C.C.E. & S.T.-Vadodara-I Vs Welspun Corp Ltd (CESTAT Ahmedabad)
CESTAT Ahmedabad held that suo moto re-credit duly allowable as eligibility of cenvat credit on outward transportation has attained finality and decided in favour of the appellant.
Facts- The respondent had availed cenvat credit in respect of outward transportation which was disputed by the department by issuing a show cause notice and proposing to deny cenvat credit on outward transportation. The respondent had reversed the cenvat credit in register vide their RJ- 23A-Pt-II, entry No 2583 dated 08.12.2005 and 967 dated 15.06.2007.
Accordingly, the said suo motu credit was taken after the Tribunal allowed the cenvat credit on outward transportation. The revenue has issued show cause notice dated 10.04.2013 whereby it was proposed to disallow the cenvat credit of Rs. 59,35,233/- which was suo motu re – credited by the respondent. The proceeding of the said show cause notice was dropped by the Commissioner (Appeals) vide impugned order-in original dated 15.10.2013. Being aggrieved by the said order dated 15.10.2013, the revenue filed the present appeal
Conclusion- As regard the suo motu re-credit we are of the view that the entire proceeding was to disallow the cenvat credit on outward transportation and during the proceeding the respondent had reversed the credit when the Tribunal has allowed the credit on merit in respect of outward transportation vide Tribunal Final Order No A/416-417/WZB/AHD/2012 dated 19.03.2012. The respondent was legally entitled for re-credit as consequential relief flowing from the said Tribunal’s order. Therefore we do not see anything wrong in taking the suo moto re-credit which is clearly in compliance to the Tribunal’s order.
Held that we do not find anything wrong in respondent’s taking suo moto re-credit of cenvat credit which was reversed.
FULL TEXT OF THE CESTAT AHMEDABAD ORDER
The brief facts of the case are that the respondent had availed cenvat credit in respect of outward transportation which was disputed by the department by issuing show cause notice dated 27.11.2007 proposing to deny of cenvat credit on outward transportation. Moreover, the respondent had reversed the cenvat credit in register vide their RJ- 23A-Pt-II, entry No 2583 dated 08.12.2005 and 967 dated 15.06.2007. The show cause notices were issued on 15.06.2007 and 27.11.2007 which were adjudicated vide Order-In-Original dated 21.02.2006and 30.09.2008 whereby the cenvat credit was denied. Being aggrieved by the said Order-In-Original the respondent filed the appeal before this Tribunal and the same was allowed vide final order no. A/416-417/WZB/AHD/2012 dated 19.03.2012 by allowing the cenvat credit on outward transportation against which the Revenue filed the appeal before the Hon’ble Supreme Court. The Hon’ble Supreme court vide order dated 17.01.2018 dismissed the Revenue’s appeal. Accordingly, the eligibility of cenvat credit on outward transportation in the respondent’s case attained finality in their favour.
1.2 In another proceeding which is related to the appeal here in respondent had taken suo-motu re-credit which was reversed during proceeding of the above case. The said suo motu credit was taken after the Tribunal allowed the cenvat credit on outward transportation in the case discussed above. The revenue has issued show cause notice dated 10.04.2013 whereby it was proposed to disallow the cenvat credit of Rs. 59,35,233/- which was suo motu re – credited by the respondent. The proceeding of the said show cause notice was dropped by the Commissioner (Appeals) vide impugned order-in original dated 15.10.2013. Being aggrieved by the said order dated 15.10.2013, the revenue filed the present appeal on two grounds:-
i. The respondent is not entitled to take suo motu re-credit.
ii. Against the Tribunal order the Revenue filed the present appeal before the Supreme Court.
2. Shri Rajesh K Agarwal, Learned Superintendent (AR) appearing on behalf of the Revenue appellant reiterates the grounds of appeal.
3. Shri Hardik Modh, Learned Counsel appearing on behalf of the Respondent submits that the respondent had reversed cenvat credit because the department has disputed the cenvat credit on outward transportation. Subsequently, the proceeding for dis-allowance of such credit was carried out and the cenvat credit was allowed by the Tribunal. Therefore, in view of the Tribunal Order, the respondent has legally and correctly re-credited cenvat credit which was also reversed.
3.1 As regard the ground that Revenue has filed the appeal before the Hon’ble Supreme Court, the Hon’ble Supreme Court has dismissed the Revenue’s appeal and therefore, the said ground does not exist.
3.2 He submits that as regard the suo motu re-credit, in the identical facts this Tribunal and High Court has passed various orders. He placed reliance on the following judgments:-
