TaxTMI 
TaxTMI 
2026 (9) TMI 1108
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....y available when paid as per Tariff rates or even in cases of concessional payments? D. Whether the credit of CVD would be available, when it is not paid equivalent to the excise duty leviable on the coal specified under clauses (i), (ii), (iii), (iv), (v), (vi), (vi) and (via) and applied clause (vii) of Rule 3 of Cenvat Credit Rules?" 3 As the questions raised in this appeal are in narrow compass, with the consent of the learned advocates for the respective parties, the same is taken up for hearing. 4 The facts in a nutshell can be summarized as under: 4.1 The respondent - assessee is engaged in the manufacturing of excisable goods viz. MS Billets, MS Billet End Cutting, MS Round Bars, Missed Rolled Bars and Sponge iron falling under Chapter 72071920, 72071990, 72141090, 72042190 and 72031000 of the Central Excise Tariff Act, 1985 (for short 'the Tariff Act, 1985'). 4.2 The assessee was also availing the Cenvat credit of duties paid on inputs and input services under Cenvat Credit Rules, 2004 (for short "the Rules"). An audit was conducted for the period from April 2014 to June 2017 and during the course of the audit by the department, it was revealed....
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.... Industries Ltd. Final Order No. A/10390/2019 dated 22.02.2019. 4.7 The Tribunal, therefore, held that the assessee was entitled to Cenvat credit in respect of 2% CVD paid under Notification No. 12/2012 -Cus by setting aside the Order - in - Original. 5. Learned Senior Standing Counsel Ms.Hetvi Sancheti for the appellant - revenue, submitted as under: 5.1 Referring to Rule 3(1)(vii) of the Rules, Ms. Sancheti, learned Senior Standing Counsel submitted that Rule 3(1)(vii) is a substantive eligibility condition which permits credit only of CVD "equivalent to the duty of excise specified under clauses (i) to (via) of Rule 3(1). Section 3(1) of the Customs Tariff Act, 1975 mandates that CVD "shall be equal to the excise duty for the time being leviable" on a like article manufactured in India. 5.2 It was further submitted that for the purpose of Section 3(1), the goods must be treated as though manufactured in India, and the excise duty that would then be payable must be ascertained having regard to the concessional notification actually applicable and the conditions attached thereto. In support of her submission, reliance was placed on the decision of the Hon'ble Supre....
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....ling duty if any notification is issued providing exemption/remission of Excise duty for a like article if produced/manufactured in India." 5.6 In view of the above decision, it was submitted by Ms. Sancheti, learned Senior standing Counsel that this principle would squarely apply to the present case and the respondent's entitlement to the concessional CVD rate must be tested against and is co-extensive with, the conditions attached to the corresponding domestic concession and cannot be claimed as an unconditional benefit divorced from those conditions. 5.7 Ms. Sancheti, learned Senior Standing Counsel, also referred to and relied upon a decision of this Court in the case of Lonsenkiri Chemicals Industries vs. CCE, Cus. & S.T., Vadodara -I, reported in 2019 (365) E.L.T 22 (Guj)., and submitted that the principle laid down therein, must be read consistently for the purpose of computing CVD and for the purpose of allowing Cenvat Credit on such CVD applies with equal force to the present case. 5.8 Learned Senior Standing Counsel Ms. Sancheti would further refer to the decision of the Hon'ble Supreme Court in the case of Union of India vs. Dharmendra Textile Processors....
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....esh Dave referred to the decision of the Hon'ble Calcutta High Court in the case of Commissioner of CGST & C.Exc, Bolpur Commissionerate vs. Shyam Steel Industries Ltd., reported in 2022 (382) E.L.T 329 (Cal.) to submit that in a slightly different facts before the Hon'ble Calcutta High Court, it was held that the decisions which were cited before the CESTAT were not reversed or modified by the High Court. It was pointed out by the learned advocate Mr. Dave that the CESTAT in case of Shyam Steel (supra), allowed the appeal of the assessee where there is no restriction in the Notification issued under the Central Excise Act being Notification No. 12 of 2012- Central Excise dated 17.03.2012 insofar as availment of the Cenvat credit on coal is concerned. CESTAT further held that credit of CVD is available under Rule 3(1) (vii) of the Rules and proviso to Rule 3(1)(i) restricting the credit in case of coal under Central Excise Notification No. 12 of 2012 dated 17.03.2012 cannot impliedly be read when the rate of CVD has not been followed from the excise notification but has generally applied rate. 6.2 It was submitted that coincidentally there were two separate notifications....
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....India shall, in addition, be liable to a duty (hereafter in this section referred to as the additional duty) equal to the excise duty for the time being leviable on a like article if produced or manufactured in India and if such excise duty on a like article is leviable at any percentage of its value, the additional duty to which the imported article shall be so liable shall be calculated at that percentage, of the value of the imported article. Explanation .- In this section, the expression "the excise duty for the time being leviable on a like article if produced or manufactured in India" means the excise duty for the time being in force which would be leviable on a like article if produced or manufactured in India or, if a like article is not so produced or manufactured, which would be leviable on the class or description of articles to which the imported article belongs, and where such duty is leviable at different rates, the highest duty." "Section 25(1) of the Customs Act, 1962 25. Power to grant exemption from duty. (1) If the Central Government is satisfied that it is necessary in the public interest so to do, it may, by notification in t....
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.... Schedule to the Customs Tariff Act;] (viia) the additional duty leviable under sub-section (5) of section 3 of the Customs Tariff Act; Provided that a [provider of output service] shall not be eligible to take credit of such additional duty;]" "Notification No. 12/2012-CUS dated 17.03.2012 (Relevant Extract) In exercise of the powers conferred by sub-section(1) of section 25 of the Customs Act, 1962 (52 of 1962) and in supersession of the notification of the Government of India in the Ministry of Finance (Department of Revenue) No. 21/2002-Customs, dated the 1 st March, 2002 published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (I), vide number G.S.R 118(E) dated the 1 st March, 2002, except as respects things done or omitted to be done before such supersession, the Central Government, being satisfied that it is necessary in the public interest so to do, hereby exempts the goods of the description specified in column(3) of the Table below or column (3) of the said Table read with the relevant List appended hereto, as the case may be, and falling within the Chapter, heading, sub-heading or tariff item of the First Sche....
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....nd effective rate of duty for specified goods of Chapters 25 to 49 :- In exercise of the powers conferred by sub-section (1) of section 5A of the Central Excise Act, 1944 (1 of 1944) and in supersession of (I) notification of the Government of India in the Ministry of Finance (Department of Revenue), No.3/2005- Central Excise, dated the 24th February, 2005, published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (I), vide number G.S.R 95(E), dated the 24th February, 2005, (ii) notification No. 3/2006-Central Excise, dated the 1st March, 2006, published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (I), vide number G.S.R 93(E), dated the 1st March, 2006, (iii) notification No. 4/2006-Central Excise, dated the 1 st March, 2006, published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (I), vide number G.S.R 94(E) dated the 1 st March, 2006, (iv) notification No. 5/2006 - Central Excise, dated the 1st March, 2006, published in the Gazette of India, Extraordinary Part II, Section 3, Sub-section (I), vide number G.S.R. 95(E) dated the 1st March, 2006, (v) Notification No. 6/2006- Central Excise, dated the 1st Ma....
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.... If no credit under rule 3 or rule 13 of the CENVAT Credit Rules, 2004, has been taken in respect of the inputs or input services used in the manufacture of these goods. 8. On perusal of the above provisions and the Notifications, it is clear that: 8.1 Section 3(1) of the Tariff Act, 1975, provides for levy of additional duty which would counter balance the excise duty leviable on any raw material, components and ingredients of the same nature as, or similar to those, used in the production or manufacture of such article, it may, by notification in the official gazette, direct that such imported article shall, in addition, be liable to additional duty representing such portion of the excise duty leviable on such raw material, components, ingredients as in either case may be determined by rules made by the Central Government in this behalf. 8.2 Thus, Section 3(1) of the Tariff Act, 1985, prescribes the additional duty which is commonly known as CVD i.e. Counter Vailing Duty so as to nullify create a level playing field for the local manufacturers and to see that the local manufacturers do not suffer the excise duty more than the customs duty payable under the provisions o....