2017 (10) TMI 1296 - AT - Central Excise

Remission of duty - CENVAT credit - whether the Appellant is required to reverse the credit availed on inputs used in the production on the semi-finished goods which were destroyed in fire? Held that - the remission from duty as prescribed under Rule 21 of CER 2002 is applicable to finished goods and not to semi-finished goods - Besides the incident of fire took place in the month of August 2007 hence it is covered by the decision of of Hon ble Gujarat High Court in the case of C.C.E. & Cus Ahmedabad II vs. Intas Pharmaceutcals Limited. 2013 (4) TMI 532 - GUJARAT HIGH COURT where it was held that for input credited earlier there is no scope of reversal of the credit if the finished product becomes unfit for human consumption unless any condition has been imposed for remission of duty in terms of Rule 21 of the Central Excise Rules 2002 making it clear that the credit already taken is to be reversed. Appeal allowed - decided in favor of appellant.

Summary

The Appellate Tribunal CESTAT AHMEDABAD ruled that the Appellant is not required to reverse the credit availed on inputs used in the production of semi-finished goods destroyed in a fire. The decision was based on the applicability of Rule 21 of CER, 2002 and a previous judgment of the Hon'ble Gujarat High Court. The impugned order was set aside, and the Appeal was allowed with consequential relief.