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TMI Blog2014 (2) TMI 634X X X X Extracts X X X X X X X X Extracts X X X X ..... an 50% in the year in which the capital goods have been procured. But in the subsequent year, they are entitled for the said credit. - Therefore, the argument advanced by the AR that they are required to reverse entire credit is not correct. - Levy of interest and penalty amounting to ₹ 5000/- confirmed. - Appeal No.E/3387/06 - Final Order No. A/844/2013-WZB/C-IV(SMB) - Dated:- 11-11-2013 - Mr. Ashok Jindal, J. For the Appellant : Shri B S Meena, Addl. Commissioner (AR) For the Respondent: Shri Rajesh Ostwal, CA JUDGEMENT Per: Ashok Jindal: The brief facts of the case are that the respondent is a manufacturer of audio video CD. During the period 2003-04, the respondent procured capital goods on which duty was p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ore, they have complied with condition of Rule 4(2)(a) and 4(2)(b) of CENVAT Credit Rules, 2002. Therefore, appeal is to be dismissed. 5. Heard both sides. Considered the submission. 6. I have gone through the provisions of Rule 4(2)(a) and 4(2)(b) which are reproduced as under: Rule 4. Conditions for allowing CENVAT Credit:- (1) .. 2) (a) The CENVAT credit in respect of capital goods received in a factory or in the premises of the provider of output service or outside the factory of the manufacturer of the final products for generation of electricity for captive use within the 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 s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ear in which the capital goods have been procured. But in the subsequent year, they are entitled for the said credit. Admittedly, in this case in subsequent year they have not availed any credit on such capital goods. Therefore, the argument advanced by the AR that they are required to reverse entire credit is not correct. As the respondents have taken the credit in advance wrongly which is entitled to take in the subsequent. As the respondent has availed the credit in advance, therefore the respondent are required to pay interest for the intervening period for which they are entitled to take credit. Further, as the respondent has committed an error, therefore they are liable to pay the penalty under Rule 27 of CENVAT Credit Rules (sic). Ac ..... X X X X Extracts X X X X X X X X Extracts X X X X
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