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2017 (1) TMI 149 - AT - Central ExciseCENVAT credit - MS angle, flat etc - The assessee availed cenvat credit items which are similar to the final products manufactured by them - Held that - It is a fact that the entire cenvat credit availed by the assessee already stands reversed at the time of clearance of the goods as such. In such Revenue neutral scenario, we find no reason to interfere with the impugned order - credit allowed - appeal rejected - decided against Revenue.
Issues:
Dispute over admissibility of cenvat credit on goods similar to final products manufactured by the assessee. Analysis: The appeal was filed by the Revenue against the Order-in-Appeal passed by the Commissioner (Appeals), Raipur. The assessee, engaged in manufacturing iron and steel goods, availed cenvat credit on input and capital goods under Cenvat Credit Rules. The dispute arose regarding the admissibility of cenvat credit on goods like MS angle, flat, etc., which were cleared as such on payment of duty. The Revenue contended that cenvat credit on such goods was inadmissible since the assessee manufactured similar products. A show cause notice was issued, disallowing the credit, which was confirmed by the original authority. However, the Commissioner (Appeals) set aside the order, leading the Revenue to appeal for reinstating the Order-in-Original. During the hearing, the Revenue argued that goods similar to the final products manufactured by the assessee should not be considered as inputs for availing cenvat credit. Nonetheless, it was acknowledged that the goods in question had been cleared as such from the factory with the availed cenvat credit being reversed at that time. The Commissioner (Appeals) noted the compliance with Rule 3(5) of Cenvat Credit Rules, 2004, where the manufacturer can trade inputs under certain conditions. The Commissioner's decision was based on the fact that the entire cenvat credit had been reversed at the time of clearance, resulting in a revenue-neutral situation. The Tribunal upheld the findings of the Commissioner (Appeals), emphasizing that the cenvat credit had already been reversed upon clearance of the goods. In light of this, the Tribunal found no grounds to interfere with the impugned order and dismissed the Revenue's appeal. The judgment was pronounced in open court on 29/11/2016.
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