M/S Shree Siddhi Vinayak Induction PVT. LTD. vs. Commissioner Of Central Excise And Service Tax /CGST

Held

The Court held that the appellant's counsel made a candid and unequivocal concession before the CESTAT that the demand of CENVAT credit with interest was not being contested, and the relief sought was confined solely to the setting aside of the penalty. Consequently, once the demand itself stood conceded, the challenge to the extended period of limitation necessarily fell away, as limitation is intrinsically linked to the sustainability of the demand. The concession subsumed the limitation plea. The Tribunal was therefore justified in not dealing with the limitation issue or the merits of the demand, as these were no longer live issues before it. The dismissal of the rectification application was also found to be without infirmity, as there was no "mistake apparent on the record." The Court further noted an independent infirmity that the appellant company had been directed to be wound up, questioning its locus standi to pursue the appeal. The appeal was dismissed.

Facts

The appellant, M/s Shree Siddhi Vinayak Induction Pvt. Ltd., is in appeal against an order of the CESTAT dated 09.05.2016, which partially allowed their appeal, and a subsequent order dated 02.05.2018 rejecting their rectification application. The dispute originated from a Show Cause Notice dated 20.08.2010, demanding CENVAT credit of Rs. 7,73,243/- with interest and penalty for the period April 2008 to January 2009. The demand pertained to CENVAT credit on iron and steel items and cement used in the supporting structure of an overhead crane. The adjudicating authority confirmed the demand, interest, and penalty. The Commissioner (Appeals) dismissed the appellant's appeal. Before the CESTAT, the appellant conceded the demand for CENVAT credit and interest, seeking only the setting aside of the penalty. The CESTAT set aside the penalty, holding that mala fides could not be attributed, but the appellant contended that the Tribunal failed to adjudicate on the invocation of the extended period of limitation.

Key Issues

1. Whether the Tribunal committed an error, apparent or otherwise, in not returning a finding on the invocation of the extended period of limitation, contrary to Section 11AC of the Central Excise Act, 1944 and Rule 15(2) of the Cenvat Credit Rules, 2004. Petitioner's Contention: The appellant argued that the Tribunal failed to adjudicate its challenge to the invocation of the extended period of limitation, which was an error apparent on the record, and that the rectification application should have been allowed. They relied on the principle that a party cannot be faulted for not deciding an issue that was expressly given up, but in this case, the issue of limitation was not given up but was a substantive challenge to the demand. Respondent's Contention: The respondent (Revenue) implicitly argued, through the Tribunal's findings, that the appellant conceded the demand for CENVAT credit and interest, thereby rendering the challenge to the extended period of limitation moot. The Tribunal's order indicated that the appellant's prayer was confined solely to setting aside the penalty.