CCE VAPI Vs. AARTI INDUSTRIES LTD.

JUDGEMENT

(1.) APPEAL No.E/288/2011 -SM has been filed by the Revenue on the ground that Commissioner (Appeals) vide OIA No.SKSS/235/DMN/ VAPI -I/2010 -11, Dt. 09.11.2010 had wrongly remanded the matter to the adjudicating authority when he had no powers to remand any appeal in view of CBEC F.No.275/34/2006 -CX 8A, dt. 18.02.2010. Appeal No. E/10681/2013 has been filed by the Revenue against the OIO dt. 29.08.2011 passed by the adjudicating authority in remand proceedings as a result of OIA No. SKSS/235/DMN/ VAPI -I/2010 -11, Dt. 09.11.2010. In this appeal, Revenue has contested that adjudicating authority and the first appellate authority has no jurisdiction when appeal filed by the Revenue against OIA No. SKSS/235/DMN/ VAPI -I/2010 -11, Dt. 09.11.2010 was pending before CESTAT. It is thus the case of the Revenue that order of sanctioning refund of Rs. 32,42,385/ - with modification vide OIA No. OIA No.SRP/177/DMN/2012 -13, dt. 31.12.2012 is not proper and needs to be set aside. Appeal No.E/10765/2013 has been filed by the appellant on the ground that Commissioner (Appeals) has wrongly disallowed the credit of Education Cess and Secondary & Higher Secondary Cess as per the formula prescribed in Rule 3(7)of CENVAT Credit Rules, 2004.

(2.) SHRI G.P. Thomas, (AR) appearing on behalf of the Revenue argued that Commissioner (Appeals) has no power to remand a case to the adjudicating authority and the subsequent orders passed by the lower authorities are not proper. He defended that portion of the order passed by the first appellate authority which restricted the refund claim as per Rule 3(7)(a) of the CENVAT Credit Rules, 2004.

(3.) HEARD both sides and perused the case records of these appeals. On the issue of remand, the issue already stands settled as per this Bench decision in the case of Bacha Motors (P) Ltd Vs. CST Ahmedabad [2010 (255) ELT 30 (Tri -Ahmd)]. On merits of restriction of CENVAT Credit as per Rule 3(7)(a) of CENVAT Credit Rules, 2004, it is observed from the opening sentence of Rule 3(7)(a) that the provision will be applicable to the inputs or capital goods produced or manufactured by a 100% EOU. In the instant case, as borne out from the facts argued the disputed goods were not produced or manufactured by the appellant's 100% EOU. Otherwise also, CENVAT Credit of cesses have been held to be admissible as per the case laws relied upon by the appellant.