HC
disallows utilization of basic excise duty credit towards payment of NCCD and
Education Cesses to motor cycle manufacturer (assessee) availing area based
exemption under Notification No. 50/2003-CE; Rejects assessee’s plea that since
final product is not exempt from NCCD and other Cesses, this would necessarily
render provision of Rule 6 of CENVAT Credit Rules, 2004 (CCR) inapplicable;
Observes, while it can be said that basic excise duty paid would be available
for payment of NCCD and Cesses as they fall under category of “any duties of
excise” imposed on the final product (excluding period subsequent to 2016
amendment in 5th proviso to Rule 3(4) whereby credit utilization has been
restricted to NCCD alone), Rule 6 is intended to cover cases where the main
duty i.e. basic excise duty is exempt; States that in present case, substantial
duty invariably would be basic excise duty whereas NCCD and other Cesses are
essentially surcharges calculated as percentage thereof; Elucidates, “…the
intention was that when the final product is exempted from the payment of the
substantial part of the aggregate of the levies in a case where apart from the
excise duty, there are surcharges, as NCCD and cesses in this case, then when
the assessee opts for the benefit of the exemption from the duty under Section
3, then it would not also, at the same time, claim further benefit by way of
CENVAT credit…”; As regards imposition of 100% penalty u/s 11AC, HC upholds
Revenue contention that mere deposit of duties, either before or after issuance
of notice, would not absolve assessee from liability to pay penalty, be it
under protest or otherwise, where assessee is otherwise found liable; Rejects
assessee’s reliance on host of judicial precedents to plead that there was
no mala fide intention and that matter involved legal interpretation,
but accepts that it was of bona fide view that CENVAT credit utilization of
basic excise duty paid on inputs was permissible against NCCD and Education
Cesses; Finds no scope of any interpretation for including NCCD or Cesses under
the expression “duty of excise” while noting that assessee’s ER-1 Returns also
revealed its awareness about leviability of all duties of excise including NCCD
and Cesses; Consequently, relying on SC ruling in Dharmendra Textile
Processors, HC holds that “penalty is mandatory and there is no discretion
to the authorities on quantum of such penalty” : Uttarakhand HC
Subscribe to:
Post Comments (Atom)
GST Not Leviable on Transfer of Leasehold Rights of MIDC Plots: SC Dismisses Revenue’s SLP
In a significant development, the Supreme Court has dismissed the Revenue’s Special Leave Petition (SLP) challenging a Bombay High Court (...
-
· Legal Framework: Section 171 of the Income Tax Act, 1961 provides the legal framework for the partition of a Hindu Undivided...
-
New utility for generation of Form 16A in pdf format provided by https://www.tdscpc.gov.in is very light and is sized only 8.43 MB while ...
-
1. Introduction Cross-border investment structures often employ intermediate holding companies in jurisdictions like the Cayman Islands. A c...
-
A new website launched for TDS related matters www.tdscpc.gov.in TRACES – T DS R econciliation A nalysis and C orrection E nabling S yste...
-
Issue before the Income-tax Appellate Tribunal (ITAT) Whether the phrase “paid up capital and general reserves” should be defined as “Ne...
-
Introduction Employee welfare is a cornerstone of corporate responsibility, and gratuity forms a critical part of the social security benefi...
-
Facts Saptarshi Ghosh (the tax payer) was a salaried employee of TCS Limited (employer), an Indian company. He was on deputation to the U...
-
Selling a property can trigger a significant tax liability in the form of capital gains tax. However, the Income-tax Act, 1961, allows you...
-
In the complex landscape of India’s Goods and Services Tax (GST), the tax treatment of non-compete fees has emerged as a critical area f...
-
The newly enacted Income Tax Act, 2025, marks a significant step toward simplification by consolidating multiple presumptive taxation sche...
No comments:
Post a Comment