TaxTMI 
TaxTMI 
2026 (7) TMI 719
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.... Coal imported by the appellants and therefore the appellants are not eligible for the Cenvat Credit of CVD paid as per Customs Notification. 4. Learned Counsel for the appellants submits that when one or more notifications are available for the appellants, the appellants are free to choose any of the notification which is beneficial to them. He also submits that there is no bar in the Cenvat Credit Rules, 2004 (CCR) to avail Cenvat Credit on the CVD paid by them on the import of Steam Coal and there is no restriction in the CCR making them dis-entitled to Cenvat Credit. He further submits that there are two other small issues involved in the case, wherein, penalty has been imposed on them even though they have paid duty/the Cenvat Credit availed along with interest before issuance of Show Cause Notice. 5. He also submits that as the ingredients for invocation of extended period are not specified and therefore, extended period cannot be invoked and consequently imposition of penalty is not justified. In respect of his submissions, he relies on the following cases: a. India Cements Vs Commr GST & CE [2026 (4) TMI 1227 (Tri-Chen)] b. Shyam Steel Vs CCGST & CX ....
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....able in terms of Rule 3 of CCR. Rule 3 describes that Cenvat Credit of rational duty leviable under Section 3 of Customs Tariff Act. Moreover, Cenvat Credit is admissible to the goods which are duty paid, which are brought into the factory of production which are used in the manufacture of excisable goods cleared on payment of duty and when the inputs are received in the factory under the cover of a document prescribed under Rule 9 of CCR. It is not the case of the Department that any of the conditions for availing Cenvat Credit are violated by the appellants. Therefore, we find that credit cannot be denied. We further find that similar issue has come before the Chennai Bench of the Tribunal for consideration in the case of the appellant themselves. CESTAT, Chennai Bench vide Final Order No. 40499/2026 dated 17.04.2026 held as follows: 8.1 The principal issue that arises for consideration in the present appeal is whether the appellant is entitled to avail CENVAT credit of Countervailing Duty (CVD) paid on imported steam coal at concessional rates of 1% / 2% under Notification No. 12/2012-Cus dated 17.03.2012, as amended by Notification No. 12/2013-Cus dated 01.03.2013, and....
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....es integra and stands covered by a catena of decisions relied upon by the appellant. In Seshasayee Paper and Boards Ltd. vs Commissioner of GST & Central Excise, Salem, 2026 (1) TMI 508 (CESTAT Chennai), the Tribunal, while dealing with an identical issue, held in Para 11 and 12 as follows: - "11. In view of the foregoing discussions and findings and respectfully following the binding judicial precedents as discussed hereinabove, we hold that the Appellant is entitled to avail CENVAT credit of 1% / 2% Additional Duty of Customs (CVD) paid on imported coal under Notification No. 12/2012-Cus dated 17.03.2012 and Notification No. 12/2013-Cus dated 01.03.2013. 12. As the core issue has been decided on merits in favour of the Appellant, we are of the considered view that there is no necessity to examine the remaining questions framed by us, namely, Issue Nos. 3 and 4, relating to the sustainability of the demand, interest and imposition of penalties. Consequently, the impugned Orders-in-Original, confirming the demand of CENVAT credit along with interest and imposing penalties, are set aside in toto." We find that the ratio decidendi of the above decision is t....
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....oncessional rate of duty does not alter the character of the levy for the purpose of CENVAT credit........ 6. The said view has been consistently followed by different Benches of this Tribunal. Since the legal issue involved in the present case is identical, we are inclined to follow these decisions referred supra and accordingly set aside the Order-in-Appeal." 8.7 Further, in Chettinad Cement Corporation Pvt. Ltd. Vs. Commissioner of GST & Central Excise, 2023 (11) TMI 57 (CESTAT Chennai): - "The Tribunal held that the embargo in Rule 3 of the Cenvat Credit Rules, 2004 operates only with reference to the Excise Notification and its specified serial entries and does not extend to restrictions contained in the Customs Notification granting concessional CVD on imported coal. The decision reasons that Excise Notification No.12/2012 applies to domestically manufactured coal and the condition denying CENVAT in that notification is therefore inapplicable to imports. Relying on earlier decisions (including SRF Ltd. and the Tribunal's decision in TNPL), the Tribunal concluded that denial of credit by invoking the Excise notification against a Customs notifica....
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....mitation, we find that the dispute in the instant case relates to pure interpretation of statute and the appellant has claimed CVD under the bona fide belief that they are entitled to avail the credit of CVD paid on the imported coal. Thus, it is evident that there was no intention to avail irregular credit on the part of the appellant. Therefore, we also hold that the extended period cannot be invoked in this case to disallow the credit. 10. In view of the above discussions, we set aside the impugned order and allow the appeal, with consequential relief, if any, as per law." 8.10 The consistent thread running through all the above decisions relied upon by the appellant is that CVD remains a duty under Section 3 of the Customs Tariff Act irrespective of the rate at which it is paid, and that eligibility to CENVAT credit depends on the nature of duty and actual duty amount paid. These decisions have also consistently held that notifications prescribing concessional rates do not curtail the statutory right to credit. 8.11 The Department, on the other hand, has relied upon TRU Letter dated 25.03.2011 and CBEC Circular No. 41/2013-Cus to contend that concessi....