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2012 (9) TMI 106 - AT - Central ExciseReversal of CENVAT Credit availed of the Central Excise duty paid on capital goods as well as input services - Held that - As the provisions of Rule 11 (3) of CENVAT Credit Rules, 2004 specifically provides for only reversal of CENVAT Credit taken on the duty paid on the inputs and the said rule is silent about the reversal of CENVAT Credit taken of Central Excise duty paid on capital goods as well as on the Service Tax paid on the input services - the appellant has made out a prima facie case for waiver of pre-deposit of balance amounts involved in this case - in favour of assessee.
Issues:
Waiver of pre-deposit of CENVAT Credit, interest, and penalty under CENVAT Credit Rules, 2004. Analysis: The appellant filed a Stay Petition seeking waiver of pre-deposit of CENVAT Credit, interest, and penalty imposed under the CENVAT Credit Rules, 2004. The adjudicating authority confirmed the amounts to be reversed due to availing exemption for export products. The appellant argued that the CENVAT Credit availed on duty paid on inputs in stock or work in progress had already been reversed. The remaining balance sought to be reversed pertained to Central Excise duty on capital goods and Service Tax on input services, not covered under Rule 11 of the CENVAT Credit Rules, 2004. The Department reiterated the authority's findings, but the Tribunal noted that Rule 11 only mandated reversal of CENVAT Credit on duty paid on inputs, not on capital goods or input services. Therefore, the Tribunal found that Rule 11 could not be invoked for the balance amount not yet reversed, as it was related to Central Excise duty on capital goods and Service Tax on input services. The Tribunal, after considering both sides' submissions, held that the appellant had a prima facie case for waiver of pre-deposit of the balance amounts involved. The Tribunal observed that Rule 11 of the CENVAT Credit Rules, 2004 did not cover the reversal of CENVAT Credit on Central Excise duty paid on capital goods and Service Tax on input services. Therefore, the application for waiver of pre-deposit of the balance amounts was allowed, and the recovery was stayed pending the appeal's disposal.
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