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CX – Recipient cannot be denied CENVAT Credit of duty paid by supplier of inputs on ground that supplier should not have paid such duty: CESTAT

2019-TIOL-2138-CESTAT-HYD

IN THE CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL
REGIONAL BENCH, HYDERABAD
DIVISION BENCH
COURT NO. I

Excise Appeal No. 20185 of 2014

Arising out of Order-in-Appeal No. 41/2013 (V-I) CE, Dated: 21.10.2013
Passed by Commissioner of Central Excise, Customs & Service Tax (Appeals), Visakhapatnam

Date of Hearing: 17.06.2019
Date of Decision: 17.06.2019

COMMISSIONER OF CENTRAL EXCISE CUSTOMS AND SERVICE TAX
CENTRAL EXCISE BUILDING, PORT AREA
VISAKHAPATNAM-530035, ANDHRA PRADESH

Vs

AUROBINDO PHARMA LTD
SURVEY NO. 61, 66 IDA, PYDIBHIMAVARAM, RANASTHALAM MANDAL
SRIKAKULAM – 532409 ANDHRA PRADESH

Appellant Rep by: Shri A V L N Chary, Superintendent
Respondent Rep by: Shri N Ram Reddy, Adv.

CORAM: Sulekha Beevi C S, Member (J)
P V Subba Rao, Member (T)

CX – The assessee-company manufactures bulk drugs and use Ethanol for manufacturing final products – The assessee purchased Ethanol from an entity, which paid Excise duty on the product for many years – SCN was served to the assessee, alleging that the assessee irregularly availed credit on Ethanol, as the product contained Alcohol and was not classifiable under Chapter 29 – Being non-excisable goods, no duty was payable by the other company – Hence the assessee was found to be ineligible for credit – On adjudication, duty demand was proposed with interest and equivalent penalty – On appeal, such findings were quashed by the Commr.(A) – Hence the present appeal by the Revenue.

Held – A similar issue stands settled in the assessee’s own case for a previous period – Following the same, Revenue’s appeal is unsustainable: CESTAT

Revenue’s appeal dismissed

Case laws cited:

AUROBINDO PHARMA LTD – 2015-TIOL-2773-CESTAT-BANG… Para 2

Commissioner vs. Neuland Laboratories Limited [2015(319)ELT A 140 (A.P)]… Para 4

FINAL ORDER NO. A/30563/2019

Per: Sulekha Beevi:

1. The facts of the case are that the respondents are manufacturers of bulk drugs and use ethanol as input for manufacture of final products. They purchase ethanol from M/s Andhra Sugars Limited who were paying excise duty on the product for many years. A show cause notice was served upon respondents raising the allegation that the respondents have irregularly availed credit on Ethanol (Ethyl alcohol) as the product contained alcohol and was not classifiable under Chapter 29. Thus, not being excisable goods, no duty was payable by M/s Andhra Sugars Limited. Therefore, the respondents are not eligible for credit. After due process of law, the original authority confirmed the demand along with interest and ordered recovery of the wrongly availed credit with interest and imposed equal amount of penalty. In appeal, the Commissioner (Appeals) set aside the order passed by the original authority. Aggrieved by the said order, the department has filed the present appeal.

2. The issue is settled by the decision in respondent’s own case vide Final Order No. A/31086/2016, dated 26.10.2016 and the judgment reported in [2016(339)ELT 263 (Tri.-Hyd.)] and Final Order No. 22100-22102/2015 = 2015-TIOL-2773-CESTAT-BANG , dt. 28.10.2015.

3. The Ld. AR, Shri A.V.L.N. Chary appeared on behalf of the department. He reiterated the grounds of appeal.

4. Following the decision in the respondent’s own case, the appeal filed by the department is without merits. On the very same issue, the Hon’ble Jurisdictional High Court of Andhra Pradesh had upheld the decision of the Tribunal as reported in Commissioner vs. Neuland Laboratories Limited [2015(319)ELT A 140 (A.P)].

5. The appeal is therefore dismissed.

(Dictated and pronounced in open court)

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