Hindustan Photo Films Mfg. Co. Ltd vs Commissioner Of Central Excise

[Arising out of Order-in-Appeal No.337/2004-CE (SLM) dated 17.8.2004 passed by the Commissioner of Central Excise (Appeals), Salem]

Hindustan Photo Films Mfg. Co. Ltd. Appellant

Versus

Commissioner of Central Excise, Salem Respondent

Appearance:

Shri P.C. Anand, Chartered Accountant For the Appellant Shri M. Rammohan Rao, DC (AR) For the Respondent

CORAM:

Honble Shri R. Periasami, Technical Member

Date of hearing/decision :17.3.2015

FINAL ORDER No.40525/2015

The short issue in this appeal relates to denial of cenvat credit availed by the appellant of CVD paid on Jumbo Rolls of Cinematographic Film purchased from Customs auction/sale on T.R.6 challan. The adjudicating authority in his order dt. 14.11.2003 disallowed the credit and ordered for reversal of credit on the grounds that TR-6 challan is not a specified document under Modvat/Cenvat Rules. The appellate authority upheld the order and rejected their appeal.

2. Heard both sides.

3. Ld. Consultant Shri P.C. Anand submits that they purchased 59 Jumbo Rolls of Cinematographic Film from Customs auction carried out by Kandla Customs and paid the amount through T.R.6 challan to the Customs Treasury. Since they are not original importers and only purchased the Rolls for Customs auction there is no B/E in their name. The sale amount deposited to the Customs by T.R. 6 challan is inclusive of CVD. The adjudicating authority denied cenvat credit and held that T.R.6 challan is not a valid document for availing the cenvat credit. They have also submitted the certificate issued by the Appraiser, Kandla Customs before the lower authorities but it was considered. The Notification No.16/94-CE (NT) dt. 30.3.94 specified the list of documents other than invoices for availing cenvat credit and Sl.No.10 & 11 of the above notification endorsed Gate Passes/Subsidiary GPs/Certificates. S.No.13 also permits subsidiary certificates issued by the Range Superintendent. Therefore, he pleaded that they have availed credit correctly. He relied on the following decisions :-

1) CCE Jaipur Vs Wire & Fabrics SA Ltd.

1999 (107) ELT 790 (Tribunal)

2) CCE Mumbai-II Vs Hindustan Composites Ltd.

2004 (175) ELT 404 (Tri.-Mumbai)

3) Gabriel India ltd. Vs CCE 1993 (67) ELT 131 (Tribunal)

3. Ld. A.R reiterates the finding of the impugned order. He relied on Chaudhary Industries Vs UOI - 2012 (281) ELT 216 (Guj.).

4. After hearing both sides, I find that the short issue that arises for consideration is whether CVD credit availed by the appellant on T.R.6 challan is a valid documents for availing the credit of CVD paid by the appellant on the Jumbo Rolls purchased through auction from Customs. The adjudicating authority has not disputed the payment of CVD on the said goods. The credit was denied only on the limited ground that T.R.6 challan is not a valid document. As rightly contended by appellant, Notification No.16/1994 (CE) clearly provides various documents and certificate issued by various agencies are treated as admissible documents for availing modvat credit under Rule 57G. It is pertinent to state that appellant being a PSU, Govt of India undertaking are engaged in the manufacture of photographic films and other photographic paper etc. During the relevant period, import of the jumbo rolls by an importer were absolutely confiscated by the Kandla Customs. Once confiscated, it becomes the property of Govt and the Customs authorities have to sell/dispose the same and appellant being the only PSU manufacturing photographic films, it has to be necessarily given to the appellants unit. There is no dispute on the sale and the purchase of entire cinematographic film and the appellants paid the amount as per the price arrived by the Customs which is inclusive of customs duty (CVD). As evident from the T.R.6 challan enclosed at page 26 of appeal paper, the appellant paid an amount of Rs.48,50,000/- which clearly shows that appellant had paid the amount towards purchase of above goods. There is also an endorsement on the TR-6 challan which reads as :

CVD paid @ Rs.24/- per sq. mtr. and total CVD is Rs.19,26,282.90". This is supported by a certificate duly issued by the AC of Customs, Kandla vide F.No.VIII/6(a)-5/89-appg. dt. 10.9.1990 and it is clearly certified that the price of the Jumbo rolls includes CVD duty leviable on the goods. In view of the above facts, appellant had paid duty through TR-6 challan which is duly supported by the certificate issued by Kandla Customs.

I rely Tribunals decision in the case of CCE Mumbai Vs Hindustan Corporation (supra) wherein the Tribunal held that TR.6 challan being primary document of evidence for payment of customs duty and the Revenues appeal was rejected. The relevant para 5 of the said decision is reproduced as under :-

"5. So far as the certificate of duty payment endorsed by the appraiser is concerned, in a situation where import duty is required to be paid on the material which was initially cleared without payment of duty, there is no other document that can vouch for the authenticity of the payment of duty on the goods so cleared except the certificate which the respondents produced. The list of duty paying documents as specified in the Rule 57G of the Rules may not specifically refer to duty payment affected subsequently to the clearance of the goods. However, the payment having been made on the basis of cash challan and duly certified by the concerned appraiser of the Customs House, it cannot cease to be a duty paying document. In fact, it is the most primary document of duty payment the acceptance of which cannot be disputed, when the secondary document generated from primary duty paying document (cash challan) such as invoices of the traders and the dealers and godown keepers are being accepted as duty paying document.

6. On?the basis of the above analysis, I find that the appeal filed by the Revenue is without any merit and the same is rejected".

In the present case, appellant has rightly availed credit based on T.R.6 challan which is duly certified by Kandla Customs. In view of above facts and relying on the above decisions, I hold that credit availed by the appellant on the T.R.6 challan which is duly supported by the Customs by a certificate is a valid document for availing credit. The case law relied by Revenue is not applicable to the present case as it pertained to sale of goods by the ship breaker. In the said case, it was held that vessel was not imported by auction purchaser who is not an importer and it was sold with condition that no customs duty was payable on it whereas in the present case it is purchase of imported goods for which duty has been validly paid. Therefore, the case law cited by Revenue is not applicable to this case, Accordingly, the impugned order is set aside and the appeal is allowed.

(Operative part of the order pronounced in open court on 17.3.2015)

(R. PERIASAMI) TECHNICAL MEMBER

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