Cce, Ludhiana vs M/S Abhishek Industries Limited

1 Whether Press Reporter may be allowed to see the Order for publication as per Rule 26 of the CESTAT (Procedure) Rules, 1982?

2 Whether it should be released under Rule 26 of CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?

3 Whether their Lordships wish to see the fair copy of the Order?

4 Whether Order is to be circulated to the Departmental authorities?

Excise Appeal No. 2093 of 2006

(Arising out of order in appeal No. 241/CE/CHD/2006 dated 30.03.2006 passed by Commissioner (Appeals), Central Excise, Chandigarh).

CCE, Ludhiana Appellant

Vs.

M/s Abhishek Industries Limited Respondent

Appearance:

Shri Ranjan Khanna, DR for the Revenue

Shri Rahul Tangri, Advocate for the Respondent

Coram: Honble Mr. Ashok Jindal, Member (Judicial)

Honble Mr. B. Ravichandran, Member (Technical)

Final Order No. 52134/ 2015

Per: Ashok Jindal:

The Revenue is in appeal against the impugned order on the ground that as per Rule 3(7)(b) of the Cenvat Credit Rules, 2004 the respondent were not entitled to utilise the cenvat credit of Additional Duties of Excise (textile and textile articles) for payment of excise duty. Therefore, the ld. Commissioner (Appeals) fell in error allowing the same to the respondent.

2. Heard the parties and considered the submissions.

3. In this case, initially the respondent was manufacturing cotton yarn and man-made yarn. By Notification No. 30/2004-CE, their final product became exempt, therefore, under wrong impression reverse cenvat credit on inputs or finished goods which was not required to be reversed. Therefore, they utilise cenvat credit of additional duty of excise (textile and textile articles) for reversal of cenvat credit for packing material. In fact, during that period, respondent was not required to reverse the credit, therefore, question of utilisation of additional duty of excise (textile and textile articles) does not arise. Therefore, the Commissioner (Appeals) has rightly observed as under:

I observe that the issue before me is to decide as to whether credit availed and utilised during the period when final product was dutiable is to be reversed when subsequently final product is cleared at zero rate of duty and also whether such reversal on account of Basic Excise duty and Edu. Cess can be made by utilizing the credit of AED(TTA). I find that the Cenvat Credit was availed and utilised during the period when the goods were leviable to duty which were cleared subsequently at zero rate of duty by virtue of exemption Notification No.30/2004-CE dt.9.7.2004. I consider that reversal of cenvat on the inputs contained in the goods cleared at zero rate of duty is not required in view of the decision of CESTAT in final order No. 867/2005 dt.2.6.05 (2005-TIOL-962-CESTAT-Bangalore) in CCE Visakhapatnam vs. Venkata Balaji Jute Mills and the judgment of the Honble Supreme Court in the case of CCE, Pune vs. Dai Ichi Karkaria Ltd.  1999 (112) ELT 353 (SC). Moreover the issue of Cenvat reversal of Basic Excise Duty from AED (TTA) has already been decided vide O-I-A No. 603/CE/Appeal/Ldh./04 dt. 31.8.04 in the case of M/s Abhishek Industries Ltd. Terry Towel Division, Barnala.

4. We do agree with the observation of the learned Commissioner (Appeals) that when respondent was not required to reverse the cenvat credit on packing material at the time their final product became exempt, therefore, utilized additional duty of excise (T&T) for payment of duty does not arise.

5. In these circumstances, we do not find any infirmity in the impugned order and merit in the appeal filed by the Revenue. Therefore, we dismiss the appeal.

(Ashok Jindal)

Member (Judicial)

(B. Ravichandran)

Member (Technical)

Pant