G.M. M/S.Simbholi Sugar Mills vs Cce, Meerut-Ii
- CitationExcise Appeal No.E/84/2010-EX [SM]
Ratio decidendi
The rule this decision rests on
Where an assessee has reversed irregularly availed Cenvat credit and furnished the reversal particulars to the jurisdictional authority in its monthly returns, the Department is deemed to know the facts of the irregular credit from the date of filing those returns, and a show cause notice must be issued within one year of that date; a notice issued beyond that period is time-barred and the demand, interest and penalty founded on it cannot be sustained, without any examination of the merits.
Written by Miss Lucy from the judgment below, not taken from a headnote.
Judgment
As delivered
[Arising out of Order-in-Appeal No.253/CE/MRT-II/2009 dated 30.09.2009 passed by the Commissioner (Appeals), Customs, Central Excise and Service Tax, Meerut-II]
For approval and signature:
HONBLE MR. S.K. MOHANTY, MEMBER (JUDICIAL)
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 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?
G.M. M/s.Simbholi Sugar Mills Appellant
Vs.
CCE, Meerut-II Respondent
Present for the Appellant : Shri.Kapil Vaish, C.A.
Present for the Respondent: Shri.D. Singh, D.R.
Coram: HONBLE MR. S.K. MOHANTY, MEMBER (JUDICIAL)
Date of Hearing/Decision: 03.08.2015
FINAL ORDER NO. 54188/2015
PER: S.K. MOHANTY
Confirmation of interest on account of late payment of Central Excise Duty and imposition of penalty, are the subject matter of present dispute.
2. Shri Kapil Vaish, the ld. C.A. appearing for the appellant submitted that the appellant had reversed the amount equivalent to the duty on inputs, used in the manufacture of exempted goods, in the cenvat account during the period February 2003 to July, 2003. It is his submission that since the duty payment particulars were known to the Central Excise Department in the year 2003, the Show cause notice should have been issued within one year from the date of deposit. In the present case, since the show cause notice was issued on 23.05.2008, the same is barred by limitation of time. Thus, proceeding for recovery of interest and penalty are not sustainable.
3. On the other hand, Shri D. Singh, the ld. A.R. appearing for the respondent reiterated the findings recorded in the impugned order.
4. I find that the date of reversal by irregularly availed cenvat credit in the cenvat account on different dates have been communicated by the appellant to the jurisdictional authority. Since as per the statutory requirement, the reversal particulars were furnished in the monthly returns, the show cause notice was required to be issued within one year from the date of filing of such returns. As the show cause notice in this case has been issued in 2008, in my opinion, the same is barred by limitation of time, since the fact of taking irregular credit was known to the Department way-back in 2003. In view of above, the impugned order confirming the adjudged demand is liable to be set aside on the ground of limitation alone, without going into the merits of the case. Thus, the impugned order is set aside and the appeal is allowed in favour of the appellant.
[Operative part of the order pronounced in the Open Court]
(S.K. MOHANTY)
MEMBER (JUDICIAL)
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