Hindustan Unilever Ltd Vs C.C.E & S.T. (CESTAT Ahmedabad)
CESTAT Ahmedabad held that restriction of CENVAT Credit on supplementary invoice is applicable only in case of sale of goods. In the present case, restriction of CENVAT Credit on supplementary invoice is not applicable as there is only a stock transfer.
Facts- The issue involved in the present case is that whether the credit availed by the appellant job worker based on supplementary invoices issued by Hindustan Unilever Ltd paying differential duty on the Bulk Detergent Powder, stock transferred to the appellant M/s. Indu Home Care Product during the period June, 2012 to August, 2013, is deniable on the ground of payment of such additional duty by Hindustan Unilever Ltd allegedly on account of suppression, etc. under Rule 9(1)(b) of CENVAT Credit Rules, 2004.
Conclusion- The combined reading of Rule 9 (1)(b) and Section 2(h), it is clear that only in a case of sale of goods, the restriction of CENVAT Credit on supplementary invoice is applicable. In the present case, the transaction being not a sale transaction the restriction shall not apply.
Held that it is settled that in a case where there is no sale of goods and only a stock transfer the restriction of availment of CENVAT Credit on supplementary invoice in case of non payment or short payment of duty by the supplier unit shall not apply. In the present case involving the same facts and legal issue, the ratio of the above judgments are directly applicable. Accordingly, the appellants are entitled to the CENVAT Credit on the strength of supplementary invoices issue by M/s. Hindustan Unilever Ltd.
FULL TEXT OF THE CESTAT AHMEDABAD ORDER
The issue involved in the present case is that whether the credit availed by the appellant job worker based on supplementary invoices issued by Hindustan Unilever Ltd paying differential duty on the Bulk Detergent Powder, stock transferred to the appellant M/s. Indu Home Care Product during the period June, 2012 to August, 2013, is deniable on the ground of payment of such additional duty by Hindustan Unilever Ltd allegedly on account of suppression, etc. under Rule 9(1)(b) of CENVAT Credit Rules, 2004.
(b) whether the penalties under Section 11 AC(1)(c) of Central Excise Act upon the appellant and under Rule 26 (2) upon HUL are imposable.
2. Ms. Manshi Patil, Learned Counsel along with Shri Viraj Reshamwala, Advocate appearing on behalf of the appellant submits that restriction on availment of CENVAT Credit in respect of supplementary invoices as provided under Rule 9(1)(b) of Cenvat Credit Rules, 2004 is applicable only in a case where the clearance of goods by the supplier is made by way of sale of goods and not otherwise. In the present case since the appellant being a job worker received the goods not as a purchase, but on returnable basis for job work and no sale is involved. Accordingly, the provision of Rule 9(1)(b) of CENVAT Credit Rules is not applicable. She placed reliance on the following judgments:
