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2014 (2) TMI 583 - AT - Central ExciseExemption under Notification No. 56/2002-CE dated 14/11/2002 - Reversal of CENVAT Credit - Held that - We have perused the Notification 56/2002-CE and the conditions prescribed therein for availing of exemption by way of refund, reversal of refund wrongly availed, submission of statement, determination by the jurisdictional Assistant Commissioner of the refund due to the appellant and so on. As per these conditions, the appellant is required to reverse the credit of the excess amount taken within 5 days from the date of date of determination by the Assistant Commissioner. In the instant case, the determination by the Assistant Commissioner was vide order dated 02/04/2012 whereas the appellant had reversed the excess credit taken in July, 2011 itself. Therefore, in terms of the conditions of sub-para 2C, the appellant is not prima facie liable to pay any interest nor the appellant liable to any penalty. Therefore, the appellant has made out a strong case in their favour for grant of stay - Stay granted.
Issues:
1. Eligibility for duty exemption and refund mechanism under Notification No. 56/2002-CE. 2. Availing excess credit, reversal, determination by excise authorities, and consequences. 3. Appeal against the order of the lower appellate authority. 4. Interpretation of conditions for availing exemption and reversal of excess credit. 5. Grant of stay application. Analysis: Issue 1: Eligibility for duty exemption and refund mechanism under Notification No. 56/2002-CE The appellant, M/s. Lupin Ltd., had a unit in Jammu & Kashmir eligible for duty exemption under Notification No. 56/2002-CE. The notification provided for a refund mechanism for eligible amounts, which required the appellant to take suo motu refund within a specific timeframe and submit a detailed statement to the jurisdictional Assistant Commissioner. Issue 2: Availing excess credit, reversal, determination by excise authorities, and consequences The appellant availed excess credit of Rs.1,35,920/- in April 2011, which was later reversed on 07/07/2011. The excise authorities determined the excess credit only by an order dated 02/04/2012. The appellant argued that they had reversed the excess credit before the determination, thus questioning the imposition of interest and penalty as per the provisions of the Notification. Issue 3: Appeal against the order of the lower appellate authority The appellant, aggrieved by the order of the lower appellate authority, filed an appeal seeking relief from the interest and penalty imposed by the excise authorities for availing excess credit. Issue 4: Interpretation of conditions for availing exemption and reversal of excess credit The Tribunal analyzed the conditions prescribed in Notification 56/2002-CE regarding the reversal of excess credit within 5 days from the date of determination by the Assistant Commissioner. As the excess credit was reversed before the determination, the Tribunal found that the appellant was not liable to pay interest or penalty as per the conditions of the notification. Issue 5: Grant of stay application Considering the submissions and the notification's provisions, the Tribunal granted a waiver from pre-deposit of the dues adjudged against the appellant and stayed the recovery during the appeal's pendency, as the appellant had a strong case in their favor based on the interpretation of the notification's conditions.
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