2010 (9) TMI 261 - AT - Central Excise

Cenvat credit - availed of the final product which were cleared on payment of concessional rate of duty as well as under full exemption - Assessee debited the entire modvat credit attributable to the raw material used in the manufacture of their final product cleared free of duty in terms of Notification No.30/04 - Held that - dispense with the condition of pre-deposit of dues, allow the stay petition, set aside the impugned order and remand the matter to Commissioner

Summary

Issues:
1. Denial of benefit of Notification No.30/04-CE due to availing modvat credit.
2. Interpretation of law regarding satisfaction of conditions of notification.
3. Retrospective amendment under Section 72 of the Finance Act, 2010.
4. Setting aside the demand based on credit reversal.

Analysis:
1. The appellant's demand was confirmed by denying the benefit of Notification No.30/04-CE for availing modvat credit on raw materials used in final product manufacture. The appellant argued they debited the modvat credit for goods cleared free of duty under the notification. Citing legal precedents like Chandrapur Magnet Wires case, the appellant contended that debiting cenvat credit post-clearance fulfills notification conditions.

2. The appellant also mentioned the retrospective amendment in Section 72 of the Finance Act, 2010. They expressed intent to apply to the Commissioner for setting aside the demand, stating the credit reversal. Considering this, the tribunal waived the pre-deposit condition, allowed the stay petition, set aside the impugned order, and remanded the matter to the Commissioner for necessary actions.

3. The tribunal, led by Member (J) Mrs. Archana Wadhwa, noted the appellant's submission regarding the retrospective amendment and its impact on the case. By dispensing with the pre-deposit requirement and remanding the matter, the tribunal provided an opportunity for the appellant to address the demand issue in light of the credit reversal.

4. The judgment, pronounced in court, reflected the tribunal's decision to dispose of the stay petition and appeal in the manner outlined above. The legal arguments, reliance on precedents, and consideration of the retrospective amendment were pivotal in the tribunal's decision-making process, ensuring fairness and adherence to legal principles in resolving the dispute.