Samtel Color Ltd. and ors. Vs. Cce

Samtel Color Ltd. and ors. vs Cce

Type Court Judgment Court Customs Excise and Service Tax Appellate Tribunal CESTAT Delhi Decided Feb 10, 2006

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Citation: sooperkanoon.com/41755
Court: Customs Excise and Service Tax Appellate Tribunal CESTAT Delhi
Judge: S Kang, Vice, M T K.C.
Decided On: Feb 10, 2006
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

Samtel Color Ltd. and ors.

Respondent

Cce

Excerpt

.....paying duty on the transaction value but subsequently issuing some credit notes in favour of m/s l.g. electronics india pvt. ltd., therefore, the price mentioned in the invoices on which duty has been paid is not the real transaction value and in fact the real transaction value is lower than the price mentioned in the invoices.4. the contention of the applicant is that m/s samtel color ltd. is manufacturing colour tv tubes and clearing on payment of appropriate duty under the cover of invoices and m/s l.g. electronics pvt. ltd. is availing the benefit of credit as per the invoices. the contention is that the revenue is not objecting the payment of duty by m/s samtel color ltd. as their assessments were not reopened and adjudicating authority in the impugned order held that the assessment at the time of clearance of picture tubes by m/s samtel color ltd. is not relevant to the present proceedings. the contention is that as m/s samtel color ltd. is clearing picture tubes on appropriate duty is not objected by the revenue, therefore, taking credit of that duty by m/s l.g.electronics is valid. the applicant relied upon the decision of the tribunal in the case of hero cycles ltd. and anr. v. cce reported in 2003 (54) elt 764 where tribunal in similar situation held that the issue in respect of payment of duty by the manufacturer of input cannot be reopened at the respondent's end.5. the revenue also relied upon the provisions of rule 7 of cenvat credit rules to submit that the respondent of inputs who is availing the benefit of cenvat credit shall take all reasonable steps to ensure that the inputs or capital goods in respect of which credit is being taken on which the appropriate duty of excise as indicated in the documents has been paid, the contention is that appropriate duty means the duty payable on the inputs received by the manufacturer.6. we find that in this case the revenue is objecting in respect of the credit taken by m/s l.g. electronics in respect of.....

Full Judgment

2. The applicant M/s L.G. Electronics India Pvt. Ltd. filed application for waiver of pre-deposit of duty as well as of penalty. The other applicants filed application for waiver of pre-deposit of penalties only.

3. In this case, the demand is confirmed on M/s LG Electronics India Pvt. Ltd. by denying the credit in respect of picture tubes received from M/s Samtel Color Ltd. The Revenue is of the view that M/s Samtel Color Ltd. knowingly paid higher duty in respect of the picture tubes to pass on the excess credit to M/s L.G. Electronics. The contention of the Revenue is that M/s Samtel Color Ltd. manufacturer of tubes is paying duty on the transaction value but subsequently issuing some credit notes in favour of M/s L.G. Electronics India Pvt. Ltd., therefore, the price mentioned in the invoices on which duty has been paid is not the real transaction value and in fact the real transaction value is lower than the price mentioned in the invoices.

4. The contention of the applicant is that M/s Samtel Color Ltd. is manufacturing colour TV tubes and clearing on payment of appropriate duty under the cover of invoices and M/s L.G. Electronics Pvt. Ltd. is availing the benefit of credit as per the invoices. The contention is that the Revenue is not objecting the payment of duty by M/s Samtel Color Ltd. as their assessments were not reopened and adjudicating authority in the impugned order held that the assessment at the time of clearance of picture tubes by M/s Samtel Color Ltd. is not relevant to the present proceedings. The contention is that as M/s Samtel Color Ltd. is clearing picture tubes on appropriate duty is not objected by the Revenue, therefore, taking credit of that duty by M/s L.G.Electronics is valid. The applicant relied upon the decision of the Tribunal in the case of Hero Cycles Ltd. and Anr. v. CCE reported in 2003 (54) ELT 764 where Tribunal in similar situation held that the issue in respect of payment of duty by the manufacturer of input cannot be reopened at the respondent's end.

5. The Revenue also relied upon the provisions of Rule 7 of CENVAT Credit Rules to submit that the respondent of inputs who is availing the benefit of CENVAT credit shall take all reasonable steps to ensure that the inputs or capital goods in respect of which credit is being taken on which the appropriate duty of excise as indicated in the documents has been paid, The contention is that appropriate duty means the duty payable on the inputs received by the manufacturer.

6. We find that in this case the Revenue is objecting in respect of the credit taken by M/s L.G. Electronics in respect of the picture tubes manufactured and cleared by M/s Samtel Color Ltd. The Revenue is not objecting to the payment of duty by M/s Samtel Color Ltd. The Revenue wants to (sic) the credit taken by M/s L.G. Electronics in respect of the tubes cleared by M/s Samtel Color Ltd. only on the ground that M/s Samtel Color Ltd, is wrongly paid higher duty to pass on excess CENVAT credit. There is no evidence on record to show that M/s Samtel color Ltd. having excess CENVAT credit. The Revenue is not reopening the assessments of M/s Samtel Color Ltd. in respect of the clearance of picture tubes on payment of duty. In these circumstances, prima facie, the applicant had a strong case, therefore, the pre-deposit of whole of the duty and penalties are waived for hearing of the appeals. The stay petitions are allowed.

Same Court & Year Customs Excise and Service Tax Appellate Tribunal CESTAT Delh... Same Parties Samtel Color Ltd. and ors. vs Cce Same Subject Service Tax Same Judge S Kang, Vice, M T K.C.