HPCL Mittal Energy Limited Vs Commissioner of Central Excise & Service Tax (CESTAT Chandigarh)
Material Facts
The appellants, M/s HPCL Mittal Energy Ltd. (HMEL), established a refinery manufacturing polypropylene, LPG, naphtha, motor spirit, kerosene, ATF, diesel, turpentine oil, hexane, coke and other petroleum products. For fabrication of storage tanks and mechanical piping, HMEL engaged M/s Bridge & Roof Co. (India) Ltd. and M/s Artson Engineering Ltd. HMEL supplied stainless steel sheets, plates, valves, bolts and similar materials free of cost to the contractors, while the contractors procured certain other inputs such as tools, tackles, plants and equipment. HMEL reimbursed the taxes paid on such contractor-procured items, and invoices showed HMEL as the consignee.
HMEL availed CENVAT credit on both the inputs procured directly and those procured by the contractors. Following audit, the department alleged that the contractor-procured materials constituted inputs of the contractors rather than HMEL and issued two show cause notices demanding reversal of CENVAT credit amounting to Rs. 10,68,46,038 and Rs. 31,99,88,570 respectively, along with interest and equal penalty. The adjudicating authority confirmed the demands, leading to the appeals.
Procedural History
The appeals challenged Orders-in-Original dated 12.03.2014 and 30.05.2014 confirming denial of CENVAT credit together with interest and penalties.
