2017 (2) TMI 207 - AT - Central Excise

Cenvat credit - input or capital goods - Held that - I find that the details were submitted by the appellants before the Original Authority in the form of Annexure - D & Annexure - G to the reply dated 27/03/2008 to the said Show Cause Notice - I therefore remand the matter to the Original Authority with a direction to him to examine the submissions in form of Annexure - D & Annexure - G annexed to reply dated 27/03/2008 to the said Show Cause Notice and also take into consideration the submission before him that the credit of ₹ 8,63,764/- was already reversed and decide the issue afresh after giving opportunity of hearing to the appellant - Appeal allowed by way of remand.

Issues:
1. Admissibility of Cenvat credit on 'inputs' and 'capital goods'
2. Disallowance of Cenvat credit by the Original Authority
3. Appeal against the Order-in-Appeal No. 98/CE/ALLD/2010
4. Submission of details through Annexure - D & Annexure - G
5. Consideration of debited entry in respect of Cenvat credit

Admissibility of Cenvat credit on 'inputs' and 'capital goods':
The appellants, engaged in manufacturing A.C. Sheets, were issued a Show Cause Notice alleging inadmissible Cenvat credit on 'inputs' and 'capital goods'. The Original Authority disallowed the credit, stating the items manufactured were not capital goods as per the Central Excise Tariff Act, 1985. The appellants contended that the items qualified as capital goods, submitting details through Annexure - G and Annexure - D. The Commissioner (Appeals) upheld the Original Authority's decision, leading to the appeal before the Tribunal.

Disallowance of Cenvat credit by the Original Authority:
The Original Authority did not appreciate the submissions made by the appellants regarding the admissibility of Cenvat credit on 'inputs' and 'capital goods'. Despite the appellants providing details through Annexure - D & Annexure - G, the Original Authority held that the manufactured items did not meet the criteria of capital goods, leading to the disallowance of the credit. The appellants argued that the Original Authority failed to consider the debited entry related to Cenvat credit, which was crucial for the decision.

Appeal against the Order-in-Appeal No. 98/CE/ALLD/2010:
The appellants appealed to the Tribunal against the Order-in-Appeal No. 98/CE/ALLD/2010, where the Commissioner (Appeals) upheld the decision of the Original Authority. The Tribunal, after hearing both parties, remanded the matter back to the Original Authority. The Tribunal directed the Original Authority to re-examine the submissions made through Annexure - D & Annexure - G, consider the reversed credit amount, and provide an opportunity for the appellants to be heard before making a fresh decision.

Submission of details through Annexure - D & Annexure - G:
The appellants submitted detailed information through Annexure - D & Annexure - G in response to the Show Cause Notice. These documents contained essential details regarding the items falling under Chapter 72 & 73 and the capital goods manufactured by the appellants. Despite the submission of these details, the Original Authority did not consider them adequately, leading to the appeal before the Tribunal.

Consideration of debited entry in respect of Cenvat credit:
The appellants raised the issue of a debited entry related to Cenvat credit, which the Original Authority did not take into account while making the decision to disallow the credit. The appellants argued that this debited entry was significant and should have been considered in the assessment of the admissibility of the Cenvat credit. The Tribunal, after considering all arguments, allowed the appeal by way of remand for a fresh decision by the Original Authority.

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