Subscribe to the Bombay Chartered Accountant Journal Subscribe Now!

October 2011

(2011) 23 STR 341 (A.P.) Commissioner of Central Excise, Visakhapatnam-II v. Sai Sahmita Storages (P) Ltd.

By Puloma Dalal, Jayesh Gogri
Chartered Accountants
Reading Time 1 mins
fiogf49gjkf0d
Availment of Cenvat credit by storage and warehouse provider — Without using cement and TMT bar, the assessee could not provide storage and warehousing services — Assessee entitled to credit of Central Excise duty paid on these items — No penalty could be imposed without a finding on suppression and irregular claim of CENVAT credit.

Facts:
The assessee provided storage and warehousing services. They used cement and TMT bars for construction of warehouses and took credit on Central Excise duty paid on cement and TMT bars which was disallowed, against which the assessee filed an appeal before the Commissioner (Appeals) who dismissed the appeal and allowed the Department’s claim of suppression regarding availment of Cenvat credit on ineligible goods.

Held:
CESTAT referred to the judgment of the Supreme Court in Maruti Suzuki Ltd. v. Commissioner of Central Excise, Delhi III, 2009 (9) SCC 193 wherein it was held that “all goods used in or relation to the manufacturer of the final products qualify as inputs” and had rectified the decision of the Appellate Authority by allowing credit. The Court confirmed CESTAT’s stand on allowance of credit and consequently non-levy of penalty.

Download PDF

You May Also Like

Filing of Statement of Affairs for Companies under Liquidation.

Natural Justice — Order passed in violation of principles of natural justice should not be quashed, but the matter should be remanded to grant an opportunity of hearing.