SHIVALIK COAL TRADERS Vs. UNION OF INDIA

JUDGEMENT

(1.) We have heard Shri Aloke Kumar and Shri Udai Chandani, learned counsel appearing for the petitioners. Shri Madhur Prakash and Shakti Dhar Dube appear for the respondents. The petitioners are private limited companies engaged in the trading of coal. They purchase coal from Coal India Limited in e-auction. None of the petitioners is a manufacturer, or a consumer of coal as a manufacturer.

(2.) The Coal India Limited was earlier availing the exemption vide Notification No. 1/2011- C.E., dated 1-3-2011 after the coal was made exigible to central excise for the first time by the Finance Act, 2011, on payment of central excise duty at 1%, without any benefit of CENVAT Credit.

(3.) In the interest of the company and in public interest, the Coal India Limited has decided to avail CENVAT credit under the provisions of CENVAT Credit Rules, 2004. It proposes to pay the central excise duty on coal @ 5% + 0.15 as cess. Accordingly, Coal India Limited has informed all the CIL production units by its letter dated 7-3-2011, that the central excise duty @ 5% (including 0.15% cess) on coal may be levied to enable it to avail the CENVAT credit under the provisions of CENVAT Credit Rules, 2004 and in this view of situation, the central excise duty has been imposed @ 5.15% so as to enable the company to avail CENVAT credit.