Commissioner Of Central Excise, ... vs M/S.Kothari Products Ltd

Appeal No.Ex.Ap.259/08 (Arising out of Order-in-Original No.01/COMMR/ADJ/CE/DIB/08 dated 30.01.2008 passed by the Commissioner of Central Excise, Dibrugarh.)

FOR APPROVAL AND SIGNATURE

HONBLE DR. D.M. MISRA, MEMBER(JUDICIAL) HONBLE DR. I.P. LAL, MEMBER(TECHNICAL)

1. Whether Press Reporters may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?

2. Whether it should be released under Rule 27 of the CESTAT(Procedure) Rules, 1982 for publication in any Authorative report or not?

3. Whether Their Lordship wishes to see the fair copy of the Order?

4. Whether Order is to be circulated to the Departmental Authorities?

Commissioner of Central Excise, Dibrugarh Applicant (s)/Appellant (s) Vs.

M/s.Kothari Products Ltd. Respondent (s)

Appearance:

Shri A.Roy, Supdt.(A.R.) for the Revenue

Shri Santosh Gupta & Vinod Sharma, Advocates for the Respondent (s)

CORAM:

Honble Dr. D.M. Misra, Member(Judicial) Honble Dr. I.P. Lal, Member(Technical)

Date of Hearing:- 17.03.2015 Date of Pronouncement :- 17.03.2015

ORDER NO.FO/A/75199/2015

Per Dr. D.M. Misra.

1. This is an Appeal filed by the Revenue against Order-in-Original No.01/COMMR/ADJ/CE/DIB/08 dated 30.01.2008.

2. Briefly stated the facts of the case are that the appellant are engaged in the manufacture of pan masala containing tobacco falling under tariff heading No.24039990 of CETA, 1985. During the relevant period i.e. 21.01.2004 to 08.07.2004 they had availed benefit of Notification No.08/2004-CE dated 21.01.2004 and 09.07.2004 onwards Notification No.28/04-CE dated 09.07.2004. Demand has been confirmed against them alleging violation of conditions these Notifications vide Order-in-Original dated 06.02.2007 and 30.03.2007. Aggrieved by the said order the assessee respondent herein filed appeals before this Tribunal. This Tribunal after considering their plea that there has been violation of principles of natural justice remanded the matter to the ld.Commissioner with a direction to pass a fresh order after providing adequate opportunity of hearing to the assessee respondent. Consequently, the present order is passed by the adjudicating authority.

3. In the order impugned the adjudicating authority, besides confirming the forfeiture of Rs.98,83,695/- and Rs.3,88,344.65 for irregular payment of duty in terms of Notification No.8/2004-CE as amended by Notification No.20/2004-CE dated 09.07.2004, allowed the respondent assessee to take CENVAT Credit (if any) back to their account which they had utilized at the time of clearance of their goods during the relevant period.

4. The Revenue aggrieved by the said order, to the extent of allowing the respondent-assessee to take CENVAT Credit(if any paid) in their account, filed the present appeal.

5. The ld.A.R. for the Revenue submits that the adjudicating authority has not recorded any finding on the eligibility of the CENVAT Credit before allowing the same to the Appellant. He submits that during the relevant period show cause notices were issued to the respondent-assessee for recovery of the CENVAT Credit which are pending adjudication. Therefore, the order of the ld.Commissioner is cryptic & unreasoned to the extent of allowing CENVAT Credit(if any) to the appellant, without due verification and adjudication of the pending show cause notices. It is the grievance of the Revenue that the ld.Commissioner has travelled beyond the scope of the remand order, inasmuch as such, an issue which was not before the Tribunal being not raised by the respondent-assessee in the first round of litigation, has been considered in the denovo adjudication.

6. The ld.Advocate for the respondent on the other hand submitted that after considering the facts on record and also the relevant demand notices, the Commissioner has passed the present order allowing CENVAT Credit paid by them. He submits that there cannot be double payment, therefore, the benefit allowed by the Commissioner cannot be questioned.

7. In his rejoinder the ld.A.R. for the Revenue submitted that in the event the ld.Commissioner had adjudicated the pending show cause notices, the same should have been reflected in the impugned order, either in the subject or in the body of the order. But, nowhere in the Order the show cause notices have been discussed. He submits that in any case the order is bad in law.

8. Heard both sides and perused the record. We find that in the earlier round of litigation this Tribunal has remanded the case to the adjudicating authority for deciding the issue afresh after observing the principles of natural justice. It is the grievance of the Revenue that while deciding the issue, the ld. Commissioner has travelled beyond the scope of the remand order and considered the submission of the respondent assessee about admissibility of CENVAT Credit availed without due verification of the facts, when show cause notices about eligibility of such CENVAT Credit are pending adjudication. We see there is some force in the argument of the Revenue. However, it is difficult to accept the contention of the Revenue that the ld.Commissioner cannot adjudicate the admissibility of CENVAT Credit or otherwise, while considering the forfeiture of all the irregular payment in ESCROW account or connected issues. On going through the impugned Order we could not that the ld.Commissioner has considered the pending show cause notices on recovery of CENVAT Credit and adjudicated the same along with the demand of Rs.98,83,695/- and Rs.3,88,344.65. Thus, in the interest of justice, it is necessary that the ld.Commissioner should take into consideration the pending show cause notices before allowing the CENVAT Credit to the respondent and record a detailed finding on this issue. In the result, the impugned order is set aside to the extent of allowing CENVAT Credit and the matter is remanded to the adjudicating authority to decide this issue afresh and record a detailed finding on admissibility of CENVAT Credit. Revenues Appeal is disposed off as above.

(Pronounced and dictated in the open court.)

SD/ SD/

(I.P.LAL) (D.M.MISRA) MEMBER(TECHNICAL) MEMBER(JUDICIAL) sm

5 Appeal No.Ex.Ap.259/08