Extended period not invocable if there are contrary decisions.

PJ/Case Law/2014-15/2355

Case:- NEOGEN CHEMICALS LTD Vs COMMISSIONER OF CENTRAL EXCISE, BELAPUR

Citation:- 2014-TIOL-371-CESTAT-MUM

Brief facts:-The appellant is in appeal against the impugned order wherein CENVAT Credit availed on MS angle, MS beam, etc. has been claimed by the appellant as capital goods, which were used for foundation/structure of the machine/equipment, was denied by the lower authorities on the premise that as these items were used in erection of supporting structure, which are embedded to earth, therefore, they are not entitled to take credit.

Appellant’s contentions:-Ld. Counsel for the appellant submits that they have taken the input credit of these items during the period 2006-08 and show cause notice came to be issued on 22.05.2009 by invoking the extended period of limitation.

As the issue whether the CENVAT credit on these items is available or not was in dispute during the period and by the decision of Vandana Global 2013 (293) ELT 186 dated 30.04.2010 = (2010-TIOL-624-CESTAT-DEL-LB), the Larger Bench of this Tribunal held against the assessee. In these circumstances, extended period of limitation is not invocable. To support, he relied on ITC Ltd. vs. CCE 2012 (258) ELT 292. He also relied on CCE vs. Doodhganga Krishna Shakari Sakkare Karkhane Niyamit 2013 (297) ELT 361.

Respondent’s contentions:- On the other hand ld. AR submits that in the light of the decision in Vandana Global(supra) andSaraswati Sugar Mills 2011 (270) ELT 465 (SC) = (2011-TIOL-73-SC-CX) the appellants are notentitled to take credit and in the light of the decision of Vandana Global (supra), extended periodof limitation is invocable.

Reasoning of judgment:- In the light of the decision of Vandana Global (supra) the appellant have no case. But on limitation, they are having a case in spite of the decision of ITC Ltd. (supra). As the issue whether the appellant are entitled to take CENVAT Credit on the impugned items during the period or not was in dispute and the same was referred to the Larger Bench of the Tribunal and this Tribunal in Vandana Global (supra) decided the matter against the assessee. Therefore, when the issue of eligibility of credit was in dispute during the impugned period, the extended period is not invocable. Accordingly, they hold that in this matter, the extended period of limitation is not invocable.

Decision:- The appeal is allowed.

Comment:- The analogy of the case is that the CENVAT credit on MS angle, MS beam, etc. as capital goods, used for structure of machine/equipment is not allowed as it was used in the errection of supporting structure. However, the extended period of limitation is not invocable as there were contrary decisions during the material period of time and the issue was settled only after the larger bench decision in the case of Vandana Global.

Prepared by: Monika Tak

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PJ/Case Law/2014-15/2355

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