2010 (11) TMI 910 - AT - Central Excise

Summary

Issues involved: Challenge to denial of Cenvat Credit on depreciation of capital goods for the period August 2004 to June 2005.

Summary:

Issue 1: Denial of Cenvat Credit

The appellant challenged the denial of Cenvat Credit availed on depreciation of capital goods. The department contended that the appellant had claimed depreciation on the capital goods and also availed Cenvat credit on the same. The lower authorities denied the credit stating that mere intimation to the income tax authorities was not sufficient, and a revised return was required, which the appellant failed to file. The demand was confirmed against the appellant based on this. The appellant appealed to the Tribunal against this decision.

Issue 2: Appeal Arguments

The appellant's advocate argued that the income tax department had assessed the appellant's income by increasing the depreciation amount in their income for the relevant period, as the appellant had intimated that they were not claiming depreciation on the capital goods. The advocate presented the assessment order showing the increased income due to the added depreciation. It was contended that the impugned order should be set aside based on this evidence.

Issue 3: Tribunal Decision

After hearing both sides, the Tribunal considered the intimation under Section 143(1) of the Income Tax Act, which showed that the appellant's income had been increased by adding depreciation on capital goods. The Tribunal held that the appellant had reversed the depreciation claim and had not availed the depreciation during the relevant period. Consequently, the Tribunal allowed the appeal, set aside the impugned order, and granted the appellant the right to claim Cenvat credit on the capital goods. The stay application was also disposed of accordingly.

This summary provides a detailed overview of the issues involved, the arguments presented, and the Tribunal's decision in the case regarding the denial of Cenvat Credit on depreciation of capital goods.