M/S. Tirupati Tubes vs C.C.E. Ghaziabad

[Arising out of Order-In-Appeal No. 165-S. Tax/GZB/11-12 dated: 16.08.2011 passed by CCE (Appeals) Ghaziabadl]

For approval and signature:

Hon'ble 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?

M/s. Tirupati Tubes ...Appellant

Vs.

C.C.E. Ghaziabad Respondent

Appearance:

None for the Appellant

Mr. R K Mishra, DR for the Respondent

CORAM:

Hon'ble Mr. S.K. Mohanty, Member (Judicial)

Date of Hearing/ Decision. 29.07.2015

Final Order No. 54082 /2015_

Per S K Mohanty:

The appellant is engaged in the manufacture of PVC pipes falling under chapter 39 of the Central Excise Tariff Act, 1985. The appellant avails cenvat credit in respect of PVC raisins used in or in relation to manufacture of the said final product as inputs. The appellant also avails cenvat credit in respect of service tax paid on the GTA service and Commission Agent service. During the disputed period, the appellant removed the input i.e. PVC raisins as such from the factory and reversed cenvat credit in terms of Rule 3(5) of the Cenvat Credit Rules, 2004. Since the input service taken on GTA services and Commission agent service were not reversed by the appellant, Department initiated proceedings against the appellant for demanding the service tax attributable to such services. The Show Cause Proceedings initiated in this regard, culminated in the Adjudication Order, in confirming the cenvat demand. In appeal, the Commissioner (Appeals) has upheld that adjudged demand. Hence the present appeal before this Tribunal.

2. Heard the Ld. DR Sh. R K Mishra for the Respondent and perused the written submissions filed by the appellant.

3. The short question involved in this appeal for consideration is, as to whether, the appellant is required to reverse the service tax credit, in the eventuality, where the inputs are removed as such from the factory. Rule 3(5) of the Cenvat Credit Rules provides that when inputs or capital goods on which cenvat credit has been taken or removed as such from the factory, the manufacturer of the final product shall pay an amount equal to the credit availed in respect of such inputs or capital goods and such removal shall be made under the cover of an invoice referred to in Rule 9. On perusal of the said statutory provisions, it reveals that reversal of equal amount of cenvat credit is required in case of removal of inputs and capital goods and not with regard to credit taken on the input service. Since there is no identical or parallel provisions exist in the cenvat statute, providing for reversal of cenvat credit on input service, I am of the considered view that the demand confirmed in the present case by the Authorities below is not sustainable. Therefore, the impugned order is set aside and the appeal is allowed in favour of the appellant.

(Dictated and pronounced in open court)

(S. K. Mohanty) Member(Judicial)

Neha

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ST/1664/2011-[SM]