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2015 (12) TMI 1595 - AT - Central ExciseValue determination for cenvat credit - payment of duty at the rate applicable at the time of clearance in terms of Rule 3(4) of Cenvat Credit Rules, 2002 - whether word used in Rule 3(4) of Cenvat Credit Rules, 2002 is such goods and not said goods - Held that - We find the provision of sub-rule (4) of Rule 3 and the subsequent clarifications of the Board are very clear. The amount of duty on the goods cleared as such on which Cenvat credit was availed earlier by the manufacturer will be governed by the said Rules. We do not find any reason to interpret such goods or said goods in this situation. The goods on which credit has been availed has been cleared as such and duty applicable on the date of such clearance has been paid. We find no ground to interfere with the impugned order. Accordingly the appeal filed by the Revenue is dismissed.
Issues: Interpretation of Rule 3(4) of Cenvat Credit Rules, 2002 regarding payment of duty on goods cleared after availing credit.
Analysis: 1. The appeal by Revenue challenged an order of the Commissioner (Appeals) related to the payment of Central Excise duty by the respondents, who were engaged in manufacturing Organic Chemicals and availing Cenvat credit on inputs. The dispute arose when it was alleged that the respondents paid a lesser amount of duty than the credit availed on certain cleared inputs. 2. The Revenue contended that as per a Board Circular, duty credit on goods should be reversed or paid back upon clearance. They argued that the term "such goods" in Rule 3(4) of the Cenvat Credit Rules, 2002 should be strictly interpreted, implying that the respondents paid duty at a lower rate than required. 3. In response, the respondent's Counsel argued that Rule 3(4) and the Board's clarifications did not leave any ambiguity. The rule mandates payment of duty equal to the excise duty leviable on the goods at the applicable rate and value upon clearance. 4. The Tribunal, after considering both arguments and reviewing the records, found the rule and clarifications to be unambiguous. It concluded that duty on goods cleared after availing credit should adhere to the rules, without necessitating a distinction between "such goods" and "said goods." As the duty applicable on the date of clearance had been paid, the Tribunal upheld the Commissioner (Appeals) order, dismissing the Revenue's appeal.
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