Principal Commissioner Vs Alkarma (Delhi High Court)
Delhi HC made it clear that if SCN was quashed on one demand then it did not restrict department to adjudicate on other demands.
Present appeal was filed u/s 35 G of the Central Excise Act, challenging the impugned order in which CESTAT quashed the show cause notice. The Respondent was engaged in the business of fabrication and fixing of aluminium utensils. Respondent had availed CENVAT credit on inputs and input services as per their ST-3 returns for the period 10.09.2004 to 31.03.2007. A SCN dated 11.02.2009 was issued raising a demand of Rs. 8,51,54,804/- against the Respondent. SCN was challenged in writ petition which was allowed by quashing the SCN by following the decision in Era Infra Engineering Ltd. vs. Union of India [W.P.(C) 3048/2008] and Y.F.C Projects Ltd. vs. Union of India [W.P.(C) 1342/2008]. SLP filed by revenue before Hon’ble SC were dismissed. After the decision of the SC on 19.02.2018, the Adjudicating Authority proceeded in the SCN and passed the Order-in-Original on 04.10.2018, by which the SCN was quashed and the proceedings were dropped. Order was challenged by the Department before the CESTAT, which also affirmed quashing of SCN. This impugned order was subject matter of the appeal. SCN had various issues for which demands were raised on different counts. Only the issue relating to free supply of materials was discussed in these judgments and none of the other issues were ever considered. Accordingly, the adjudicating authority committed an error in holding that the proceedings cannot continue against the Respondent.
