Surya Alloy Industries Limited and Another vs Union of India and Another

Harish Tandon, J.—The order dated 26th November 2013, passed by the Customs, Excise & Service Tax Appellate Tribunal, East Regional Bench, Kolkata, is the subject matter in this writ petition. The order, imposing duty upon the petitioner, is assailed before the Tribunal by the petitioner.

In the said appeal, an application, seeking waiver of the pre-condition deposit of duty, was taken out. The Tribunal, as it appears, has proceeded to pass an order on the basis of a Larger Bench judgment of the Tribunal, rendered in the case of 2010 (253) ELT 440 and directed deposit of 25% of the duty imposed by the assessing officer.

According to the petitioner, the judgment, rendered in the case of Vandana Global Limited (supra), is no longer a good law in view of the judgment rendered by the Supreme Court in the case of Commissioner of Central Excise, Jaipur Vs. Rajasthan Spinning and Weaving Mills Ltd.,

The petitioner further relies upon a subsequent judgment of the Tribunal, rendered in the case of 2013 (291) ELT 585 wherein it is specifically held that the Larger Bench decision of the Tribunal, in the case of Vandana Global Limited (supra), is no longer a good law. The petitioner, thus, says that since the foundation of the impugned order itself is based on the Larger Bench judgment of the Tribunal, which is no longer a good law, the impugned order is not sustainable.

The learned advocate, appearing for the respondents, vehemently refutes the aforesaid contention and says that the judgment, rendered in the case of Vandana Global Limited (supra), was, in fact, applied by the Tribunal to the benefit of the petitioner. It is further submitted that the petitioner could not produce any material before the assessing officer or the Tribunal in support of its contention that the materials, for which the CENVAT Credit was availed of, were used as inputs to the final product.

Attention of the Court is drawn by the petitioner to the certificate, issued by the chartered accountant, in support of the contention that those materials were used as capital goods and, therefore, the Tribunal has proceeded on a wrong premise and, therefore, the order is unsustainable.

The foundation of the order, passed by the Tribunal, is laid upon the judgment of the Larger Bench, rendered in the case of Vandana Global Limited (supra), which does not hold the field because of the subsequent judgment rendered by the Supreme Court. The Tribunal, in subsequent matters, has clearly indicated that the Larger Bench judgment of the Tribunal is no longer a valid law and, therefore, this Court finds that the order impugned cannot be sustained at all. It does not appear from the impugned order whether the judgment of the Supreme Court and the subsequent judgments of the Tribunal were placed before the Tribunal or not. Furthermore, the Tribunal did not record any findings on the merit of the matter. This Court, therefore, feels that justice would be sub-served if the application, seeking waiver of the pre-condition deposit of duty, is considered afresh by the Tribunal.

Accordingly, the order impugned is quashed and set aside.

The matter is remanded to the Tribunal for reconsideration. The Tribunal shall consider all the materials placed before it and/or that may be placed by the parties and shall dispose of the said application by recording reasons, in accordance with law.

It is, however, made clear that this order shall not be construed to have been made on the merit of the application and the Tribunal shall be free to decide the same independently and without being swayed by any of the observations made herein.

With the aforesaid observations, the writ petition is disposed of.

There shall, however, be no order as to costs. Let the downloaded copy of this order, counter-signed by the Registrar (Listing), be handed over to the learned advocates of the parties upon usual undertaking.