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2017 DIGILAW 719 (JK)

Shivam Electrical Industries v. Union of India

2017-08-23

ALOK ARADHE, B.S.WALIA

body2017
JUDGMENT : Alok Aradhe, J. The petition is admitted for hearing. With consent of the learned counsel for the parties, the matter is heard finally. 2. In this petition, the petitioner inter alia seeks quashment of order dated 12.05.2014 passed by Deputy Commissioner, Custom and Central Excise Division, Srinagar and writ of mandamus directing the respondents not to initiate any recovery proceedings in pursuance of order dated 12.05.2014 passed by Deputy Commissioner, Custom and Central Excise Division, Srinagar. 3. Facts giving rise to the filing of this writ petition briefly stated are that the petitioner is a partnership firm which was engaged in the manufacture of DPC Aluminum wire, DPC Aluminum Strip, DCC Copper wire, DCC Copper Strip and ACSR Conductor falling under chapter subject hearing No.45446010 and 76042910 of the Central Excise Act, 1985. The firm has its unit at Birpur Industrial Estate, Bari Brahmana, Jammu and was registered with the Central Excise Department. The petitioner was availing the benefit of notification No.56/2002/CE dated 14.11.2002 and commenced his production w.e.f. 26.03.2004. The petitioner availed the benefit of refund of excise duty by way of cash refund in DLA Account. The firm suffered losses, therefore, the factory was closed in the year 2010-11 and the registration with the Central Excise Department was surrendered on 20.02.2013. 4. In the year 2008 between 15.10.2008 to 17.10.2008, an audit was conducted by the respondents and it was alleged that the petitioner has availed CENVAT credit on the strength of the photocopy of the Cenvatable invoices. Thereupon the show cause notice was issued to the petitioner on 08.04.2010 to which the petitioner submitted a reply in which inter alia it was stated that the excise duty has already been paid and the petitioner in support of his claim annexed the photocopies of the invoices to show that it has already availed the Cenvat credit. The Deputy Commissioner of Central Excise, Srinagar by order dated 12.05.2014 inter alia held by placing reliance on Rule 9 of the Cenvat Credit Rule 2004 held that the petitioner has availed all the Cenvat credit on the basis of the photocopies of the invoices. Accordingly, the Cenvat credit to the tune of Rs.1,07,321/- and Education Cess was disallowed. The Deputy Commissioner of Central Excise, Srinagar by order dated 12.05.2014 inter alia held by placing reliance on Rule 9 of the Cenvat Credit Rule 2004 held that the petitioner has availed all the Cenvat credit on the basis of the photocopies of the invoices. Accordingly, the Cenvat credit to the tune of Rs.1,07,321/- and Education Cess was disallowed. The petitioner is also asked to pay appropriate interest under Section 11 AB of the Act and a penalty of Rs.1,07,321/- was also imposed under Rule 15 of the Credit Rule read with Section 11 AC of the Act. Being aggrieved, the petitioner filed an appeal before the Commissioner (Appeal). The Commissioner (Appeal) vide order dated 10.04.2017 rejected the same inter alia on the ground that it has no power to condone the delay beyond the period of 30 days after the expiry of the statutory period for filing of the appeal, that is, sixty days. Being aggrieved, the petitioner has approached this Court. 5. Learned counsel for the petitioner while inviting attention of this court to Rule 9 of the Rules has stated that the rule nowhere provides that on the basis of the photocopy of the invoices, Cenvat credit cannot be availed. Learned counsel for the petitioner has also invited the attention of this court to the Certificate issued by the Superintendent, Customs and Central Excise, Range III, Division I, Gaziabad dated 16.12.2008 in support of his contention that the excise duty has already been paid. Therefore, the Cenvat credit has rightly been paid by the petitioner. On the other hand, learned counsel for the Revenue submitted that the son of the petitioner has taken away the originals on 23.06.2017 and therefore, the petitioner ought to have produced the originals. 6. We have considered the submissions made by learned counsel for the parties and have perused the record. The relevant extract of Rule 9 of the Cenvat Credit Rules, 2004 reads as under: “(1) The CENVAT credit shall be taken by the manufacturer or the provider of output service or input service distributor, as the case may be, on the basis of any of the following documents, namely. The relevant extract of Rule 9 of the Cenvat Credit Rules, 2004 reads as under: “(1) The CENVAT credit shall be taken by the manufacturer or the provider of output service or input service distributor, as the case may be, on the basis of any of the following documents, namely. (a) An invoice issued by: (i) ----- ----- Explanation:- For removal of doubts, it is clarified that supplementary invoice shall also include challan or any other similar document evidencing payment of additional amount of additional duty leviable under Section 3 of the Customs Tariff Act;” From perusal of the explanation, it is evident that the expression supplementary invoice used in the rules shall also include challan or any other document evidencing payment of additional amount of additional duty leviable under Section 3 of the Customs Tariff Act. 7. The aforesaid rule in our considered opinion nowhere provides that Cenvat credit cannot be availed on the basis of photocopy of the documents especially when the respondents have not disputed the correctness of the contents of the photocopies of the invoices produced by the petitioner. From the perusal of the certificate issued by the Superintend, Customs and Central Excise, Range-III, Division-I, Gaziabad, it is evident that the excise duty has been duly paid by the petitioner. 8. For the aforementioned reasons, the impugned order dated 12.05.2017 cannot be sustained in the eye of law. It is accordingly, quashed. In the result, the order dated 10.04.2017 is also quashed. 9. The writ petition is accordingly, allowed.