The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Mumbai Bench quashed recovery on the ground that there was failure to consider evidences relating to availment of depreciation under Income Tax Act, 1961.
In the present appeal Commissioner of Central Excise, Customs and Service Tax, the appellant, M/s Seven Hills Constructions impugns three separate recoveries under authority of Rule 14 of CENVAT Credit Rules, 2004 for being credit held as ineligible on two separate counts even as availment of depreciation under Income Tax Act, 1961 was assailed as breach in common.
The appellant is a provider of ‘mining services’ that was legislated as liable to tax with effect from 1st June 2007 by way of amendment in section 65(105) of Finance Act, 1994 for which the appellant, however, acquired registration only on 3rd October 2008.The appellant had furnished written reply to notice stating denial of opportunity to be heard in person, owing to casual approach to that facet of adjudication, has been raised in the grounds of appeal.
A Coram consisting of C J Mathew, Technical Member and Ajay Sharma, Judicial Member gave an elaborate analysis by noting that the order has failed to take into consideration the liability discharged by the appellant and settled law on such compliance must be given effect to. The Bench was also of the view that contention of the appellant that depreciation claimed earlier has since been revised and appropriate changes made in returns under Income Tax Act, 1961 should have to be considered.
The Division Bench also pointed out that the Adjudicating Authority was required to consider the evidence furnished by the appellant that duty liability having been discharged on ‘tippers’ sourced by them before concluding that the credit availed therein is ineligible.
Quashing the recovery the Tribunal observed that “The impugned order is, thus, bereft of findings based on law, as enacted and judicially determined, applied to the facts put forth by the assessee and requires re-determination.”
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