M/S. Balakrishna Industries Ltd vs C.C.E & S.T. Jaipur-I

[Arising out of Order-in-Appeal No. 111(MPM)CE/JPR-I/2006 dated 29.03.2006 by the Commissioner of Customs, Central Excise & Service Tax (Appeals), Jaipur].

For approval and signature:

Honble Shri Ashok Jindal, Member (Judicial)

Hon'ble Shri B. Ravichandran, 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 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?

M/s. Balakrishna Industries Ltd. .Appellants

Vs.

C.C.E & S.T. Jaipur-I .Respondent

Appearance:

Shri Rahul Tangri, CA for the Appellant

Shri Pramod Kumar, DR for the Respondent

CORAM:

Hon'ble Shri Ashok Jindal, Member (Judicial)

Hon'ble Shri B. Ravichandran, Member (Technical)

Date of Hearing: 21.08.2015

FINAL ORDER NO. 52751/2015-EX(DB)

Per Ashok Jindal:

The appellant is in appeal against the impugned order denying Cenvat Credit taken by them suo moto.

2. The facts of the case are that the appellant is manufacturer of Pneumatic Rubber Tyres as well as Tractor Rear Tyres. The appellant has exported Tractor Rear Tyres on payment of duty i.e. BED at the rate of 16% and SED at the rate of 8% and filed rebated claim. Rebate claim was sanctioned. Later on it was realized that they were not required to pay SED at the rate of 8% on the exported goods. Therefore, the amount of excess rebate claim sanctioned to the appellant on account of SED was demanded which appellant paid through PLA and took the credit on the same in their Cenvat Credit Account. Revenue objected to that on the ground that as appellant has not received any inputs / capital goods. Therefore, appellant is not entitled to take Cenvat Credit on the amount paid through PLA. In these circumstances, the show cause notice was issued to deny Cenvat Credit. Consequently, demand of duty was raised along with interest and proposal of penalty was also made. Matter was adjudicated. Demand of duty along with interest was confirmed. Penalty of Rs. 4 lakhs was also imposed. Aggrieved from the said order, appellant is before us.

3. The Ld. Counsel for the appellant submits that initially appellant paid SED by debiting Cenvat Credit account which was not payable by them and they got rebate claim of the same which was paid by them through PLA on reversing the same and excess rebate claim was allowed to them. Therefore, they have correctly taken the Cenvat Credit in their account on SED in the light of the decision of this Tribunal in the case of Hind Spinners Vs. CCE Bhopal-2005 (187) ELT 266 (Tri-Del) and in the case of Ramesh Enterprises Vs. CCE Coimbatore-2005 (191) ELT 604 (Tri-Chennai).

4. On the other hand Ld. AR supported the impugned order and submits that as they have paid excess rebate claim through PLA, therefore, appellant is not entitled to take Cenvat Credit as Cenvat Credit is available only on the procurement of input / capital goods.

5. Heard the parties. Considered the submission.

6. In this case the appellant initially paid SED by utilizing their Cenvat Credit account. The payment of excess rebate claim was paid through PLA is only a cross entry for reversal of rebate claim received in cash by the appellant. Therefore, the Cenvat Credit utilized for payment of SED was made good by the appellant taking on account of payment of SED through Cenvat credit account of which claim received was paid through PLA. In these circumstances, we hold that appellant has correctly taken the Cenvat Credit in their Cenvat Credit account being a peculiar situation in the matter. In these circumstances, we hold that appellant has taken Cenvat Credit correctly as initially appellant has taken Cenvat Credit in their Cenvat Credit account on procurement of input / capital goods which was used for payment of SED by the appellant.

7. In these circumstances, we set aside impugned order and allow the appeal with consequential relief if any.

(Dictated and pronounced in the open court)

(B. Ravichandran) (Ashok Jindal) Member (Technical) Member (Judicial)

Bhanu

2

E/1790/2006-EX(DB)