M/S. J K Sons Engineers Pvt. Ltd vs Commissioner Of Customs

Customs Excise and Service Tax Appellate Tribunal11 May 2015

CitationExcise Appeal No. 53122 of 2014

Ratio decidendi

The rule this decision rests on

The appellant is not liable to pay interest on reversal of Cenvat credit taken on inputs that were issued for manufacture and were destroyed in the course of manufacture (work-in-progress) during a fire, because where such inputs are destroyed during manufacture, reversal of the Cenvat credit itself is not required; interest on a reversal that is not required cannot arise.

Written by Miss Lucy from the judgment below, not taken from a headnote.

Judgment

As delivered

IN THE CUSTOMS, EXCISE AND SERVICE TAXAPPELLATE TRIBUNAL, NEW DELHIPRINCIPAL BENCH, COURT NO. IIExcise Appeal No. 53122 of 2014

[Arising out of Order-In-Appeal No. 69(CE)RPR-I/2014 dated 04/3/2014 passed by Commissioner of Customs & Central Excise (Appeals) Raipur]

For approval and signature:

Honble Mr Ashok Jindal, 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?

M/s. J K Sons Engineers Pvt. Ltd. Appellants

Vs.

Commissioner of Customs Respondent

Central Excise, Raipur (CG)

Appearance:

Shri Ravi Hulani, Advocate for the Appellants

Ms. Ranjana Jha, AR for the Respondent

CORAM:

Hon'ble Shri Ashok Jindal, Member (Judicial)

Date of Hearing /decision: 11. 5.2015

ORDER NO. FO/A 51623/2015 SM

Per Ashok Jindal :

The short issue involved in the matter is that whether the appellant is required to pay interest on reversal of Cenvat credit which has been issued for manufacture and during the course of manufacture fire took place and goods were destroyed.

2. Heard the parties. Considered the submissions.

3. Considering the fact that in the case of Rako Mercantile Traders vs. CCE, Lucknow [2014 (307) ELT 602 (Tri-Del)] has held that in case inputs were issued for manufacture and same were destroyed, in that case, the assessee is not required to reverse the Cenvat credit as reversal of Cenvat credit is not required as held by this Tribunal in the case of Rako Mercantile Traders (supra), therefore, question of payment of interest does not arise. Consequently, I hold that appellant is not required to pay interest on reversal of Cenvat credit on inputs which was issued for manufacture and were destroyed during work-in- progress. Therefore, impugned order is set aside. Appeal is allowed with consequential relief, if any.

( Dictated and pronounced in the open court )

( Ashok Jindal ) Member(Judicial)

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