9911796707
TMI Blog2011 (8) TMI 666X X X X Extracts X X X X X X X X Extracts X X X X ..... usheela, Advocates. For Appellants Shri V Sridharan, Advocates For Respondent JUDGEMENT The Revenue has preferred this appeal challenging the order passed by the Tribunal holding that the assessee is entitled for the transfer of unutilized credit to the tune of Rs.15,85,47,475/-. The assessee M/s.Hewlett Packard Sales Private Ltd., is EHTP Unit functioning under 100% EOU scheme manufacturing personal computers and another their unit in Pondicherry in the name of Hewlett Packard India Private Limited., for manufacture of computers and printers. The Pondicherry unit availed input credit for the manufacture of computers and printers. There was amalgamation of the Pondicherry unit with the assessee unit at Bangalore vide order dated 28-5-2004 of the High Court of Karnataka. The Pondicherry unit stopped production with effect from October, 2004 onwards. They transferred the unutilized credit to the Bangalore Unit. On the direction of the Department the credit taken was reversed. Thereafter the assessee submitted a letter dated 28-12-2005 to the Pondicherry authorities and requested for permission to transfer the available Cenvat credit balance of Rs.15,85,47,475/- to their Ba ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dit is not available. As the instant case does not come within Rule 11(2) the appellate Commissioner was in total error in denying the benefit of Rule 11(c) to the assessee. Therefore the Tribunal held that the appellant was entitled to the benefit of transfer of utilization of unutilized Cenvat credit in terms of sub-Rule 91) of Rule 11. Aggrieved by the said order the present appeal is filed. 2. This appeal was admitted to consider the following questions of law:- "a) Whether the Tribunal was right in holding that Respondent herein are rightly entitled for the transfer of unutilized credit to the tune of Rs.15,85,47,475/- which is not permissible under Rule 10(3) of CENVAT Credit Rules,. (b) Whether the Tribunal was right in holding that for transfer of credit to an amalgamated unit, no prior permission is required under this provision. As long as the input, and capital goods are accounted to the satisfaction of the department, the credit is transferable". 3. The learned counsel appearing for the Revenue assailing the impugned order contended that the assessee is claiming exemption from payment of excise duty by virtue of a Notification dated 9-7-2004. Once such exemption ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of are duly accounted for to the satisfaction of the Deputy Commissioner of Central Excise or, as the case may be, the Assistant Commissioner of Central Excise." Sub-Rule (1) of Rule 10 categorically declares the legal position. It states that when any manufacturer of final products shifts his factory to another site or the factory is transferred on account of change in ownership or on account of sale, merger or amalgamation or transfer of the factory or joint venture with the specific provision for transfer of liabilities on such factories, then the manufacturer shall be allowed to transfer the Cenvat credit lying unutilized in his accounts to such transfereed sold, merged, leased or amalgamated factory. Therefore, the law provides for transfer of unutilized Cenvat credit, in the event of an amalgamation in favour of the transferor Company. Rule 11 deals with Transitional provision which reads as under:- "(1) Any amount of credit earned by a manufacturer under the CENVAT Credit Rules, 2002, as they existed prior to the 10th day of September, 2004 or by a provider of output service under the Service Tax Credit Rules, 2002, as they existed prior to the 10th day of September, 20 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hapters 9 to 96.- In exercise of the powers conferred by subsection (1) of section 5A of the Central Excise Act, 1944 (1 of 1944), the Central Government, being, satisfied that it is necessary in the public interest so to do, hereby exempts excisable goods of the description specified in column (3) of the Table below or specified in column (3) of the said Table read with the concerned List appended hereto, as the case may be, and falling within the Chapter, heading No. or sub-heading No. of the First Schedule to the Central Excise Tariff Act, 1985 (5 of 1986)(hereinafter referred to as the Central Excise Tariff Act), specified in the corresponding entry in column (2) of the said Table,- (a) from so much of the duty of excise specified thereon under the First. Schedule (hereinafter referred to as the First Schedule) to the Central Excise Tariff Act, as is in excess of the amount calculated at the rate specified in the corresponding entry in column(4) of the said Table; and (b) from so much of the Special duty of excise leviable thereon under the Second Schedule (hereinafter referred to as the Second Schedule) to the Central Excise Tariff Act, as is in excess of the amount calc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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