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CX – Monetary limit being below Rs.1 crore, Revenue appeal is not maintainable in view of Board Instruction dated 22.08.2019: HC

2019-TIOL-2037-HC-P&H-CX

IN THE HIGH COURT OF PUNJAB AND HARYANA

AT CHANDIGARH

Case Tracker
CCE Vs JCBL LTD    [CESTAT]

CEA 30/2018 (O&M)

COMMISSIONER OF GOODS AND SERVICE TAX 
(EARLIER KNOWN AS COMMISSIONER OF CENTRAL EXCISE AND SERVICE TAX)
CHANDIGARH

Vs

M/s JCBL LTD, LALRU

Jaswant Singh & Lalit Batra, JJ

Dated: August 29, 2019

Appellant Rep by: Mr Sunish Bindlish, Sr.Standing Counsel
Respondent Rep by: Ms Priyanka Singla, Adv.

CX – The assessee is engaged in manufacture of vehicle bodies and claiming exemption from Central Excise duty on manufactured vehicle bodies on the vehicle chasis supplied by independent owners of such chasis, who purchase the same on payment of duty from manufacturer – They availed exemption on motor vehicle bodies fabricated for independent owners of chasis in terms of Sr.No.229 of Notfn dated 1.3.2001 and Sr.No.212 of Notfn dated 1.3.2002 – It is alleged that the assessee did not take credit of duty paid on chasis received from the customers but had taken credit of duty paid on other inputs used in the manufacture of such vehicles – The Tribunal while upholding the demand of Rs.57,16,828/ alongwith interest, the imposition of penalty was set aside – In view of instructions dated 22.8.2019, the instant appeal is not maintainable before this Court, the monetary limit being below Rs.1,00,00,000/-: HC

Appeal dismissed

Case law cited:

JCBL LTD – 2017-TIOL-2843-CESTAT-CHD …Paras 1,2

JUDGEMENT

Per: Jaswant Singh:

Revenue is in appeal against the order dated 5.6.2017 = 2017-TIOL-2843-CESTAT-CHD (A- 5) passed by Customs,Excise and Service Tax Appellate Tribunal,Chandigarh whereby in the appeal filed by the Revenue while confirming demand of Rs.57,16,828/- alongwith interest, penalty imposed on the respondent was set aside.

2. Briefly noticed, respondent company is engaged in the manufacture of vehicle bodies and claiming exemption from Central Excise duty on manufactured vehicle bodies on the vehicle chasis supplied by independent owners of such chasis,who purchase the same on payment of duty from manufacturer. It also manufactured vehicle bodies for chasis manufacturers who cleared the chasis on payment of duty for getting bodies fabricated from outside and cleared those motor vehicle bodies on payment of appropriate duty. The respondent availed exemption on motor vehicle bodies fabricated for independent owners of chasis in terms of Sr.No.229 of Notification dated 1.3.2001 and Sr.No.212 of Notification dated 1.3.2002. It is alleged that exemption under said notifications is available subject to the condition that the vehicle should be manufactured out of the chasis falling under heading 8706 on which duty of excise has been paid and no credit of duty paid on such chasis and other inputs used in the manufacture of such vehicles has been taken under Rule 3 or Rule 11 of the Cenvat Credit Rules,2001/2002. It is further alleged that the respondent did not take credit of duty paid on the chasis received from the customers but had taken credit of duty paid on other inputs used in the manufacture of such vehicles. It is thus alleged that as the respondent had availed credit in respect of duty paid on other inputs in violations of the conditions of the aforesaid notifications, the goods i.e. the fabricated vehicle bodies were found to be not eligible for exemption. Accordingly, show cause notices dated 13.3.2002, 4.2.2003 and 5.5.2003 (A-1)were issued to the respondent for recovery of duty amounting to Rs.57,16,828 for the period from March 2001 to April 2002. The Additional Commissioner (P&V) Central Excise Commissionerate, Chandigarh vide O-I-0 dated 12.3.2007 (A-2) confirmed demand of Rs.57,16,828/- to be recovered alongwith interest under Section 11AB of the Central Excise Act,1944 besides imposing a penalty of Rs.57,16,828/- under Rule 25 of the Central Excise Rules,2002. Aggrieved against the same, respondent filed appeal before Commissioner (Appeals),who vide O-I-A dated 29.6.2007(A-3) held that O-I-0 was not sustainable. Upon this Revenue filed an appeal before the CESTAT. The said appeal filed by the appellant was partly allowed vide order dated 5.6.2017(A-5) = 2017-TIOL-2843-CESTAT-CHD whereby while upholding the demand of Rs.57,16,828/ alongwith interest, the imposition of penalty of Rs.57,16,828/ was set aside. Hence the present appeal.

3. In the present appeal, the following substantial questions of law have been raised:-

(1) Whether the imposition of penalty under Rule 25 of the Central Excise Rules 2002 would be mandatorily imposable once the contravention of the applicable rules has been established and the demand of duty alongwith interest had been upheld by the Hon’ble Tribunal?

(2)Whether the impugned order of the Hon’ble Tribunal is liable to be quashed the same being based on incorrect facts?

(3) Whether the impugned order passed by the Ld.Tribunal is justified and in accordance with law?

4. At the time of hearing, learned counsel for the appellant admits that in view of instructions dated 22.8.2019 issued by Ministry of Finance, Department of Revenue, Central Board of Indirect Taxes and Customs (Judicial Cell) the instant appeal is not maintainable before this Court, the monetary limit being below Rs.1,00,00,000/-.

5. In view of the said instructions dated 22.8.2019 learned counsel for the appellant prays for withdrawal of the instant appeal, however, the question of law raised would remain open.

6. Dismissed as withdrawn with liberty aforesaid.

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