Interest not chargeable as the Cenvat not utilized, penalty not imposed since there is no malafide intention" The facts of the instant case are different from that of the case discussed above, and therefore the same principal can't be applied in this case." 4.3 The undisputed fact of the case is that the appellant was clearing I.V. Fluids, on payment of the duty, during the period for which they filed this refund claim and were taking the CENVAT credit of the inputs and input services. As they had availed the CENVAT Credit on the inputs and input and input services, they were not entitled to lower rate of duty (@ 1%) as per notification No 1/2011 dated 01.03.2011 (S No 38) in terms of the proviso to the notification. Appellant had paid differential duty of Rs 4,89,77,534/- and have correspondingly availed CENVAT credit of Rs 4,22,48,555/-. They had also paid interest of Rs 77,55,754/-. 4.4 The decision of the Hon'ble Allahabad High Court in the appellant own case as reported at [2013 (297)....
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....ayment of duty. It could not be disputed by the learned counsel for the department that the waste of plastic is liable to duty at 16 per cent under Tariff Entry No. 39.15 of the First Schedule of the Central Excise Tariff Act. The appellant submitted that on clearance of waste and scrap of plastic, duty @ 16 per cent has been paid under the aforesaid Tariff Heading No. 39.15." 4.5 The appeal filed by the revenue against this order of High Court has been dismissed by the Hon'ble Supreme Court as reported at [2015 (317) ELT A154 (SC)]. As the present dispute is for the period during which the CENVAT Credit Rules, 2004 were in force and the appellant was operating in terms of the said rules, this decision would not be a binding precedent. Further the decision of tribunal in the appellant own case, reported at [2015-TIOL-1248-CESTAT-Del], also do not considers the issue in situation where the both I V Fluids and the waste and scrap attracted duty. I V fluid attracted duty at @ 1 % in case where the input and input service credit has not be taken. In this case also the demand of the CENVAT credit, on the waste and scrap of plastic granules has ben set aside following the earlier deci....
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.... fails before the original authority and keeps quiet. It may also be a case where he files an appeal, the appeal goes against him and he keeps quiet. It may also be a case where he files a second appeal/revision, fails and then keeps quiet. The orders in any of the situations have become final against him. Then what happens is that after an year, five years, ten years, twenty years or even much later, a decision is rendered by a High Court or the Supreme Court in the case of another person holding that duty was not payable or was payable at a lesser rate in such a case. (We must reiterate and emphasise that while dealing with this situation we are keeping out the situation where the provision under which the duty is levied is declared unconstitutional by a court; that is a separate category and the discussion in this paragraph does not include that situation. In other words, we are dealing with a case where the duty was paid on account of mis-construction, mis-application or wrong interpretation of a provision of law, rule, notification or regulation, as the case may be.) Is it open to the manufacturer to say that the decision of a High Court or the Supreme Court, as the ease may b....
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....ecause another manufacturer or assessee has obtained a decision favourable to him. What has indeed been happening all these years is that just because one or a few of the assessees succeed in having their interpretation or contention accepted by a High Court or the Supreme Court, all the manufacturers/Assessees all over the country are filing refund claims within three years of such decision, irrespective of the fact that they may have paid the duty, say thirty years back, under similar provisions - and their claims are being allowed by courts. All this is said to be flowing from Article 265 which basis, as we have explained hereinbefore, is totally unsustainable for the reason that the Central Excise Act and the Rules made thereunder including Section 11B/Rule 11 too constitute "law" within the meaning of Article 265 and that in the face of the said provisions - which are exclusive in their nature - no claim for refund is maintainable except under and in accordance therewith. The second basic concept of law which is violated by permitting the above situation is the sanctity of the provisions of the Central Excises and Salt Act itself. The Act provides for levy, assessment, recover....
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.... years later another view of law is taken by another court in another person's case. Nor is there any provision in the Act for re-opening the concluded proceedings on the aforesaid basis. We must reiterate that the provisions of the Central Excise Act also constitute "law" within the meaning of Article 265 and any collection or retention of tax in accordance or pursuant to the said provisions is collection or retention under "the authority of law" within the meaning of the said article. In short, no claim for refund is permissible except under and in accordance with Rule 11 and Section 11B. An order or decree of a court does not become ineffective or unenforceable simply because at a later point of time, a different view of law is taken. If this theory is applied universally, it will lead to unimaginable chaos. It is, however, suggested that this result follows only in tax matters because of Article 265. The explanation offered is untenable as demonstrated hereinbefore. As a matter of fact, the situation today is chaotic because of the principles supposedly emerging from Kanhaiyalal and other decisions following it. Every decision of this Court and of the High Courts on a ....
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....late Tribunal or any Court, the limitation of one year shall be computed from the date of such judgment, decree, order or direction. It is provided in Section 27(1B)(c) that where any duty is paid provisionally under Section 18, the limitation of one year shall be computed from the date of adjustment of duty after the final assessment thereof or in the case of re-assessment, from the date of such re-assessment. The second proviso to Section 27 makes it clear that limitation of 1 year shall not apply where any duty or interest has been paid under protest. 37. Under Section 27(2)(a) it is incumbent upon the applicant to satisfy that the amount of duty or interest of which refund has been claimed, had not been passed by him to any other person, the provision aims at preventing unjust enrichment. 38. No doubt about it that the expression which was earlier used in Section 27(1)(i) that "in pursuance of an order of assessment" has been deleted from the amended provision of Section 27 due to introduction of provision as to self-assessment. However, as self-assessment is nonetheless an order of assessment, no difference is made by deletion of aforesaid expression as no se....
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....rder is not liable to be questioned and the matter is not to be reopened in a proceeding for the refund which, if we may term it so, is in the nature of execution of a decree/order. In the case at hand, it was specifically mentioned in the order of the Assistant Collector that the assessee may file an appeal against the order before the Collector (Appeals) if so advised." (emphasis supplied) 40. In Priya Blue Industries Ltd. v. Commissioner of Customs (Preventive) - 2004 (172) E.L.T. 145 (S.C.) = (2005) 10 SCC 433, the Court considered unamended provision of Section 27 of the Customs Act and a similar submission was raised which was rejected by this Court observing that so long as the order of assessment stands, the duty would be payable as per that order of assessment. This Court has observed thus : "6. We are unable to accept this submission. Just such a contention has been negatived by this Court in Flock (India) case (2000) 6 SCC 650. Once an order of assessment is passed the duty would be payable as per that order. Unless that order of assessment has been reviewed under Section 28 and/or modified in an appeal, that order stands. So long as the order of ass....
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....resented within a further period of thirty days.] [(1A) The Commissioner (Appeals) may, if sufficient cause is shown, at any stage of hearing of an appeal, grant time, from time to time, to the parties or any of them and adjourn the hearing of the appeal for reasons to be recorded in writing : Provided that no such adjournment shall be granted more than three times to a party during hearing of the appeal.] (2) Every appeal under this section shall be in such form and shall be verified in such manner as may be specified by rules made in this behalf." 43. As the order of self-assessment is nonetheless an assessment order passed under the Act, obviously it would be appealable by any person aggrieved thereby. The expression 'Any person' is of wider amplitude. The revenue, as well as assessee, can also prefer an appeal aggrieved by an order of assessment. It is not only the order of re-assessment which is appealable but the provisions of Section 128 make appealable any decision or order under the Act including that of self-assessment. The order of self-assessment is an order of assessment as per Section 2(2), as such, it is appealable in case ....
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....and post-amendment under Finance Act, 2011, we are of the opinion that the claim for refund cannot be entertained unless the order of assessment or self-assessment is modified in accordance with law by taking recourse to the appropriate proceedings and it would not be within the ken of Section 27 to set aside the order of self-assessment and reassess the duty for making refund; and in case any person is aggrieved by any order which would include self-assessment, he has to get the order modified under Section 128 or under other relevant provisions of the Act." 4.8 In respect of the applicability of the above decisions of the Hon'ble Supreme Court, Counsel for the appellant submitted a note stating as follows: • Decision in the case of ITC Limited has no application to refund arising in the Central Excise Case, as has been held by the larger bench in the acse of Shree balaji Warehouse [2023-VIL-981-CESTAT-CHD-ST] • Depatment cannot make out a new case at the stage of Tribunal, as the reasoning of the ITC decision has not been made the basis for rejection of the refund claim. Reliance is placed on the decision in the following cases: • ....
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....ppellants availed exemption under Notification No. 67/95-C.E., dated March 16, 1995 as to the duty in respect of waste paper/fresh broke. By Notification No. 6/2000-C.E., dated March 1, 2000 complete exemption was granted in respect of paper up to the specified quantitative limit manufactured from unconventional raw materials. Upon receipt of a letter dated March 30, 2001 from the Superintendent of Central Excise, the Appellant examined the matter and realized the mistake committed by it in availing the exemption under Notification No. 67/95-C.E. in respect of waste paper/broke utilized in the manufacture of paper cleared at 'nil' rate of duty under Notification No. 6/2000-C.E. From May 2001 onwards, the appellant stopped availing the exemption and started payment of duty on waste paper/broke. 9. The relevant period involved in the appeal i.e. July 2001 to March 2002. The Appellant's assessments for this period were provisional and these entries were finalized on 30-1-2003. The provisional assessment order was passed on 1-3-2002. The appellant has claimed that at the time of the said final assessment order dated 30-1-2003, it was not aware of the Notification No. 1....