2026-VIL-52-CESTAT-CHE-CE
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CENTRAL EXCISE CESTAT Cases

Central Excise - CENVAT credit on Additional Duty of Customs (CVD) – Import of steam coal - The imported steam coal attracted Nil Basic Customs Duty and Additional Duty of Customs (CVD) at the concessional rates of 1% and 2% under Customs Notification No. 12/2012-Cus and No. 12/2013-Cus, respectively. The appellant availed CENVAT credit of the said CVD under Rule 3(1)(vii) of the CENVAT Credit Rules, 2004 – Denial of CENVAT credit on the ground that the concessional excise duty rates on domestic steam coal were subject to the condition of non-availment of CENVAT credit, and the same condition should apply to the CVD paid on imported steam coal as well - Whether CENVAT credit of 1% / 2% CVD paid on imported steam coal is admissible under Rule 3(1)(vii) of the CENVAT Credit Rules, 2004 - HELD - The CENVAT credit of 1% / 2% CVD paid on imported steam coal is admissible under Rule 3(1)(vii) of the CENVAT Credit Rules, 2004. The Rule 3(1)(vii) clearly allows credit of "the additional duty leviable under Section 3 of the Customs Tariff Act", and there is no qualification in the Rule that credit is admissible only if CVD is paid at the tariff rate and not at a concessional rate. The proviso to Rule 3(1)(i), which restricts availment of credit in cases where the benefit of certain central excise exemption notifications is availed, expressly refers only to duties of excise paid under the Central Excise Act and notifications issued thereunder, and does not extend its scope to additional duty of customs paid under the Customs Tariff Act or incorporate customs exemption notifications within its ambit - The CENVAT credit on 1% / 2% CVD paid on imported steam coal under Customs Notification is legally admissible. The denial of CENVAT credit in the impugned Orders-in-Original is set aside and the appeal is allowed
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