9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2022 (12) TMI 134 - AT - Central ExciseCENVAT Credit - dutiable as well as exempted goods by using cenvated inputs - reversal of 6% of the value of exempted goods in terms of Rule 6(3) of Cenvat Credit Rules, 2004 - Whether after such compliance, there is any contravention of condition of Notification No. 30/2004-CE dated 09.07.2004 which in order to avail it, stipulates that assessee should not avail Cenvat credit? HELD THAT - From the above sub-rule (3D) of Rule 6, it is clear that even though assessee availed Cenvat credit but in compliance of Rule 6(3), they reversed the credit which will amount to non-availment of credit. With this statutory provision once the appellant complied with the provision of Rule 6(3) by reversing the credit, the condition of the notification automatically stand met. Therefore, it cannot be said that the appellant have violated the condition of notification. Since the penalty is consequential to demand in the present case and the said demand is not sustainable, the penalty on the appellant is also not sustainable. Hence there is no merit in the Revenue s appeal. Appeal allowed - decided in favor of appellant.
Issues involved:
Whether the appellant is entitled to exemption under Notification No. 30/2004-CE despite availing Cenvat credit on inputs and subsequently reversing 6% of the value of exempted goods in compliance with Rule 6(3) of Cenvat Credit Rules, 2004. Detailed Analysis: 1. Issue of Entitlement to Exemption: The Adjudicating Authority denied the appellant's claim for exemption under Notification No. 30/2004-CE, stating that availing Cenvat credit on inputs contravened the notification's condition. The appellant argued that by reversing 6% of the value of exempted goods in compliance with Rule 6(3), the condition of the notification was satisfied. The Tribunal referred to sub-rule (3D) of Rule 6, which deems payment under Rule 6(3) as non-availment of credit for the purpose of an exemption notification. The Tribunal relied on previous decisions, including Vineet Polyfab Pvt. Limited, to support the appellant's position. 2. Interpretation of Statutory Provisions: The Tribunal analyzed the statutory provisions, emphasizing that compliance with Rule 6(3) by reversing the credit amounted to non-availment of credit as per sub-rule (3D). The Tribunal cited the case of Spentex Industries Limited, where it was held that payment under Rule 6(3) made the assessee eligible for claiming exemption under Notification No. 30/2004-CE. The Tribunal highlighted the importance of sub-rule (3D) in meeting the conditions of the notification. 3. Application of Precedent: The Tribunal applied the precedent set by previous decisions, such as Life Long Appliances Ltd., and emphasized the significance of sub-rule (3D) in determining eligibility for exemption. The Tribunal noted that the department had accepted the decision in Vineet Polyfab Pvt. Limited, further supporting the appellant's position. The Tribunal concluded that once the amount under Rule 6(3) was paid, the condition of the notification was deemed to be complied with. 4. Decision and Outcome: Based on the above analysis and the precedent set by previous cases, the Tribunal ruled in favor of the appellant, setting aside the demand for denying exemption under Notification No. 30/2004-CE. Consequently, the penalty imposed on the appellant was also deemed unsustainable due to the lack of merit in the Revenue's appeal. The impugned orders were set aside, the assessee's appeal was allowed, and the Revenue's appeal was dismissed. This detailed analysis of the judgment highlights the legal interpretation of statutory provisions, application of precedent, and the ultimate decision reached by the Appellate Tribunal CESTAT AHMEDABAD in the case concerning entitlement to exemption under Notification No. 30/2004-CE.
|
