We have heard Mr. Y. N. Ravani, learned standing counsel for the Revenue and Mr. Deven Parikh, learned senior counsel for respondent. 2.0 This tax appeal has been filed on the following question of law which is extracted as below.
“Whether the Tribunal was correct in allowing transfer of deemed credit to Cenvat Credit account once the notification was rescinded, in absence of any transitional provisions?”
3.0 The facts are that on 06.11.2001 the appellant had lodged refund of the accumulated deemed credit of Rs.8,40,720/ in terms of Rule 5 of Cenvat Credit Rules, 2001. The application filed by the appellant was rejected by the Assistant Commissioner, Central Excise by order dated 5th August 2002 on the ground that the credit of specified duty can only be allowed in respect of inputs used in the final products cleared for export under Bond whereas in the respondent's case the goods had been cleared under AnnexureI for the manufacture of export goods and also that the goods had been cleared at nil rate of duty the claimant would not be entitled to the credit due to the embargo of the provisions of Rule 6 of Cenvat Credit Rules, 2001. The respondent challenged the order of Assistant Commissioner, Central Excise in appeal. The appeal was allowed by Commissioner (Appeals) on 4th February 2003 and he set aside the order passed by the Assistant Commissioner and directed the amount to be refunded to the appellant. In pursuance of the order of the Commissioner, the department granted refund to the respondents and debited the deemed credit amount of the respondent to the extent of amount refunded in cash to the respondent. However, the department challenged the order of the Commissioner dated 4th February 2003 in appeal. The appeal of the department wsa allowed on 4th October 2005 by the CESTAT and it was held that since the respondent not submitted the Bill of Lading or Shipping Bill, therefore he was not entitled for refund of deemed credit. In view of the order passed by CESTAT the appellant deposited back the amount of Rs.7,67,865/ and took credit of equal amount in RG23 Part II register which is known as Cenvat Credit Account. In pursuance of the show cause notice issued pursuant to order dated 4th October 2005 order for recovery of amount was issued on 31st August 2006 and in pursuance thereof the appellant deposited the amount.
4. Once the appellant took back the credit again then the department started fresh proceedings against the respondent that the respondent has wrongly taken Cenvat Credit. The Assistant Commissioner by order dated 25th February 2008 held that the appellant has taken credit of the deemed credit in his Cenvat Credit Account wrongly. In appeal filed by the respondent, the Commissioner (Appeals) reversed the findings and held that once the Cenvat Credit amount was refunded by the respondent then they were not entitled to retake the credit. Department filed appeal before the CESTAT which was affirmed by the Tribunal vide order dated 15th October 2010.
5. We have examined the only question raised in this appeal that once Notification No.53/01 CE(NT) dated 29.06.2001 was rescinded by Notification No.6/2002 dated 1st March 2002 which came to be rescinded on 1st March 2003. We have considered the question raised by learned counsel for the appellant. This question has already been decided by Division Bench of this Court in Commissioner of Central Excise, AhmedabadII vs. Omkar Textile Mills Pvt. Ltd. [ 2010 (262) ELT 115 (Guj.)] wherein it has been held that in para:8 the Division Bench has held as under.
“8. Having heard Mr. Ravani, learned Standing Counsel appearing for the Revenue and having perused the order of the authorities below including the ordeer passed by the Tribunal in the case of S.V. Business Pvt. Ltd. (supra) and judgment of this Court as well as Hon'ble Supreme Court we are of the view that the issue is squarely covered by the earlier decision. This Court in the case of Dipak Vegetable Oil Industries Ltd. v. Union of India (supra) had clearly held that a right, which is acquired as a result of a statutory provision cannot be taken away retrospectively unless the statutory provision so provides or by necessary implication it has the same effect. Even with regard to the proviso to Rule 3 support can be derived from the observations made by the Hon'ble Supreme Court in the case of Eicher Motors Ltd. v. Union of India, 1999 (106) E.L.T. 3 (S.C.) the scheme sought to be introduced cannot be made applicable to the goods which had already come into existence in respect of which the earlier scheme was applied under which the assessees had availed of the credit facility for payment of taxes. Any manner or mode of application of the said rule would result in affecting the rights of the assessees. The Hon'ble Supreme Court further observed that Section3 7 of the Act does not enable the authorities concerned to make a rule which cannot be said to be applied to the goods manufactured prior to 1631995 on which duty had been paid and credit facility thereo has been availed of for the purpose of manufacture of further goods. The Court further observed that when on the strength of the rules available certain acts have been done by the parties concerned, incidents following thereto must take place in accordance with the scheme under which the duty had been paid on the manufacture products and if such situation is sought to be altered, necessarily it follows that right, which had accrued to a party such as availability of a scheme, is affected and, in particular it loses sight of the fact that the provision for facility of credit is as good as tax paid till tax is adjusted on future goods on the basis of the several commitments which would have been made by the assessees concerned.”
6. In view of this decision of Division Bench, the argument of learned counsel for the appellant that since Notifications were rescinded the Cenvat Credit which was available to the respondent is not correct. The respondent would be entitled to maintain credit taken by them.
7. For the aforesaid reasons, we do not find any merit in this appeal. We are of the considered opinion that no substantial question of law arises for consideration of this Court. This tax appeal is accordingly dismissed.
[V. M. SAHAI, J.]
Amit
[N. V. ANJARIA, J.]