Thermo Fisher Scientific India Pvt. Ltd. Vs Commissioner of CGST & Central Excise (CESTAT Mumbai)
The Mumbai Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) dismissed the appeals filed against confirmation of demand, interest, and equal penalty relating to non-reversal of Cenvat credit on the Special Additional Duty (SAD) component while transferring imported inputs “as such” from one manufacturing unit to another under Rule 3(5) of the Cenvat Credit Rules, 2004. The dispute involved transfers made between March 2016 and January 2017, where the assessee reversed credit relating to Countervailing Duty (CVD) and education cess but failed to reverse SAD credit amounting to Rs. 4,77,073 and Rs. 1,13,366 respectively.
The lapse was detected during a Special Audit conducted by the DG Audit team. Upon being informed, the assessee refused to reverse the credit, contending that the demand was barred by limitation and that extended period under Section 11A(4) of the Central Excise Act could not be invoked. The assessee argued that the omission occurred due to inadequate knowledge of staff and absence of intention to evade duty. It further submitted that the transaction was revenue neutral because any reversal at one unit would have been available as credit to the receiving unit.
