2018 (10) TMI 694 - AT - Central Excise

CENVAT Credit - denial on the ground that the credit was availed by the assessee after the prescribed period (of six months), being imposed by way of amendment with effect from 01.09.2014 - Held that - It is an admitted position of law that prior to 01.09.2014, there was no such time limit prescribed under the statute - The said period of limitation has further been amended vide Notification No. 06/2015 with the time of one year replacing the time of six months and both the Notifications would cover the period of dispute involved in this case, which is September, 2014 to June, 2015 - it is also not the case of Revenue that the credit was availed after more than one year. The Revenue authorities have erred in denying the benefit of CENVAT Credit - appeal allowed - decided in favor of appellant.

Summary

Issues:
1. Demand of duty under Rule 14 of CENVAT Credit Rules, 2004 along with interest and penalty.
2. Credit availed on invoices beyond prescribed period.
3. Interpretation of the place of service under Rule 2(l) of CENVAT Credit Rules, 2004.
4. Refusal of first appellate authority to entertain the appeal.
5. Denial of CENVAT Credit based on availing credit after the prescribed period.

Analysis:

1. The Appellant received a Show Cause Notice proposing a demand of duty under Rule 14 of CENVAT Credit Rules, 2004, along with interest and penalty. The Appellant contested the proposals, but the adjudicating authority confirmed the demands in an Order-in-Original.

2. The Revenue claimed that the Appellant had taken credit on certain invoices after the prescribed period of six months, as per an amendment to Rule 4 of the CENVAT Credit Rules, 2004. The Appellant's appeal was based on the argument that the credit was availed within the time limit prescribed by a subsequent notification.

3. The adjudicating authority interpreted the place of service under Rule 2(l) of CENVAT Credit Rules, 2004 to mean the factory gate and not the customer's place. This interpretation was a point of contention in the appeal.

4. The first appellate authority refused to entertain the appeal of the Appellant against the Order-in-Original, leading the Appellant to file an appeal before the Appellate Tribunal.

5. The Tribunal, after considering the arguments and relevant notifications, found that the denial of CENVAT Credit was solely based on availing the credit after the prescribed period. The Tribunal referred to a similar case decided by the Mumbai Bench where it was held that availing credit within one year from the date of issue of documents falls within the time limit prescribed by a specific notification. Based on this reasoning, the Tribunal set aside the impugned Order and allowed the appeal, granting consequential benefits to the Appellant.