M/S. Sartorius Mechatronics India Pvt ... vs Commissioner Of Central Excise, ...

[Arising out of Order-in-Appeal No. 166 & 166A/2010-CE dated 31/05/2010 passed by the Commissioner of Central Excise (Appeals-I), Bangalore.]

For approval and signature:

HON'BLE SMT. ARCHANA WADHWA, JUDICIAL MEMBER

1 Whether Press Reporters may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982? No 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? Seen 4 Whether Order is to be circulated to the Departmental authorities? Yes

M/s. SARTORIUS MECHATRONICS INDIA PVT LTD NO.69/2, & 69/3, KUNIGAL ROAD, NELAMANGALA, BANGALORE 562 123. Appellant(s)

Versus

Commissioner of Central Excise, Service Tax And Customs BANGALORE-II PB 5400 CR BUIDING, QUEENS ROAD, BANGALORE  560 001. KARNATAKA Respondent(s)

Appearance:

Shri T.V. Ajayan, Advocate RAVI SHANKAR & CHANDER KUMAR, ADVOCATES 504,4TH FLOOR, OXFORD TOWERS, NO.139, OLD AIRPORT ROAD, KODIHALLI, BANGALORE - 560008 KARNATAKA For the Appellant

Shri N. Jagadish, Superintendent (AR) For the Respondent

Date of Hearing: 27/05/2015

Date of Decision: 27/05/2015

CORAM:

HON'BLE SMT. ARCHANA WADHWA, JUDICIAL MEMBER

Final Order No. 21205-21206 / 2015

Per : ARCHANA WADHWA

The appellant is a manufacturer of weighing systems and they also undertake installing the same at the customers premises. They procured the MS platforms for weighbridge station from independent fabricators and the said MS platforms after payment of duty by the said suppliers directly reached the place at which the weighbridges were to be installed. The appellants were paying duty on electronics and other components cleared by them from their factory. In 2005, the audit raised an objection to the effect that the appellants were required to pay duty on the whole value of the weighing systems including the MS platforms procured from third parties and directly received in the weighbridge station. The appellants, thereafter, started paying duty on full value of the weighing system as per the purchase order. The MS platforms have been sold by the appellant at prices higher than the prices at which they procured from third parties. While paying duty on the weighing system as a whole, the appellants have taken credit of duty paid on the MS platforms by the supplier of the said platforms. The credit taken has been denied on the ground that MS platforms have not been received in the factory premises of the appellants and demand of Rs.15,88,290/- relating to the period July 2006 to September 2007 and demand of Rs.46,32,229/- relating to the period September 2007 to August 2008 stand confirmed along with interest and penalties imposed.

2. The learned advocate for the appellant submits that they were paying duty only on items cleared from their factory which was objected to by the department and they were directed to include the value of MS platforms procured from third parties and received directly at the weighbridge station. As a result, they were forced to pay higher duty on a higher value though the MS platforms were directly received from the third party. Under these circumstances, while paying higher amount of duty, they have chosen to take credit of the duty paid on the MS platforms. There is no irregularity. If there is any irregularity, it is at the direction of the respondent (Revenue). Even otherwise, the differential duty paid by them attributable to the value of MS platforms is higher than the credit taken by them.

3. After hearing both the sides, I find that the issue is no more res integra and it stands held that inputs not received directly in the factory but received at site of the project are also cenvatable inputs and credit cannot be denied on this short ground of not bringing the inputs into the factory. The appellant had admittedly included the value of the said inputs in the value of their final products and have paid duty of excise on the full value including the value of the inputs. Tribunal in the case of Commissioner of Central Excise, Ghaziabad vs. Central Electronics Ltd.:2011 (271) E.L.T. 586 (Tri.-Del.) has held that in the absence of any dispute that the inputs were duty-paid, were utilized in the final product, on which duty has been paid, the mere fact of non-receipt of goods in the factory but sent directly at site of the project will not result in the denial of credit to the assessee. As such, I find no reasons to deny credit to the appellant. Accordingly, the impugned order is set aside and appeal allowed with consequential relief to the appellant.

(Operative portion of the order was pronounced in open court on 27.5.2015.)

ARCHANA WADHWA JUDICIAL MEMBER rv 3