S. S. Garg, Member (J)
1. The present appeal is directed against the Order-in-Appeal No. JNK-EXCUS-000-APP-1111-14-15 dated 25.03.2015 passed by the Commissioner (Appeals) whereby the ld. Commissioner (Appeals) has partly allowed the appeal by setting aside the penalty but confirming the demand of inadmissible Cenvat Credit and also upheld the recovery of interest.
2. Briefly stated facts of the case are that the appellant are holding Central Excise Registration and are engaged in the manufacture of M.S. Ingots falling under Tariff Heading 72 of the First Schedule to the Central Excise Tariff Act, 1985 (5 of 1986) and are availing the benefit of exemption under Notification No. 56/2002-CE dated 14.11.2002. The appellant have filed refund claims by way of self credit for the period from October 2010 to March 2011 under the provisions of the said Notification. On scrutiny of refund claims filed by the appellant, it was observed by the Adjudicating Authority that the appellant have taken inadmissible self credit of Education Cess and S&H Education Cess in contravention of para 2C of the Notification as the self credit under the Notification is limited to the amount of duty (Cenvat) paid and nor for Education Cess and S&H Education Cess. Accordingly, show cause notice was issued to the appellant and in adjudication proceedings, the Adjudicating Authority vide its order-in-original disallowed the irregularly availed self credit and confirmed the recovery of the same. The Adjudicating Authority has also imposed equal penalty under Section 11AC of the Central Excise Act, 1944. Aggrieved by the said order, the appellant filed appeal before the ld. Commissioner (Appeals), who vide the impugned order, dropped the penalty but confirmed the demand along with interest. Hence, the present appeal.
3. None appeared on behalf of the appellant and the appellant vide their e-mail dated 11.10.2023 requested the Tribunal to decide the case on its merit in view of the decisions of Hon’ble Supreme Court.
4. On the other hand, the learned DR reiterated the findings of the impugned order.
5. Heard the learned DR for the Revenue and perused the grounds of the appeal filed by the appellant.
6. As per the grounds of the appeal, the appellant have stated that they had followed the provisions of the Notification entirely and have already paid the entire amount in dispute within five days of the date of intimation of the said order. The appellant have rightly taken the self credit in respect of cesses as the appellant are entitled to refund of the same as they are entitled to the benefit of exemption under the Notification, which exempts the goods manufactured by the appellant from the Cenvat (BED) paid by them through PLA other than the amount of duty paid by utilization of Cenvat Credit under the Cenvat Credit Rules, 2004, meaning thereby that BED paid in cash and refunded subsequently, is just notional and in fact BED other than the amount of duty paid by utilization of Cenvat Credit under the Cenvat Credit Rules, 2004 has been treated as Nil. The appellant have also stated in the grounds of appeal that the refund claims issued under the Notification are not in the nature of refunds which are dealt in under Section 11B of the Central Excise Act, 1944. This intention of the legislation has been amply clarified by the CBEC vide its Circular No. 682/73/2002-CX dated 19.12.2002. Again, this fact has also been elucidated by the CBEC vide its instructions dated 08.12.2006.
7. After considering the grounds of the appeal and the submissions made by the learned DR, we find that the identical issue was considered by this Tribunal in the case of M/s Alu Bond Enterprises vs. CCE & ST, J&K vide Final Order No. 60696/2023 dated 08.12.2023 (in Excise Appeal No. 240 of 2016), wherein the Division Bench of this Tribunal has held in para 5 and 6 as under:-
“5. Heard both sides and perused the records of the case. We find that the impugned order considers the self-credit taken by the appellants as “erroneous” credit and confirms the demand of the same in terms of Section 11A of Central Excise Act, 1944 along with interest and penalty under Section 11AC ibid. We find that Hon’ble High Court Jammu & Kashmir vide their order in CEA 06/2018 held that:
“The refund of excise duty claimed by an assessee and sanctioned by the competent Authority vide its order under Notification No. 56 of 2002-CE which order has attained finality as not having been challenged before any appellate or revisional authority under the Excise Act cannot be termed as 'erroneous refund' and recovered by resort to section 11A of the Act. The extended period of limitation as provided under proviso to sub section (1) of Section 11A would be attracted only in a case where the refund made in favour of the assessee is erroneous by reason of fraud, collusion or any wilful misstatement or suppression of facts, or contravention of any provisions of the act and the rules framed there under with an intent to evade payment of duty by the assessee or his agent.”
6. In addition to the above, learned Counsel for the appellants submits that the jurisdictional Assistant Commissioner has since quantified the refund admissible to the appellants vide OIOs No. 1135 to 1141/AC/R(S)JMU/14 dated 07.07.2014 and 945 to 955/AC/R(s)JMU/14 dated 23.06.2014.”
8. Since the issue is no more res integra and this Tribunal in the above cited case has held that the impugned order is not sustainable in law; therefore, by following the ratio of said decision in the above cited case, we hold that the impugned order is not sustainable and we set aside the same by allowing the appeal of the appellant.
