Relief to Hyundai Motors: CESTAT quashes Central Excise Demand after 10 Years [Read Order]

The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Chennai held that the adjudication for non-reversal of CENVAT credit issued to Hyundai Motors India Ltd ten years after its show-cause notice (SCN) as time-barred.

The department found errors in the CENVAT claimed by Hyundai and demanded a non-reversal as per Rule 9 of CENVAT Credit Rules 2004. The SCN was issued for the recovery of Rs.5,63,42,519/- and its reply was filed in 2012, yet the adjudication took place in 2022- after a delay of 10 years. The appellant claims to have paid an amount in excess of the credit availed, but no proof to substantiate was available due to the time lag.

The claimed extension for the period of limitation does not hold as the SCN did not allege that the appellant has suppressed any facts with intent to evade payment of duty. The department failed to find any legitimate proof for the same. The learned counsel Shri S. Muthuvenkataraman for the appellant brings into light the case of Kaur & Singh v. CCE, New Delhi to support his argument. He also points out the violation of natural justice in this delay and mentions the case of Bombay Dyeing v. Deputy commissioner of CGST where the High Court held that “ It is not expected from the assessee to preserve the evidence/ record for such long periods….such long delay lets the assessee be under the expectation that the reply has been received and accepted by the department”.

Ms. Sridevi Taritla, ADC(AR) appeared for the respondent and Justice Sulekha Beevi C.S. in light of the evidence and facts, allowed Hyundai Motors appeal with consequential reliefs.

To Read the full text of the Order CLICK HERE

Support our journalism by subscribing to Taxscan AdFree. Follow us on Telegram for quick updates.