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2015 (12) TMI 796 - AT - Central ExciseDenial of CENVAT Credit - Whether Cenvat Credit is entitled to the respondent on the strength of the invoices issued by M/s. MPEL in respect of Unpolished Granite Blocks or not - Held that - it is not rebutted by the Revenue without the evidence that M/s. MPEL has not taken any process in the factory of the respondent. Therefore, M/s. MPEL has made the goods usable to the respondent and on that process of making usable M/s. MPEL has paid duty which is not in dispute. Therefore, as per Rule 3 of the Cenvat Credit Rules 2004 whatever input / capital goods have been received by the respondent in their factory they are entitled to take Cenvat Credit, it is immaterial that whether the impugned goods attract duty or not, when there is no dispute that these goods have suffered duty. The said view has been affirmed by the Hon ble High Court of P&H in the case of Ranbaxy Labs Ltd. 2006 (7) TMI 216 - HIGH COURT OF PUNJAB & HARYANA AT CHANDIGARH and in the case of CEGAT. Therefore, I hold that respondent has taken Cenvat Credit correctly. - No infirmity with the impugned order - Decided against Revenue.
Issues:
1. Entitlement to Cenvat Credit on duty paid by another entity. 2. Classification of goods for the purpose of Cenvat Credit eligibility. Analysis: 1. The case involved a dispute regarding the entitlement of the respondent to Cenvat Credit on duty paid by M/s. MPEL on "Unpolished Granite Blocks." The Revenue contended that since M/s. MPEL was not required to pay duty on these goods, the respondent should not be allowed to claim Cenvat Credit. However, the respondent argued that they had paid duty on the inputs received and were entitled to take credit, citing legal precedents where courts upheld the right to claim credit on duty actually paid by the assessee. The tribunal noted that M/s. MPEL had processed the goods in a manner that made them usable by the respondent, and since duty had been paid on these goods, the respondent could rightfully claim Cenvat Credit under Rule 3 of the Cenvat Credit Rules 2004. The tribunal relied on the decisions of the High Court to support its ruling and held in favor of the respondent, dismissing the Revenue's appeal. 2. The Revenue raised an objection stating that the matter should be heard by a Division Bench as it related to the classification of the product. However, the tribunal found that the issue at hand was solely about the entitlement of Cenvat Credit based on the invoices issued by M/s. MPEL and not about classification. Therefore, the tribunal concluded that the matter could be heard by a single-member bench. This decision was supported by the fact that the show cause notice did not raise any issue regarding classification, further solidifying the tribunal's stance on the jurisdiction of the bench to hear the case. In conclusion, the tribunal upheld the respondent's right to claim Cenvat Credit on duty paid by M/s. MPEL, emphasizing that the crucial factor was the payment of duty on the inputs received, regardless of whether the goods attracted duty or not. The decision was based on legal principles and precedents supporting the right of the respondent to claim credit on duty actually paid, ultimately leading to the dismissal of the Revenue's appeal.
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