Case Law Details
Khandelwal Laboratories P Ltd Vs Commissioner of CGST & CE (CESTAT Mumbai)
The Khandelwal Laboratories P Ltd Vs Commissioner of CGST & CE case marked a significant decision by the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) Mumbai. The tribunal ruled in favor of the appellant, asserting that for MODVAT credit under Rule 57A of Central Excise Rules, 1944, what mattered was whether the inputs were duty paid, not whether the bills of entry were in the name of the person claiming the credit.
Khandelwal Laboratories P Ltd, manufacturing anti-cancer drugs on behalf of M/s. German Remedies, had taken MODVAT credit, which the department denied on grounds that the bills of entry were in the name of German Remedies. This denial led to a series of appeals and remands. The case pivots around the interpretation of Rule 57A, specifically who can avail of MODVAT credit. CESTAT, following the Bombay High Court’s verdict in Marmagoa Steel Ltd vs. Union of India, upheld the principle that the claimant could avail of MODVAT credit, provided the goods used as inputs were duty paid and the credit of duty paid on said goods hadn’t been taken before.
FULL TEXT OF THE CESTAT MUMBAI ORDER
This appeal has been filed from the impugned Order dated 11.06.20 18 passed by the Commissioner (Appeals Thane), GST & Central Excise, Mumbai rejecting the appeal filed by the appellant.
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