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)
Interest on Foreign Currency Loan & Corresponding Forex Loss for Strategic Share Acquisition Held Deductible as Revenue Expenditure
The tax treatment of interest on funds borrowed to acquire shares hinges on a single, crucial distinction: the purpose behind the acqu...
-
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...
-
Section 68 -Cash credits Section 69 -Unexplained investments Section 69A - Unexplained money, etc Section 69B -Amount of investme...
-
The overall effective tax rate of a U.S. multinational corporation may have significant impact on the value of its stock. Therefore, it ...
-
An eminent concern within the GST framework pertains to the entitlement of Input Tax Credit (ITC) concerning expenditures associated with In...
-
There are certain changes in India's tax rules for TDS on payments made to non-residents. The Income Tax Act, 2025 ('ITA 2025'...
-
Recent judicial pronouncements across different forums have clarified several important aspects of Indian income tax law, particularly relat...
-
Ahmedabad Tribunal Special Bench has ruled that corpus distributed on dissolution of an offshore discretionary trust to resident Indian be...
-
The posting had been move to another website. Please click the link below to get the access of the same. https://taxofindia.wordpress....
-
Did you come across many errors and mistakes while checking your CIBIL report status? Are you wondering how to clear yourself out of CIBIL ...
-
The Income Tax department has been modified the Form No. 15G & 15G as per amended notification No. 11/2013 [F.NO.142/31/2012-SO(TPL)]/...
No comments:
Post a Comment