Commissioner Central Excise Commissionerate, Rohtak vs. M/S Ultratech Cement LTD
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The Revenue (Commissioner, Central Excise Commissionerate, Sonepat) appealed against an order of the Custom, Excise & Service Tax Appellate Tribunal (CESTAT) dated 01.12.2014. The CESTAT had allowed the respondent's (M/s. Ultratech Cement Ltd.) appeal, holding that the demand for CENVAT credit denial for the period 2009 was barred by limitation, as the show cause notice was issued on 09.11.2012. The CESTAT noted that identical issues had been decided by it previously, and no malafide could be attributed to the assessee for invoking the longer period of limitation. The appeal filed by the Revenue was significantly delayed, with a delay of 1754 days in re-filing.
Held
The Court held that the appeal was liable to be dismissed on two grounds. Firstly, on the issue of merits, the Court noted that the larger Bench decision of the CESTAT in Vandana Global Ltd. had been reversed by the Chhattisgarh High Court, which was upheld by the Supreme Court by dismissing an SLP. This indicated that the issue regarding CENVAT credit for structures embedded to the earth, used as inputs for capital goods, was settled in favour of the assessee. Consequently, the Court found it unnecessary to delve into the issues of limitation and suppression, as the merits were decided against the Revenue. Secondly, the Court found the appeal to be patently time-barred due to inordinate and unexplained delay in re-filing, spanning over 1754 days. The Court found no sufficient cause for condoning this delay, citing the High Court Rules and Orders regarding the period for re-filing and the lack of justification for the delay from August 2016 to May 2022. Therefore, the appeal was dismissed.
Key Issues
1. Whether the demand for CENVAT credit denial for the period 2009, with a show cause notice issued on 09.11.2012, is barred by limitation under the relevant provisions of the Central Excise Act, 1944, and CENVat Credit Rules, 2004? 2. Whether the Revenue has established suppression or malafide intention on the part of the assessee to invoke the longer period of limitation? 3. Whether the appeal filed by the Revenue is liable to be dismissed on the ground of inordinate and unexplained delay in re-filing, without sufficient cause for condonation? Petitioner's Arguments: The Revenue argued that the issue of limitation and suppression needed to be gone into. They also contended that the CESTAT's decision on merits was incorrect. Respondent's Arguments: The respondent argued that the demand was barred by limitation. They relied on the CESTAT's finding that no malafide could be attributed. Furthermore, they highlighted that subsequent judicial pronouncements, including a dismissal of an SLP by the Supreme Court, had settled the issue on merits in their favour. They also emphasized the significant delay in the Revenue's appeal.
Sections Cited
Section 11A, Cenvat Credit Rules, 2004
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Cause title — parties, addresses and appearances
order No.100/CE/COMMR/DM/RTK/2013-14 dated 31.03.2014 passed by the Commissioner.
The Tribunal came to the conclusion that the entire demand was barred by limitation and had allowed the appeal keeping in view the fact that the demand was for the period 2009 and the show cause notice was only issued on 09.11.2012 (Annexure P-4) proposing denial of cenvat credit. It was noticed that identical issues stood decided by the Tribunal in number of decisions and, therefore, since the law was declared subsequently, no malafide can be attributed to the appellant for the purposes of alleging suppression and for invoking the longer period of limitation. On merits, it Shivani Gupta 2024.01.18 17:57 I attest to the accuracy and integrity of this document
CEA-20-2022 (O & M) -2- 2024:PHHC:003801-DB the judgment of the Gujarat High Court in Mundra Ports & Special Court, SLP (Civil) Diary No.20723/2018, Commissioner, Customs and Service Tax (CGST) vs. M/s. Shri Nakoda Ispat Ltd. through its Authorised Person was preferred, which was dismissed on 12.07.2018. 4. Resultantly, we are of the considered view that even on merits as such, the issue has been settled in favour of the assessee and, therefore, we do not feel that in the present case, the issue of limitation and whether there is any suppression as such needs to be gone into, as argued by counsel for the Revenue since on merits the issue stands decided against it. Shivani Gupta 2024.01.18 17:57 I attest to the accuracy and integrity of this document
CEA-20-2022 (O & M) -3- 2024:PHHC:003801-DB
Even otherwise, we are of the considered opinion that the appeal is also patently time barred and there is no ground to condone the delay in refiling since initially it was filed by a separate counsel way back on 27.06.2015 and had been returned with objections on 10.07.2015. The appeal was re-filed on 18.02.2016 by the earlier counsel and had been returned on 28.03.2016 and re-filed on 11.04.2016. The same was returned on 04.06.2016 to the said counsel which had been re-filed on 09.06.2016 and had been returned on 08.08.2016. In the application for condonation of delay, it has been mentioned that the earlier counsel did not return the original set of documents by saying that the original file has been misplaced and is not traceable and he is no longer on the panel. However, the fact remains that after the returning of the appeal in August, 2016, the present appeal was filed by preparing a fresh paper book only on 23.05.2022 and there is nothing to show in the application as to what transpired from August, 2016 to 23.05.2022 and, thus, the inordinate delay as such which has occurred in re- filing thereafter also cannot be justified in any manner. Even if the benefit of Covid-19 is to be granted, however, there no explanation has come forth for the non-filing for a period of 4 years from August, 2016 till March, 2020. In has been held by a co-ordinate Bench that the re-filing period is 40 days as per the High Court Rules and Orders and unreasonable period cannot be taken to remove the defects in filing. The relevant portion reads as under:- “18. We may hasten to add that there is no straight jacket formula for condonation of delay in re- filing as it depends upon the facts and circumstances of each case but it must be understood that a litigant, who Shivani Gupta 2024.01.18 17:57 I attest to the accuracy and integrity of this document
CEA-20-2022 (O & M) -4- 2024:PHHC:003801-DB has succeeded before the Competent Court, expects notice of the Higher Court up to a particular period of time and thereafter, he becomes supremely confident that no such case has been filed against him and the judgment in his favour has become final, but he is taken aback when he receives a notice from the Court after a long period when the case is re filed and the delay in re- filing thereof is condoned. As a matter of fact, the litigant before the Court has a right to sit back and relax after the expiry of prescribed period of time that no case is filed against him by his opponent but these days, there is a growing tendency to file incomplete cases and then take unreasonably long time to remove the defects, even where such defects can be cured within a very short time. For example, in the present case, once the Registry had raised the objection that there is a delay of 45 days in filing of the appeal, the applicant should have filed the application for condonation of delay or should have at least explained it while removing the objection that how the application is within limitation. As a matter of fact, the applicant simply removed the objection of delay by writing one line that it is within limitation. Secondly, the explanation given in the application for condonation of delay in its paras 4 and 5 runs contrary to each other because in para 4 of the application, it is mentioned that the paper book of the Review Application was mixed up with the pending cases, whereas in para 5 of the application, it is alleged that it has been traced out from one of the decided cases. It is not clear whether according to the averment made in para 4, the paper book of the Review Application was placed in the pending cases or according to the averment made in para 5 of the application, it was placed in the decided cases and the said decided case was mixed up with the pending cases. Shivani Gupta 2024.01.18 17:57 I attest to the accuracy and integrity of this document
CEA-20-2022 (O & M) -5- 2024:PHHC:003801-DB
In the absence of any sufficient cause having been shown, we are of the considered opinion that even on the issue of limitation, the delay is not liable to be condoned.
Accordingly, we dismiss the appeal in view of the above observations.
(G.S. SANDHAWALIA) JUDGE 12.01.2024 (LAPITA BANERJI) shivani JUDGE Whether reasoned/speaking Yes Whether reportable No Shivani Gupta 2024.01.18 17:57 I attest to the accuracy and integrity of this document
Reproduced from the public record of the Punjab and Haryana High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.