2018 (11) TMI 1019 - AT - Central Excise

CENVAT Credit - time limitation - it was alleged that appellant had wrongly availed credit to the tune of ₹ 21,35,493/- beyond the time limit of six months / one year in contravention of Rule 4(1) of CENVAT Credit Rules, 2004 - Held that - The assessee has to avail credit on the invoices within a period of six months /one year from the date of issue of the invoices / documents - In the present case, it is seen that all the invoices are issued even prior to 11.7.2014. The department has issued the show cause notice on the wrong interpretation of the provisions that credit has been availed by the appellant after 11.7.2014. The amended provision has no retrospective effect. Demand cannot sustain - appeal allowed - decided in favor of appellant.

Summary

Issues:
- Availment of CENVAT credit beyond time limit under Rule 4(1) of CENVAT Credit Rules, 2004.

Detailed Analysis:

Issue 1: Availment of CENVAT credit beyond time limit under Rule 4(1) of CENVAT Credit Rules, 2004
The case involved the appellant, engaged in manufacturing MS bars and billets, availing CENVAT credit on inputs, capital goods, and input services. An audit revealed that the appellant had wrongly availed credit amounting to ?21,35,493 beyond the time limit of six months/one year as per Rule 4(1) of CENVAT Credit Rules, 2004. The show cause notice was issued, and after due process, the demand was confirmed by the original authority and upheld by the Commissioner (Appeals), leading to the appeal before the tribunal.

In defense, the appellant's counsel argued that the law regarding credit availment was amended through notifications in July 2014 and March 2015, setting time limits for availing credit. The appellant contended that since all invoices were dated before September 2014, when the time limit came into effect, the credit availed was correct. The appellant cited precedents like Voss Exotech Automotive Pvt. Ltd. and others to support their argument.

The respondent, represented by the ld. AR, supported the findings of the impugned order, stating that the credit was rightly disallowed as it was availed after September 2014 when the amended provision came into effect.

After hearing both sides, the tribunal analyzed whether the appellant was eligible to avail credit on invoices issued before July 2014 and September 2014, as per the notifications. The tribunal referred to the case of Voss Exotech Automotive Pvt. Ltd., where it was held that the amended provision should apply to invoices issued after the notification dates. The tribunal concluded that the department's interpretation was incorrect, and the appellant was entitled to the credit as the amended provision had no retrospective effect. Consequently, the tribunal set aside the impugned order and allowed the appeal with any consequential relief.

In conclusion, the tribunal's decision clarified the applicability of the time limits for availing CENVAT credit under Rule 4(1) of the CENVAT Credit Rules, 2004, based on the specific dates of the invoices and the relevant notifications, providing relief to the appellant in this case.