Case Law Details
Indus Tropics Ltd Vs C.C.E. & S.T. Rajkot (CESTAT Ahmedabad)
The issue in brief is that though entire defaulted amount of central excise duty along with interest stands deposited with a delay of few weeks, the Department is of the view that as per the provisions of Rule 8(3A) of Central Excise Rules, 2002, the appellant should have paid the entire delayed payment of Rs. 1,41,36,316/- in cash rather than same being paid by utilizing Cenvat credits.
The operative portion of M/s. ANDHRA CYLINDER P.LTD. is reproduced below
“14. In view of the above, we find that at least four different High Courts have struck down the constitutional validity of Rule 8(3A) of Central Excise Rules, 2002 and appeals against such judgments have been admitted by the Hon’ble Supreme Court and have yet to be decided. There was a stay in one case i.e., Indsur Global Ltd (supra) only but there was no stay in respect of the other judgments. Learned departmental representative relies on the judgment of Larger Bench of Hon’ble Supreme Court in the case of West Coast Paper Mills (supra) to assert that once an appeal has been admitted before the Hon’ble Supreme Court, the judgment of the High Court or Tribunal is in jeopardy and cannot be followed. We find that this judgment was of the year 2004. What needs to be decided in this factual matrix is where there are judgments by four different High Courts holding Rule 8(3A) as ultra vires and there is no judgment of any High Court upholding it and where the appeals against these judgments have been admitted and are under consideration of the Hon’ble Apex Court, whether the ratio of these judgments bind this tribunal or otherwise. We find that the last in the series of judgments was passed by the Hon’ble High Court of Bombay in the case of Nashik Forge Pvt Ltd (supra) on 17.09.2018 holding that the ratio of the judgment of the Hon’ble High Court of Madras, Gujarat and Punjab & Haryana apply. Respectfully following the decision of the Hon’ble High Court of Bombay, we follow the ratio of the aforesaid judgments of the Hon’ble High Courts and hold that the demand is unsustainable and needs to be set aside. Consequently, penalties imposed upon the appellant also need to be set aside and we do so.”
Since the given facts of the appeal are identical to the one which has been decided by the above mentioned order, we follow the same and decide to allow the appeal.
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