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Parle Biscuits Pvt. Ltd. and Others V/S CCE & ST, Rohtak

    Appeal Nos. E/2041, 163-164/2008 (Arising out of Order-in-Appeal No. 151/ANS/RTK/2008 dt. 18.07.2008 and 465-466/KKG/RTK/2007 dt. 25.10.2007 passed by the Commissioner of Central Excise (Appeals), Delhi-III, Gurgaon) and Final Order Nos. 61039-61041/2017

    Decided On, 23 May 2017

    At, Customs Excise Service Tax Appellate Tribunal Chandigarh Bench

    By, MEMBER

    For Petitioner: Vikrant Kackaria, Advocate And For Respondents: Harvinder Singh, AR

Judgment Text

1. The appellants are in appeal against the impugned order wherein Cenvat Credit sought to be denied to them.

2. The brief facts of the case are that the appellants are manufacturer of various excisable products like biscuits, printed laminated wax paper, flavor mix etc. Towards manufacture of their products they have installed machines/capital goods. For undertaking the process of printing they make use of Graved Printing Cylinders. When the cylinder was worn-out due to repeated used, they sent such cylinders to the job workers who is in the jurisdictional of the another Commissionerate and received back reconditioned cylinders for the further use. The cylinders were sent to the job worker under Rule 4(5) of the Cenvat Credit Rules and the job worker paid the duty on reconditioned cylinders on the value of reconditioned cylinders. On receipt of the cylinders, the appellants availed Cenvat Credit of duty paid by the job worker.

3. The Department is of the view that the reconditioning of the cylinders does not amount to manufacture, therefore, job worker was not required to pay duty on reconditioned cylinders. Consequently the appellants are not entitle to take Cenvat Credit of duty paid by the job worker. In these set of facts, the proceedings were initiated against the appellants and after issuance of the show cause notices, adjudication took place. Consequently, the Cenvat Credit was denied to the appellants, therefore, same was required to be recovered along with interest and penalties were also imposed on all the appellants. Aggrieved from the said order appellants are before us.

4. The Ld. AR raised the preliminary objection that as there are 3 Orders-in-Original and the appellants have filed only one composite of appeal, therefore, the appeal is not maintainable in terms of Rule 6A of the CESTAT Procedural Rules, 1982. To support this contention, he relied upon the decision of Shree Cement Ltd. Vs. CCE, Jaipur-II 2009 (247) ELT 383 (Tri.-Del.)

5. On the other hand, the ld. Counsel for the appellants opposed the contention of the Ld. AR and submits that the similar issue came up before this Tribunal in the case of Satake India Engineering P. Ltd. Vs. CCE & ST, Delhi : 2014 (303) ELT 451 (Tri. Del.) and this Tribunal held that the appeal is maintainable against the composite adjudication order.

6. Heard the parties and perused the provisional Rule 6A of CESTAT, procedural Rule 1982 which are extracted herein below:-Considering the provisions of Rule 6A of CESTAT (Procedure) Rules, 1982 and more particularly the explanation clause to said Rule, it is obvious that when the original authority passes more than one order on account of more than one show cause notices issued to the assessee, in that case, aggrieved party filing the appeal against such orders has to file as many memorandum of appeals as the number of orders-in-original passed by the original authority. Even though such orders are disposed of by the Commissioner (Appeals) by one single order, further appeals will also be governed by explanation to Rule 6A and being so, it will be necessary for the appellant to file two different appeals, in the case in hand, bearing in mind the fact that original authority has disposed of two show cause notices by two orders. Hence, para 3 of the order dated 23-4-09 needs to be recalled and therefore, is accordingly hereby recalled. Order dated 23-4-09 in Stay Application No. 230/2009 should be read excluding para 3.

We find that the issue in hand was considered by this Tribunal in the case of Satake India Engineering P. Ltd. Vs. CCE & ST, Delhi (supra) wherein, this Tribunal has observed as under:-

6. Rule 6A of the CESTAT (Procedure) Rules, 1982 requires one Memorandum of Appeal to be preferred against the order or decision of the authority below, notwithstanding the number of show cause notices, price lists, classification lists, bills of entry, shipping bills, refund claims/demands, letters or declarations adjudicated in the decision or order to the appealed against. Thus, where an adjudication order and is passed in respect of several show cause notices by way of a composite order, only one appeal need be filed. This is so irrespective of whether the composite order-in-original is given a single number or multiple numbers. However, where distinct numbers are given to a composite adjudication order, passed in respect of a several show cause notices, and against such adjudication order appeals are preferred to the Commissioner (Appeals), in such circumstances, as many appeals must be filed before this Tribunal as the number of orders-in-original to which the case relates, in so far as the appellant is concerned. This is a consequence of Explanation (1) to Rule 6A.

7. In the present matters, in respect of which this reference is preferred to the Bench, the subject matter of the challenge in each of the appeals is to a composite order-in-original bearing distinct numbers pertaining to multiple show cause notices. In the circumstances it is Rule 6A and not Explanation (1) that applies. As a consequence one appeal against each of the impugned orders-in-original, even though distinct numbers are provided by the adjudicating authority to each of the composite orders, would suffice.

Further, the reliance of the Ld. AR in the case of Shree Cement Ltd. Vs. CCE, Jaipur-II (supra) is not applicable to the facts of this case. As in the said case no composite Orders-in-Original were passed by the Adjudicating Authority, therefore, the said facts are not similar to the case in hand. As the facts of the case are covered by the decision of Satake India Engineering P. Ltd. Vs. CCE & ST, Delhi (supra) therefore, we hold that the appeal filed by the appellants is maintainable before this Tribunal and appellants are not required to filed separate/multiple appeals.

7. Now we come to the merits of the case. It is an admitted fact that the job worker has paid the duty on job worker goods and payment of duty by the job worker has not been objected by the Revenue. In that circumstances, Cenvat Credit cannot be denied to the appellants in terms of Rule 3 of Cenvat Credit Rules, 2004. A similar issue was dealt by the Hon'ble Punjab & Haryana High Court in the case of V.G. Steel Industry Vs. CCE : 2011 (271) ELT 508 (P & H) wherein the Hon'ble High Court has observed as under:-

5. Learned counsel for the appellant submits that even if the duty has been paid in excess of the amount finally held to be payable, unless the excess duty paid has been refunded, the assessee could claim cenvat credit as the department could not get the duty twice. Reliance has been placed on order of this Court dated 22-7-2010 in CEA No. 42 of 2010 Commissioner Central Excise, Chandigarh v. M/s. Guwahati Carbons Ltd. wherein after referring to earlier judgments of this Court in CCE v. Ranbaxy Labs Ltd : 2006 (203) E.L.T. 213 and CCE v. Swaraj Automotives Ltd : 2002 (139) E.L.T. 504 and judgment of Madras High Court in CCE v. CEGAT, Chennai : 2006 (202) E.L.T. 753 the plea of the assessee was upheld. Learned counsel for the respondent is unable to distinguish the applicability of the judgment relied upon on behalf of the appellant.

Further in the case of CCE, Chennai-III Vs. Sundaram Auto Components Ltd : 2015 (325) ELT 104 (Mad.) the Hon'ble Madras High Court has further observed as under:-

6. The above issue has already been answered by the Supreme Court in International Auto Ltd. v. Commissioner: [2005 (183) E.L.T. 239 (S.C.)]. A Bench of this scour has also held in Commissioner of Central Excise, Puducherry v. Kohinoor Printers Pvt. Ltd. [2015 (321) E.L.T. 448] that the credit of duty paid by the job worker even when he is not required to pay it, can be availed by the manufacturer. This decision of a Bench of this Court followed an earlier decision of the Supreme Court in Commissioner v. Narmada Chematur Pharmaceuticals Ltd. [2005 (179) E.L.T. 276].

7. What happened in this case was that the first respondent/assessee handed over plastic materials during the period from July, 2006 to December, 2006 to a Company by name Nypro Forbes Products Private Limited for carrying out certain job works. The goods were handed over after availing credit for inputs, but, not actually paying duty. The Company which undertook the job work, while returning the goods, after carrying out the job work, raised invoices, for amounts including the duty that they paid. Even according to the Department, the job worker was not liable to make payment of duty. But, since the duty was paid by the job worker and also claimed from the first respondent/assessee, the first respondent/assessee claimed credit.

8. But, the Department went on a wrong presumption that credit had been claimed twice by the first respondent. As a matter of fact, the assessee did not claim credit twice over. At the time when the goods were supplied, they availed the credit. After the Company which undertook the job work, had paid the duty, even according to the Department, the job worker was not liable to pay it. Since they have paid and collected it from the assessee, what the first respondent collected was only the duty that had to be paid on account of the mistake committed by the job worker. The original aut

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hority and the appellate authority wrongly construed the same as a double benefit by applying the theory of unjust enrichment. This is what was rectified by the Tribunal. Hence, the order of the Tribunal is in accordance with law. Therefore, the question of law is answered in favour of the assessee. The appeal is dismissed. No costs. Further we find that in the case of Pearl Polymers Ltd. Vs. CCE, Gurgaon : 2016 (342) ELT 600 (Tri.- Chan.) this Tribunal considered the issue and held that Cenvat Credit cannot be denied to the assessee. Admittedly, the job worker has paid the duty on the job worked goods and the appellants have taken Cenvat Credit on the basis of invoices issued by the job worker. 8. In that circumstances, we hold that the appellants have correctly taken the Cenvat Credit on the invoices issued by the job worker for job worked goods. Therefore, we do not find any merit in the impugned orders, the same are set aside. 9. The appeals are allowed with consequential relief (if any).