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TMI Blog2006 (4) TMI 437X X X X Extracts X X X X X X X X Extracts X X X X ..... al in the case of Hindustan Lever Ltd. v. CCE - 2004 (172) E.L.T. 167 (Tri. - Mum) has inter alia held as under :- 2. Briefly the facts are that the appellant was availing of credit of Cenvat on capital goods under Cenvat Credit Rules, 2001/2002. The appellant availed of the Cenvat based on duty paying documents in their favour on capital goods, i.e. NSD pre-plodder type falling under subheading 8479.19 CETA. The appellant availed of the entire credit of duty (100%) on the capital goods (Rs. 1,94,124/-) instead of 50% of such duty as was provided under Rule 4(2)(A) of Cenvat Rules, 2001. The appellant took such credit on 25-7-2001 but transferred the goods by preparing a Central Excise Invoice No. 4475, dated 29-9-2001 in favour of their ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rred the capital goods in question to another unit of his own. Thus, the provisions of the Rule, in this given situation, would have resulted in taking only 50% of credit of the duty paid on the capital goods even though duty was paid in full on the capital goods. The intention of the legislature could not have been to defeat the object of the Cenvat Rules. 6. The above Rule underwent a change w.e.f. 1-3-2002. Proviso to Rule 4(2) of the Cenvat Rules, 2002 reads as follows : - Provided that the Cenvat credit in respect of capital goods shall be allowed for the whole amount of the duty paid on such capital goods in the same financial year if the said capital goods are cleared as such in the same financial year. 7. The impugned goods, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f capital goods in its factory. On clearance of the said goods as such, to its group company, i.e., Ispat Metallics India Ltd., the Department directed the respondent to pay 100% of the credit it was entitled to, even though it had availed only 50% as provided in Rule 57AC. Respondent submits that the issue as to what amount should be paid at the time of removal of capital goods as such now been settled by the decision of the Larger Bench of the Tribunal in the case Eicher Tractors Ltd. v. CCE - 2005 (189) E.L.T. 131 (Tri.-LB) wherein the LB held that what was required to be paid at the time of clearance of capital goods, as such, was only an amount equal to credit availed. In the instant case, insistence of department, respondent had to pa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o sub Rule 2 to Rule 4 of the Cenvat Credit Rules, 2002 which is reproduced as under :- 2(a) The CENVAT credit in respect of capital goods received in a factory at any point of time in a given financial year shall be taken only for an amount not exceeding fifty per cent of the duty paid on such capital goods in the same financial year. Provided that the CENVAT credit in respect of capital goods shall be allowed for the whole amount of the duty paid on such capital goods in the financial year if the said capital goods are cleared as such in the same financial year. 5. Thus, after hearing, perusal of the records and provisions of sub Rule of Rule 2 as above along with proviso thereto, I find that the Revenue s case is devoid of merits ..... X X X X Extracts X X X X X X X X Extracts X X X X
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