9911796707
TMI Blog2012 (11) TMI 203X X X X Extracts X X X X X X X X Extracts X X X X ..... oviso to sub rule 5 of Rule 3 of the Cenvat Credit Rules is brought in to play by 31.03.04, the entire cenvat credit taken by the appellant would be 'nil'. This would mean that the appellant is not required to reverse any cenvat credit, if the appellant removes the capital goods on which cenvat credit is taken and is in use, after the ten years of its use in his factory premises. Thus finding strong force on the contentions raised by the ld. counsel assessee and also find it from records that when the appellant cleared the said capital goods on 18.03.09, he had specifically mentioned that it is "old and used forged hammer, capacity 3 ton". If that be so, the question of reversal of cenvat credit taken on the said capital goods will not aris ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Rs.1,70,980/-. Therefore, the Show-Cause Notice dated 04.10.10 was issued to the, appellant for (i) demanding Central Excise duty amounting to Rs. 1,70,980/- under Section 11A(1) of the Central Excise Act, 1944 (ii) demanding interest at appropriate rates under Section 11AB of the Act and (iii) imposition of penalty under Rule 25 of the Central Excise Rules, 2002 read with Section 11AC of the Central Excise Act, 1944. The Adjudicating Authority vide the OIO dated 17.01.2011 confirmed the charges framed in the show cause notice and (i) confirmed the duty demand amounting to Rs.1,70,980/- under Section 11A(1) of Central Excise Act, 1944 and ordered recovery of the same from the appellant; (ii) ordered for recovery of interest at appropriate r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... date the cenvat credit availed by the appellant would be 'nil' on the said capital goods. 5. Ld. DR would reiterate the first appellate authority as well as the adjudicating authority's findings and submit that the appellant had not given the proof before the first appellate authority as to the present market value of the goods and any evidences in support of his contention. 6. We have considered the submissions made by both sides and perused the records. 7. The issue involved in this case is whether the appellant is required to reverse the cenvat credit availed by the appellant on the forged hammer of 3 ton capacity while removing the same on 18.03.09. It is undisputed that the appellant had received/purchased these capital goods on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... acturer or provider of output service shall pay an amount equal to the cenvat credit taken on the said capital goods reduced by 2.5 per cent for each quarter of a year or part thereof from the date of taking the cenvat credit.] 1[(5A) if the capital goods are cleared as waste and scrap, the manufacturer shall pay an amount equal to the duty leviable on transaction value.] 2[(5B)............. 3[(5C)............. " 9. It can be seen from the above reproduced provisions and more specifically, the second proviso to sub rule 5 of Rule 3 of the Cenvat Credit Rules, 2004, that the statutorily it is provided that the capital goods, if they are removed after being used, manufacturer shall pay an amount equivalent to the cenvat cr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ions has to be applied on the date of clearance of the capital goods. It is undisputed that on the date of clearance of the capital goods from the factory premises of the appellant i.e. on 18.3.09, the provisions of second proviso to sub rule 5 of Rule 3 was in existence which would necessarily be applied and that the cenvat credit taken by the appellant in 1994, is exhausted on records as per statute itself, on completion of ten years of use of capital goods. In our considered view, the impugned order is incorrect and not sustainable, on the face of the legal provisions in the Cenvat Credit Rules, 2004. 11. Accordingly, we hold that the impugned order is liable to be set aside and we do so. 12. The impugned order is set aside and the a ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
