2020 (11) TMI 544 - AT - Central Excise

CENVAT Credit - input services used for the Repair and Maintenance Service, etc of wind mills located far away from the factory - applicability of Rule 6(1) of Cenvat Credit Rules, 2004 - HELD THAT - The explanation inserted to Notification No. 6/2015- CE (NT) dated 01.03.2015 come in to play if the appellant sold the electricity generated the appellant s counsel has confirmed that they never sold electricity generated from the wind mill - In the present case, appellant have never sold any electricity generated from the wind mill to anybody and , therefore, they are not hit by the mischief Rule 6(1) of CENVAT Credit Rules, 2004. Appeal allowed - decided in favor of appellant.

Summary

Issues:
Denial of Cenvat credit on services used for Repair and Maintenance Service of wind mills located far away from the factory.

Analysis:
The appeals were filed against the denial of Cenvat credit on services used for the Repair and Maintenance Service of wind mills situated far from the factory. The appellant's counsel argued that the issue was covered by a previous Tribunal decision in their own case dated 16.10.2017. However, the Revenue pointed out that amendments to the Cenvat Credit Rules had been made since that decision, specifically mentioning the insertion of an explanation under Rule 6(1) of the CENVAT Credit Rules,2004 through Notification No. 6/2015-CE(NT) dated 01.03.2015. This explanation clarified the treatment of exempted goods or final products, including nonexcisable goods cleared for a consideration from the factory. The Revenue contended that due to these legal changes, the previous decision in the appellant's case could not be followed.

The appellant's counsel strongly emphasized that they had never sold any electricity generated from the wind mill to anyone, thereby asserting that they were not affected by Rule 6(1) of the Cenvat Credit Rule, 2004. The Member (Technical) considered the Revenue's submission and noted that the explanation introduced by Notification No. 6/2015- CE (NT) dated 01.03.2015 would be relevant if the appellant had sold the electricity generated from the wind mill. As the appellant's counsel confirmed that no electricity was sold, the facts of the case remained unchanged, and the previous order in the appellant's case was deemed a valid precedent.

Based on the Tribunal's decision in the appellant's own case under similar circumstances, where it was established that no electricity generated from the wind mill was sold, the impugned order was set aside, and the appeals were allowed.