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TMI Blog2011 (10) TMI 284X X X X Extracts X X X X X X X X Extracts X X X X ..... d subsequently destroyed due to fire accident. Thus, there was no provision in the law at the relevant time for reversal of CENVAT credit availed on capital goods if the same were destroyed due to natural calamities. - case decided in favour of assessee. - E/1815/10 - MUM - A/408/2011-WZB/C-IV(SMB) - Dated:- 10-10-2011 - Shri. P.R. Chandrasekharan, J. Appearance Shri Vinod Awtani, C.A for Appellant Shri V.K. Aggarwal, Addl. Commissioner (A.R.) for Respondents Per :- P.R. Chandrasekharan The appeal and stay application are directed against order-in-appeal No. PKS/204/BEL/2010 dated 27.07.10 passed by the Commissioner of Central Excise (Appeals), Mumbai III. 2. The facts arising for consideration in this case are ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e revised demand of Rs.4,53,278/- arrived at by taking the value of the capital goods at Rs.27,77,437/- which was the amount received from the insurance company on account of loss of capital goods. The appellant are before me against the impugned order. 3. The learned Counsel for the appellant submits that the capital goods were destroyed in flood which occurred on 26th July, 2005 and this fact had been intimated to the department at the relevant time. The capital goods were in use by the appellant and one of the capital goods was purchased on 02.03.2001 and was in use for a period of more than four years and another capital goods was purchased in 2004 and was in use for more than a year when the loss took place. Therefore, they have n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... estroyed and if the goods are sold as waste and scrap, only the value received for such sale should be considered for payment of duty. In the light of these submissions the Counsel prays for waiver of pre-deposit. 4. The learned A.R for the Revenue reiterated the findings given by the lower appellate and the adjudicating authority. 5. I have considered the rival submissions. As the issue lies in a narrow compass, after granting stay, I take up the appeal itself for disposal. 6. In the instant case, there is no dispute that the capital goods were put to use and when the goods were in use, the floods happened and the capital goods were damaged and they could not be put to use. In as much as the capital goods became waste and scrap, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he depreciation method, provision for determining the value of capital goods when cleared after usage was introduced in the CENVAT Credit Rules, 2004 by a Notification No. 39/2007-CE (N.T) dated 13.11.2007. In the instant case, the damage occurred in 2005 and the capital goods were cleared as waste and scrap in 2006. At the relevant time there was no provision based on the depreciation method. Therefore, the order passed by the adjudicating authority is also untenable in law. Further this Tribunal in the case of Motor Industries Co. Ltd. cited (supra) held that where the capital goods became waste and scrap by use over time and in case where such goods became waste and scrap because of fire accident, there was no provision for making propor ..... X X X X Extracts X X X X X X X X Extracts X X X X
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