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Birla Corporation Ltd V/S C.C.E., Udaipur

Company & Directors' Information:- BIRLA CORPORATION LIMITED [Active] CIN = L01132WB1919PLC003334

    Excise Appeal No. E/50068/2016 [SM] (Arising out of Order-in-Original No. UDZ-EXCUS-000-COM-34-15-16 dated 13.10.2015 passed by the Commissioner, Central Excise, Udaipur) and Final Order No. 56580/2017

    Decided On, 11 September 2017

    At, Customs Excise Service Tax Appellate Tribunal New Delhi

    By, MEMBER

    For Petitioner: Sukriti, Advocate And For Respondents: G.R. Singh, D.R.

Judgment Text

1. This is the second round of litigation before the Tribunal. In the initial round, the appellant had preferred appeal against the adjudication order dated 27.02.2014 before this Tribunal, which was disposed of vide Final Order No. 54621/2014 dated 26.11.2014 in remanding the matter to the adjudicating authority for de novo adjudication. The relevant paragraph in the said order dated 26.11.2014 is extracted herein below:-

"6. Surprisingly the said report of the Dy. Commissioner, which was sought by the Commissioner himself, stands fully ignored by him while passing the present impugned order. For the reasons best known to him, the adjudicating authority has completely shut his eyes towards the said report. If the said report of the Dy. Commissioner was not to be taken into consideration by the adjudicating authority, we really fail to understand and appreciate as to why the report was called for. Probably the said report has not been referred to by him as the same is in favour of the assessee, to the major extent. Such an action, on the part of the adjudicating authority, cannot be appreciated inasmuch as the same reflects upon the biased premature determination of their adjudication. Having said so, we deem it fit to set aside the impugned order and remand the matter to the Commissioner for fresh decision in the light of the report dated 29.01.2014 of the Dy. Commissioner. We also note that a major part of the demand is barred by limitation and the appellant would be within their right to contest the same on the ground of time bar. The stay petition as also appeal gets disposed of in the above manner."
2. Pursuant to the remand direction of the Tribunal, the Adjudicating Authority took up the de novo adjudication proceedings and passed the order dated 13.10.2015 (impugned herein), wherein Cenvat Credit of Rs. 42,60,079/- was disallowed alongwith interest and equal amount of penalty was imposed on the appellant.

3. The ld. Advocate appearing for the appellant submits that based on the documents maintained by the appellant, the Jurisdictional Range Superintendent under the cover of his letter dated 24.01.2014 has submitted the report to the adjudicating authority stating that wherever the disputed goods were used for manufacture of the capital goods and repair and maintenance of the capital goods, on those items the credit had been availed by the appellant. With regard to the other items, which were purely used as structural items, the credit has not been availed. She further submits that the report furnished by the Superintendent and various registers/records maintained by the appellant, showing issue of disputed goods to different shops for execution of different job have not been properly verified by the adjudicating authority and the Cenvat Credit was denied entirely on the ground that the same are not eligible for the Cenvat benefit. She has relied on the decision of this Tribunal in the case Singhal Enterprise Pvt. Ltd. Vs. Commr. of Cus. & C. Ex., Raipur : 2016 (341) ELT 372 & Prism Cement, Unit-II vs. Commr. of Central Excise & Service Tax, Bhopal : 2016 - TIOL - 3261 - CESTAT - Del., to state that the disputed goods by nature of their use within the factory premises, should merit consideration as either inputs or capital goods for the purpose of availment of Cenvat Credit.

4. On the other hand, the ld. D.R. appearing for the respondent reiterates the findings recorded in the impugned order. He further submits that the onus lies with the appellant to prove the nature of use of the disputed goods has not been satisfactorily discharged, inasmuch as, no documents/records were produced before the adjudicating authority showing that the disputed goods were, in-fact, used for manufacture of the eligible capital goods installed in the factory. Thus, he submits that in absence of any documentary evidence, denial of Cenvat Credit by the adjudicating authority cannot be questioned and the impugned order passed by the authority below is maintainable under the statute. Further, he submits that during the disputed period, the definition of input has clearly excluded the disputed goods from its purview for the purpose of Cenvat benefit.

5. Heard both sides and perused the case records.

6. I find that without considering the verification reports submitted by the Jurisdictional Range Superintendent, the ld. Commissioner of Central Excise, vide order dated 27.02.2014 had disallowed the Cenvat benefit to the appellant. Upon appreciation of the fact that the verification report of the Range Superintendant was required for ascertainment of the benefit of Cenvat Credit, the Tribunal has remanded the matter back to the adjudicating authority for fresh decision in light with such report dated 24.01.2014 submitted by the Dy. Commissioner, Central Excise. However, on perusal of the impugned order, I find that the adjudicating authority has not specifically referred to the observations made in the report dated 24.01.2014 that substantial quality of the disputed goods were used for manufacture of capital goods and for repair of capital goods within the factory; and that wherever the disputed goods were used for the purpose, other than of manufacture and repair, the appellant had not availed any Cenvat credit. However, in the remand proceedings also, the adjudicating authority has not dealt with the issue, for which, the matter was specifically remanded to him.

7. In view of the fact that on the basis of records/registers maintained by the a

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ppellant, the Range Officer and the Jurisdictional Dy. Commissioner have certified that the credit on the disputed goods should be available, I am of the view that the verification report dated 24.01.2014 cannot be discarded at this juncture, inasmuch as the ld. Adjudicating Authority has not specifically addressed the issue and has not based his findings on any additional documents/records in this context. 8. Therefore, I do not find any merits in the impugned order in disallowing the Cenvat benefit to the appellant. Accordingly, after setting aside the same, I allow the appeal in favour of the appellant.