Delhi High Court
S.R.V. Print Pack Pvt. Ltd. vs Commissioner Of Central Excise on 15 September, 2011
Author: A.K.Sikri
* IN THE HIGH COURT OF DELHI AT NEW DELHI
% Decision Delivered on: 15th September, 2011
+ CEAC NO.27/2011
S.R.V. PRINT PACK PVT. LTD. .....Appellant
Through: Ms. Aditi Pandey, Advocate.
-versus-
COMMISSIONER OF CENTRAL EXCISE .....Respondent
Through: Mr. Mukesh Anand, Advocate with
Mr. Shailesh Tiwari and Mr. R.C.S.
Bhadoria, Advocates.
CORAM:
HON'BLE MR. JUSTICE A.K. SIKRI
HON'BLE MR. JUSTICE SIDDHARTH MRIDUL
1. Whether reporters of local papers may be allowed to see
the Order?
2. To be referred to the Reporter or not?
3. Whether the Order should be reported in the Digest?
A.K. SIKRI, J. (ORAL)
1. Notice. Mr. Anand, Advocate, accepts notice on behalf of
the Respondent.
2. Since both the parties are ready to argue the matter
finally, we have heard the arguments and proceed to dictate the
order.
3. This Appeal is filed against the Order dated 18th March,
2011 passed by the learned Customs, Excise and Service Tax
Appellate Tribunal (hereinafter referred to as „the CESTAT‟) on
the stay application filed by the Appellant in the Appeal which is
still pending before the CESTAT. Vide impugned Order, the
Appellant is directed to deposit 60% of the amount demanded
within a period of eight weeks while waiving the amount of
interest and penalty demanded by the Adjudicating Authority.
4. We may record that CESTAT has passed the impugned
Order along with two other Appeals on identical facts on the
same date i.e. 18th March, 2011. Orders were passed by the
CESTAT directing those appellants as well to deposit 60% of the
demanded amount.
5. In the instant case, the CESTAT has simply followed those
orders in view of the commonality of facts and has directed the
Appellant to make a deposit of 60% of the amount demanded as
a pre-condition for hearing the Appeal. The cases referred in
Paragraph 5 of the impugned Order include M/s A-One
Laminators Pvt. Ltd. M/s A-One Laminators Pvt. Ltd. has
challenged the said order by filing CEAC No.15/2011 in this
Court and that Appeal was allowed by this Court vide Order
dated 4th July, 2011. Keeping in view that facts of the two cases
are identical, and following the said order, we allow this Appeal
as well.
6. We may put on record that the Appellant is engaged in
printing and lamination of polyester film with metalized
film/polyester film. These metalized films are polyester which
are further converted into pouches and bags. The Appellant has
been treating the aforesaid activity as manufacturing activity
and has been paying the excise duty thereupon. On this
premise, the Appellant took Cenvat credit on the duty paid on
inputs. However, the Adjudicating Authority reversed the
Cenvat credit and directed the Appellant to pay back the same
holding that the aforesaid business activity of the Appellant
does not amount to manufacture and, therefore, the Appellant
was not entitled to credit on duty paid on inputs. In the orders
dated 4th July, 2011 passed by this Court in the case of M/s A-
One Laminators Pvt. Ltd., the contention of the Appellant, in
these circumstances, was noted and dealt with in the following
manner:
"5. The neat submission made by the learned
counsel for the appellant is that if the aforesaid
process is not to be treated as manufacturing
process and the appellants are not entitled to
Cenvat credit on that basis, then the appellants
were also not required to pay any excise duty. It is
also pointed out that the excise duty paid by the
appellants is much more than the Cenvat credit
availed by the appellant. It is also pointed out that
Cenvat credit was not claimed or paid to the
appellant in cash but was utilized in payment of
excise duty only. There is adequate force in this
submission of the appellants and we are of the
view that the CESTAT while passing the impugned
order could not have glossed over these glaring
facts which would clearly disclosed a prima facie
case like this and the appellant should not be
fastened with any liability of making pre-deposit,
as directed.
6. In the aforesaid circumstances, are of the
view that the appeals of the appellants should be
heard without any condition of pre-deposit. These
appeals are accordingly allowed and the impugned
directions of the Tribunal are set aside."
7. Mr. Mukesh Anand, learned Counsel appearing for the
Respondent has drawn our attention to the orders passed by the
Adjudicating Authority on the basis of which argument is raised
that the Adjudicating Authority took into consideration
Judgment of the Supreme Court in the case of Metlex India Pvt.
Ltd. vs. Commissioner of Central Excise, 2004 (165) ELT 129,
wherein the Supreme Court held that the process of
lamination/metallization of duty paid plastic films would not
amount to manufacture. On this basis in Paragraph 20 of the
order it is stated that the goods did not qualify the definition of
manufacture and therefore no Cenvat credit was payable. At the
same time we find that the Adjudicating Authority has not dealt
with the issue that if the process was not to be treated as
manufacture then why the excise duty was collected from the
Appellant. Mr. Anand did not dispute that the excise duty paid
by the Appellant is much more then the Cenvat credit paid. For
this reason we are of the opinion that in a matter like this the
Appeal should be heard without any condition of pre deposit.
A.K. SIKRI, J.
SIDDHARTH MRIDUL, J.
SEPTEMBER 15, 2011
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