2010 (9) TMI 1031 - AT - Central Excise

Summary

Issues involved: Appeal against confirmation of demand, interest, and penalty u/s Rule 12B of the Central Excise Rules, 2002 for denial of Cenvat credit.

Summary:
The appellant, a merchant manufacturer, appealed against the denial of Cenvat credit due to no longer being registered u/s Rule 12B. The appellant cleared cotton grey fabrics on duty payment partly from PLA account and Cenvat credit. The denial of Cenvat credit was upheld by lower authorities.

The appellant argued that the case is similar to CCE, Pune v. Keetex, where the Tribunal held the exercise as revenue neutral. Citing relevant cases, the appellant contended that demand is not applicable when there is no revenue implication. The learned DR referenced Jay Yuhshin Ltd. v. Commissioner of Central Excise, New Delhi, emphasizing the need for a revenue neutral situation for credit availability.

After hearing both sides, the Member (J) found the case law cited by the DR not applicable. The Member noted the difference in facts, stating that the appellant's case is akin to Keetex, where demand was not justified due to a revenue neutral scenario. The Member highlighted that the appellant's procurement of goods and reversal of credit from PLA Account resulted in a revenue neutral situation. The appeal was allowed, setting aside the impugned order.

(Separate Judgment by Judge: None)