J.K. Paper Limited Vs. Cce

J.K. Paper Limited vs Cce

Type Court Judgment Court Customs Excise and Service Tax Appellate Tribunal CESTAT Delhi Decided Mar 16, 2005

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Citation: sooperkanoon.com/38490
Court: Customs Excise and Service Tax Appellate Tribunal CESTAT Delhi
Judge: N T C.N.B., P Bajaj
Decided On: Mar 16, 2005
Subject: Service Tax

Case Summary

AI-generated summary - not the official court judgment text.

Service Tax

Key legal issue: Service Tax

Parties & Advocates

Appellant / Petitioner

J.K. Paper Limited

Respondent

Cce

Legal References

Reported In: (2005)(100)ECC337

Excerpt

1. the appellant is a manufacturer of paper. it takes modvat credit in respect of inputs used in such manufacture. pulp emerges at the intermediate stage in the manufacture of paper. the appellant cleared a small portion of that pulp by way of sale or otherwise, while most of the pulp was captively used in the manufacture of paper. the appellant was keeping separate accounts of inputs used in the manufacture of captively consumed pulp and the pulp which is sold. the quantity of inputs used in both the uses was being worked out on the basis of input-output norm. there was no use wise (sic) separate storage of inputs. under the impugned order, the appellant has been directed to pay 8% of the value of the pulp sold in terms of rule 57cc of the central excise rules. this rule is applicable to cases where no separate inventory is kept in respect of inputs used in dutiable and non-dutiable goods.2. the contention of the learned counsel for the appellant is that the commissioner was not right in holding that the appellant was not keeping separate inventory, merely for the reason that the inputs for both the uses were stored in a common storage tank. it has been submitted that this position remains settled by the decision of this tribunal in the case of cce, new delhi v. padmini polymers, 2003 (87) ecc 300 (t) : 2003 (151) elt 358. learned counsel has also brought to our notice a subsequent order of the commissioner (appeals) [order-in-appeal no. 132/bbsr-i/04 dated 23.4.04] wherein the commissioner (appeals) dropped the demand raised against the appellant for identical reasons for subsequent period.3. we have perused the records and heard the learned sdr also. on the requirement for keeping separate inventory, this tribunal noted as under in the case of cce, new delhi v. padmini polymers "11. we note that in the scn a lot of emphasis has been placed on separate storage of the raw materials used in the manufacture of final exempted product and raw materials used in the.....

Full Judgment

1. The appellant is a manufacturer of paper. It takes Modvat credit in respect of inputs used in such manufacture. Pulp emerges at the intermediate stage in the manufacture of paper. The appellant cleared a small portion of that pulp by way of sale or otherwise, while most of the pulp was captively used in the manufacture of paper. The appellant was keeping separate accounts of inputs used in the manufacture of captively consumed pulp and the pulp which is sold. The quantity of inputs used in both the uses was being worked out on the basis of input-output norm. There was no use wise (sic) separate storage of inputs. Under the impugned order, the appellant has been directed to pay 8% of the value of the pulp sold in terms of Rule 57CC of the Central Excise Rules. This rule is applicable to cases where no separate inventory is kept in respect of inputs used in dutiable and non-dutiable goods.

2. The contention of the learned Counsel for the appellant is that the Commissioner was not right in holding that the appellant was not keeping separate inventory, merely for the reason that the inputs for both the uses were stored in a common storage tank. It has been submitted that this position remains settled by the decision of this Tribunal in the case of CCE, New Delhi v. Padmini Polymers, 2003 (87) ECC 300 (T) : 2003 (151) ELT 358. Learned Counsel has also brought to our notice a subsequent order of the Commissioner (Appeals) [Order-in-Appeal No. 132/BBSR-I/04 dated 23.4.04] wherein the Commissioner (Appeals) dropped the demand raised against the appellant for identical reasons for subsequent period.

3. We have perused the records and heard the learned SDR also. On the requirement for keeping separate inventory, this Tribunal noted as under in the case of CCE, New Delhi v. Padmini Polymers "11. We note that in the SCN a lot of emphasis has been placed on separate storage of the raw materials used in the manufacture of final exempted product and raw materials used in the final dutiable product. The contention of the respondent herein was that the rules do not contain any such requirement of separate storage, therefore, there was no violation or contravention of any Rule. We find force in the contention of the respondent herein. We have examined the provisions of Rule 57C and 57CC and we do not see any such requirement of separate storage of the two categories of inputs. We note that under Rule 57CC(9) what is required is that separate inventory and accounts of the receipt, use of inputs for the purpose of manufacture of final products, clearly under exemption be maintained. We note that the adjudicating authority has examined each aspect legally as well as factually for coming to the conclusion. Therefore, we do not see any reason to interfere with the impugned order passed by the Ld. Commissioner. The same is, therefore, upheld insofar as M/s Padmini Polymers and Shri Vivek Nagpal and Shri R.K. Chawla are concerned. The same is sustainable in law and we hold accordingly.

The appellant's case remains covered by the aforesaid decision of the Tribunal. Further, Revenue cannot take different stands for different periods on the same issue. The appeal is allowed with consequential relief, if any, to the appellant.

Same Court & Year Customs Excise and Service Tax Appellate Tribunal CESTAT Delh... Same Parties J.K. Paper Limited vs Cce Same Subject Service Tax Same Judge N T C.N.B., P Bajaj