Cce, Chennai Iv vs M/S. Resico India P. Ltd
- Case No.Appeal No. E/336/2012
Ratio decidendi
The rule this decision rests on
The condition in sub-rule (3A) of Rule 8 of the Central Excise Rules, 2002, requiring an assessee to pay outstanding amounts including interest before duty may be discharged through CENVAT credit, has been declared unconstitutional by the Gujarat High Court in Indsur Global Ltd and Precision Fasteners Ltd, and that declaration binds the Tribunal as followed by the Madras High Court in A.R. Metallurgicals; consequently, no denial of duty discharge through CENVAT credit may be sustained on the strength of that condition, even for periods after 1.6.2006, and the Revenue's demand founded on it cannot survive.
Written by Miss Lucy from the judgment below, not taken from a headnote.
Judgment
As delivered
(Arising out of Order-in-Appeal No. 21/2012 (M-IV) dated 12.4.2012 passed by the Commissioner of Central Excise (Appeals), Chennai)
CCE, Chennai IV Appellant
Vs.
M/s. Resico India P. Ltd. Respondent
Appearance
Shri B. Balamurugan, AC (AR), for the Appellant Shri R. Parthasarathy, Consultant for the Respondent
CORAM
Honble Shri D.N. Panda, Judicial Member
Date of Hearing / Decision: 07.09.2015
Final Order No. 41108 / 2015
Honble High Court of Madras in the case of A.R. Metallurgicals P. Ltd. Vs. CESTAT, Chennai 2015 (322) ELT 49 (Mad.) has held that there cannot be denial of discharge of duty through CENVAT credit even after 1.6.2006. For convenience of reading para 4 of the said judgment is reproduced below:-
4. Since the issue raised in this civil miscellaneous appeal has already been decided by the Gujarat High Court in the judgments in Indsur Global Ltd. Vs. Union of India 2014 (310) ELT 838 (Guj.) and in Precision Fasteners Ltd. v. Commissioner of Central Excise, 2014-TIOL-2211-HC-AHM-CX = 2015 (316) ELT 595 (Guj.), declaring that the condition contained in sub rule (3A) of Rule 8 of the Central Excise Rules, 2002 for payment of duty without utilizing the CENVAT credit till an assessee pays the outstanding amount including interest is unconstitutional and that the subsequent proceedings initiated by the Department for demanding tax were set at naught, which were followed by us in a batch of writ petitions in W.P. Nos. 2506 of 2011, etc. dated 27.3.2015 (M/s. Malladi Drugs & Pharmaceuticals Ltd., Ranipet etc. etc. v. Union of India rep. by its Secretary, Ministry of Finance etc.) deciding the issue in favour of the assessees therein for the reasons stated therein, following the same, this civil miscellaneous appeal is allowed and the substantial questions of law are answered in favour of the assessee and against the Department. Consequently, M.P. No. 1 of 2011 is closed. No costs.
2. In view of the above, the Revenue appeal is dismissed.
(Dictated and pronounced in open court)
(D.N. Panda) Judicial Member
Rex
2
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