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TMI Blog2014 (7) TMI 984X X X X Extracts X X X X X X X X Extracts X X X X ..... 0/2014 - FINAL ORDER No. 40405/2014 - Dated:- 18-7-2014 - Shri R. Periasami, J. For the Appellant : Shri M. Ram Mohan Rao, DC (AR), For the Respondent : Shri R. Arumugam, Consultant JUDGEMENT Revenue filed this appeal against the order passed by the Commissioner (Appeals). The issue relates to the clearance of certain capital goods to their sister unit after put into use, on payment of duty on the invoice value instead of depreciated value. The adjudicating authority confirmed differential duty of ₹ 1,07,553/- along with appropriate interest and also imposed equal amount of penalty. The Commissioner (Appeals) allowed the respondents appeal on the ground that the capital goods have been removed as such from the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) ELT 29 (Tri.-LB) 5. CCE, Hyderabad Vs. Navodhaya Plastic Industries Ltd. 2013-TIOL-1773-CESTAT-MAD-LB The Ld. AR submits that the decision of the Hon ble High Court of Madras in the case of CCE, Salem Vs. Rohini Mills Ltd. (supra) discussed the Board s Circular dated 01.07.2002 and CBEC letter dated 26.05.03, and held that used capital goods cleared as such is liable to be assessed on the depreciated value. 3. The Ld. Advocate on behalf of the respondent submits that the Commissioner (Appeals) has rightly allowed their appeal by relying the Tribunal orders in the case of Madura Coats Pvt. Ltd. Vs CCE and Salona Cotspin Ltd. Vs. CCE, Salem. He further submits that Rule 3 (4) is applicable in respect of the capital goods c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... required to reverse credit equivalent to credit taken when used capital goods are removed from the factory or not The Hon ble High Court has held as under:- 5. Though the contention of the learned Standing Counsel appears to be very sound in the first blush, we are not in a position to accede to the said submission. Rule 3(4) (C) of the 2004 Rules reads as under: When inputs or capital goods, on which Cenvat credit has been taken, are removed as such from the factory, the manufacturer of the final products, shall pay an amount equal to the credit availed in respect of such inputs or capital goods and such removal shall be made under the cover of an invoice referred to in Rule 7.1. 6. In the first place, the provision for reversa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ome use over a period of time, then the assessee would be entitled to reverse whatever Cenvat credit availed on the value to be assessed on the date of such subsequent sale of capital goods. Such a conclusion by relying upon the above referred to Board s Circular and the letter as well as the addition of proviso to Rule 3(5) with effect from 13.11.2007, is the manner in which the expression as such used in Rule 3(4) can be interpreted. Consequently, the interpretation put in the order of the Principal Bench reported in 2009 (242) ELT 124 merits acceptance. The order of the Tribunal impugned in this appeal applying the said ratio of the Principal Bench is, therefore, perfectly justified. The Hon ble Madras High Court upheld the Tribunal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e 13 of Cenvat Credit Rules, 2001 read with Section 11 AC of the Central Excise Act, 1944 and Sections 38A of the Central Excise Act, 1944, I find that the Revenue has not put forth any valid grounds on the suppression of facts. The Commissioner (Appeals) has set aside the penalty imposed by the adjudicating authority on account of revenue neutrality, as the impugned used capital goods were cleared to their sister unit. 8. In view of the above discussion, the impugned order is set aside and order passed by the adjudicating authority is restored to the extent of confirmation of demand of duty and interest. The penalty is waived. The appeal filed by the Revenue is allowed partially. (Order pronounced in the open Court on) - - TaxTMI ..... X X X X Extracts X X X X X X X X Extracts X X X X
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