2008 (9) TMI 700 - AT - Central Excise

Summary

Issues:
Whether an assessee under the Compounded Levy Scheme was eligible to avail deemed Cenvat credit on clearances subsequent to a specific date.

Analysis:
The appeal revolved around the eligibility of an assessee under the Compounded Levy Scheme to avail deemed Cenvat credit on clearances post a particular date. The Tribunal deliberated on the provisions of Rule 96ZNB (5) in conjunction with Rule 57AK of the Central Excise Rules 1944 and para 4A of Notification No. 7/2001-C.E., dated 1-3-2001 as amended by Notification No. 17/2001-C.E., dated 30-4-2001. The Tribunal noted that the specific provisions stated that manufacturers availing of the special procedure under Rule 96ZNA were not entitled to avail of any credit of duty paid on inputs or capital goods. The Tribunal emphasized that the reliance on sub-clause (5) of Rule 96ZNB by the assessee did not support their case, as it was clarified that such credits were not applicable under Rule 96ZNB. Furthermore, the Tribunal highlighted the clauses specifying the applicability of the rules to goods manufactured before or after a specific date, reinforcing the ineligibility of the assessee to claim the deemed Cenvat credit.

The Tribunal, after considering the arguments presented, upheld the impugned order that set aside the erroneous refund of deemed Cenvat credit amounting to Rs. 5,73,294. Consequently, the appeal was rejected, affirming the decision that the assessee was not entitled to the deemed Cenvat credit as claimed. The judgment was pronounced in court on 9-9-2008.