Order Date: 01 June 2022

Facts-

• The Respondent, M/s. ABB Limited is engaged in the manufacturing and clearance of turbo chargers, electric motor, transformer etc. 
• A Show Cause Notice was issued to the Respondent alleging that apart from manufacturing, the Respondent was also engaged in trading of electrical goods and had wrongly utilized CENVAT credit in relation to the trading activity.
• The Appellant, Chief Commissioner of Customs, has passed Order in Original by extending the limitation period, holding that, CENVAT credit availed by the Respondent is inadmissible. Further directions were issued for appropriation in the CENVAT account paid under protest.
• CESTAT held that there was no suppression of facts and it confirmed the demand only for normal period. The penalty relating to normal period was also set-aside during the relevant period on the ground that there was much confusion with regard to the availment of credit. 
• Being aggrieved by the order of CESTAT,  the Appellant filed this appeal.

Issue-

• Whether extended period of limitation can be invoked on the trading activities of the Respondent?

Order-

• The Hon’ble High Court observed that SCN was issued on the basis of balance sheet and the trading activities of the Respondent was mentioned on the balance sheet. Thus, the contentions of the Revenue that respondents trading activity was not known to the department and that it was learnt based on intelligence report are not tenable. The Court further relied on the case of Shriram value Services Pvt. Ltd. (Madras High Court)
• The Court further held that, the alleged suppression of facts on the part of the Respondent are not tenable, when the same was in the knowledge of the Appellant in the form of balance sheet wherein, all activities of the Respondent were declared, which was available with the Appellant for inferring the trading activities of the Respondent.
• Hence the appeal filed by revenue is dismissed and substantial questions are answered against revenue.