TaxTMI 
TaxTMI 
2025 (11) TMI 854
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....an No.47 dated 13/05/2015 and debited vide Entry No.105 dated 10-062015 by the party. 3. I order for recovery of interest, at the applicable rates, on the aforesaid sums to be recovered under Rule 14 of the said Cenvat Credit Rules, 2004 read with Section 11AA of the Central Excise Act, 1944 from the party. 4. I impose penalty of Rs.35,74,487/- (Rupees Thirty Five Lakh Seventy Four Thousand Four Hundred and Eighty Seven) only under Rule 15(1) of the CENVAT Credit Rules, 2004 read with Section 11AC of the Central Excise Act, 1944. 2.1 Appellant is having Central Excise Registration No. AAFCS4898EXM001. A Show Cause Notice dated 16.11.2018 was issued to the Appellant for demand and recovery of Rs.35,74,487/- alleged to have been wrongly taken credit of duty involved on the following counts:- (i) that they availed and utilized CENVAT Credit to the tune Rs. 19,65,034/- of amount paid towards Customs Education Cess and Customs Secondary & Higher Education Cess during the year 2012-13 to 2014-15, which were not permissible in terms of Rules 3(1) of the Cenvat Credit Rules, 2004. (ii) that they availed inadmissible credit amounting to Rs. 5,43,7....
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....t shall be granted more than three times to a party during hearing of the appeal." RULE 20 of CESTAT Procedure Rules, 1982 provide as follows:- Action on appeal for appellant's default. - Where on the day fixed for the hearing of the appeal or on any other day to which such hearing may be adjourned, the appellant does not appear when the appeal is called on for hearing, the Tribunal may, in its discretion, either dismiss the appeal for default or hear and decide it on merits : Provided that where an appeal has been dismissed for default and the appellant appears afterwards and satisfies the Tribunal that there was sufficient cause for his nonappearance when the appeal was called on for hearing, the Tribunal shall make an order setting aside the dismissal and restore the appeal." 3.2 As the matter has been adjourned for more than the requisite number as prescribed by the Central Excise Act we are not inclined to adjourn this matter any further more so ever when neither written request or verbal communication has been received seeking adjournment with specific reason. In terms of Rule 20 of the CESTAT Procedure Rules, 1982 matter has been taken up for co....
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....ove referred rule (i.e. sub rule (1) of Rule 3} and it does not lie in the event of payment of Cess under a different law, i.e. the Customs Tariff Act and/or the Finance Act, 2004. Therefore, it flows from the law as envisaged under sub rule (1) of Rule 3 of the CCR that the credit of Education Cess and the Higher Education Cess having been paid as part of Customs duty was not available for taking credit. Thus, the credit of both Education Cess and the Higher Education Cess paid under the authority of Section 91 read with Sec.94 as well as Section 140 read with Section 138 (respectively) of the Finance Act, 2004 was wrongly availed and deserves to demanded and recovered from the party. 6.2 As regards admissibility of Cenvat credit in respect of duty paid on capital goods imported under EPCG, I find that the capital goods namely Vaccume Metallizer and Flat Die Co-extrusion Line were imported by the appellant duty free under EPCG scheme, however, they failed to discharge their export obligation. The appellant had taken credit on the basis of challan under which duty demanded by DGFT was deposited. Therefore, the duty was not in the normal course of circumstances at the time ....
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....nt failed to fulfill the export obligation i.e. 5 times the CIF value imported under the EPCG license. As the Appellant did not fulfill the requirement of the license, DGFT directed the Appellant to pay the due Customs Duty vide letter dated 15.10.2014 the entire credit. It is also worth noting that the capital goods against which credit was being sought have been destroyed in fire accident in the year 27.09.2010. It is quite evident that even before the date when the fire accident took placed the period prescribed as per EPCG license has been completed. The Appellant have not fulfilled the export obligation in term of Rule 4(2)(b) of the CENVAT Credit Rules. 4.5 Subsequent to the payment of duty as directed by the DGFT in terms of the license issued, Appellant have taken this credit. We do not find any merits in the grounds taken by the Appellant for the reason that the Appellant had not fulfilled the obligations caused on him under EPCG Scheme and have evidently mis-utilized the facility granted. In case of Servo Packaging Ltd.[2020 (373) ELT 550 (T-Chennai)] Chennai bench has observed as follows: "9.1 Advance Authorization is issued in terms of paragraph 4.03 of the ....
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....ne under Advance Authorization may vary because of the nature of import." 4.6 Further, on the date of taking credit, Appellant was not in possession of any of these machines. However we also find that period for fulfillment of the export obligation in the present case was over much before the destruction of the machines in the fire accident as claimed by the appellant. Appellant have at no stage of proceedings even produced the copy of installation certificate in respect of these capital goods imported under EPCG scheme in their premises. In similar sets of facts in case of Tirupati Structural Ltd. [FINAL ORDER NO.70557/2025 dated 08 August, 2025 in Excise Appeal No.70135 of 2022 ] Allahabad Bench has observed as follows: "4.7 I find that appellant was well aware long back even prior to introduction of GST w.e.f. 1st July, 2017 that they had and were not in position to fulfill the export obligation. In fact appellant have not even produced the installation certificate as require under the EPCG scheme evidencing the installation of the said capital goods in their premises at any time during the entire proceedings. Both the authorities have found that these capital goods ....
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....sed in courts of law and of equity, and, indeed, admits of illustration from every branch of legal procedure." The reasonableness of the rule being manifest, we proceed at once to show its application by reference to decided cases. It was noted therein that a man shall not take advantage of his own wrong to gain the favourable interpretation of the law. In support thereof, the author has placed reliance on another maxim frustra legis auxilium invocat quaerit qui in legem committit. He relies on Perry v. Fitzhowe [(1846) 8 QB 757 : 15 LJ QB 239] . At p. 192, it is stated that if a man be bound to appear on a certain day, and before that day the obligee puts him in prison, the bond is void. At p. 193, it is stated that "it is moreover a sound principle that he who prevents a thing from being done shall not avail himself of the non-performance he has occasioned". At p. 195, it is further stated that "a wrong doer ought not to be permitted to make a profit out of his own wrong". At p. 199 it is observed that "the rule applies to the extent of undoing the advantage gained where that can be done and not to the extent of taking away a right previously possessed". 19. It ....