2012 (11) TMI 769 - AT - Central Excise

Waiver of pre-deposit - reversal of cenvat credit along with interest and penalty - denial of cenvat credit to the appellant on the special additional duty on the imported goods alleged that appellant had taken the cenvat credit and special additional duty paid in the month of December 2008, January 2009 and February 2009 which is beyond the period of one year and hence as per the provisions of Rule 4 of Cenvat Credit Rules Held that - Provisions of Rule 4(1) of Cenvat Credit Rules, talks about availment of credit, immediately, on receipt of the inputs and it is his submission that there is no dispute regarding the receipt of the duty paid inputs - in the case of SGS India Pvt. Ltd. (2011 (3) TMI 759 - CESTAT, MUMBAI ) prima-facie cover the issue in favour of the assessee - pre-deposit waived

Summary

Issues:
- Denial of cenvat credit on imported goods
- Interpretation of Rule 4 of Cenvat Credit Rules
- Applicability of recent Tribunal judgments

Analysis:

1. The primary issue in this case revolves around the denial of cenvat credit to the appellant on special additional duty paid on imported goods during a specific period. The Revenue contends that the appellant took the credit for duty paid in months beyond the permissible one-year period, thus rendering them ineligible under Rule 4 of the Cenvat Credit Rules.

2. The appellant's counsel argues that Rule 4(1) of the Cenvat Credit Rules mandates immediate availment of credit upon receipt of inputs, emphasizing that the receipt of duty paid inputs is undisputed. Reference is made to a recent Tribunal judgment in the case of SGS India Pvt. Ltd. v. C.C.E. Thane-I to support this contention.

3. On the other hand, the learned SDR relies on a previous Tribunal decision in the case of Mold-Tek Technologies Ltd., which established a one-year timeframe for claiming cenvat credit as reasonable. Despite this, a thorough review of the records reveals no dispute regarding the receipt and consumption of duty paid inputs by the appellant.

4. Upon examining the facts, the Tribunal finds that the appellant has established a prima facie case for the waiver of the pre-deposit concerning the disputed amounts. Notably, the Tribunal acknowledges the relevance of the judgment in the case of SGS India Pvt. Ltd. in favor of the appellant, indicating a potential favorable outcome for the assessee.

5. Consequently, the Tribunal grants the application for the waiver of the pre-deposit and stays the recovery of the disputed amounts until the appeal is disposed of. This decision is based on the absence of disagreement regarding the receipt and utilization of duty paid inputs, aligning with the provisions of Rule 4 of the Cenvat Credit Rules and pertinent Tribunal precedents.

6. In conclusion, the Tribunal's ruling favors the appellant by acknowledging the prima facie validity of their case for the waiver of pre-deposit, highlighting the importance of timely credit availment and the interpretation of relevant legal provisions and precedents in determining cenvat credit eligibility.