IN THE CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL EASTERN ZONAL BENCH: KOLKATA REGIONAL BENCH – COURT NO. 1 (Arising out of Order-in-Original No. COMMR/BBSR/CE/01-02/2018 dated 12.12.2017, issued on 09.01.2018, passed by the Commissioner of Goods and Services Tax, Central Excise and Customs, Bhubaneswar, C.R. Building, Rajaswa Vihar, Bhubaneswar – 751 007, Odisha)

M/s. Mideast Integrated Steels Limited : Appellant Khurunti, Jajpur Road, District: Jajpur – 755 026, Odisha VERSUS Commissioner of C.G.S.T. and Central Excise : Respondent Bhubaneswar Commissionerate, C.R. Building, Rajaswa Vihar, Bhubaneswar – 751 007, Odisha APPEARANCE:

Shri Kishor K. Acharya, Advocate, Shri Narendra Kr. Dash, Advocate, For the Appellant Ms. Suman, Authorized Representative, For the Respondent CORAM:

HON’BLE SHRI ASHOK JINDAL, MEMBER (JUDICIAL)

HON’BLE SHRI K. ANPAZHAKAN, MEMBER (TECHNICAL)

FINAL ORDER NO. 75059 / 2026 DATE OF HEARING: 11.12.2025 DATE OF DECISION: 14.01.2026 ORDER: [PER SHRI K. ANPAZHAKAN]

M/s. Mideast Integrated Steels Limited, Khurunti, Jajpur Road, District: Jajpur – 755 026, Odisha [hereinafter referred to as the “appellant”] was a 100% Export Oriented Unit (EOU). The appellant obtained in-principle exit from the Development Commissioner, Falta Special Economic Zone vide ‘In- principle’ Exit Order No. 2(1)M-4/2008/4547 dated 07.02.2012 and finally, de-bonded their 100% EOU vide letter No. 2(1)M4/2008/2691 dated 18.10.2012. The appellant paid central excise duty amounting to Rs.10,38,38,180/- vide Challan Nos. 50040 to 50048 dated 28.07.2012 against capital goods and stock of finished goods viz., pig iron and slag, which were lying in the EOU.

2. Out of the total duty paid by the appellant, central excise duty amounting to Rs.3,53,54,625/- (inclusive of cess) paid by them at the time of exiting their EOU vide Challan Nos. 50043, 50044, 50045 and 50046 dated 28.07.2012 pertained to finished goods i.e., pig iron and slag, which the appellant availed CENVAT Credit of, as ‘inputs’, vide Entry No. 25 dated 31.07.2012. Further, during August, 2012, as per the Entry No. 157 dated 17.08.2012, credit of excise duty amounting to Rs.1,07,43,400/- was also availed by the appellant on finished goods. Therefore, totally, the appellant had availed CENVAT Credit amounting to Rs.4,60,98,025/- during the months of July, 2012 and August, 2012.

3. The Departmental officers were of the view that the CENVAT Credit scheme does not allow availment of input credit of duty paid on their own finished products and accordingly, Show Cause Notices were issued to the appellant proposing to deny the CENVAT Credit availed by the appellant on their own finished goods as ‘inputs’.

4. After due process, the said Show Cause Notices were adjudicated by the Ld. Commissioner of G.S.T., Central Excise and Customs, Bhubaneswar vide Order-in-Original No. COMMR/BBSR/CE/01-02/2018 dated 12.12.2017, issued on 09.01.2018 (hereinafter referred to as the “impugned order”) wherein the Ld. Commissioner has disallowed CENVAT Credit of Rs.4,60,98,025/- and ordered recovery of the same, along with imposed; the ld. adjudicating authority also imposed a penalty of Rs.4,60,98,025/- on the appellant under Rule 15(2) of the CENVAT Credit Rules, 2004 read with Section 11AC of the Central Excise Act, 1944.

4.1. Aggrieved by the denial of CENVAT Credit, along with interest and imposition of penalty thereon, the appellant has filed this appeal.

5. The appellant’s submission is that there is no provision in the CENVAT Credit Rules to deny the CENVAT Credit of duty paid on finished goods at the time of debonding of the 100% EOU. It is their contention that the ld. adjudicating authority has not cited any specific provision in the CENVAT Credit Rules for denial of such credit. In support of their contention that CENVAT Credit is allowable in respect of duty paid at the time of debonding of a 100% EOU, the appellant relied upon the following decisions: -

i. Commissioner of C.Ex., Pune v. Rajdhan