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TMI Blog2016 (9) TMI 626X X X X Extracts X X X X X X X X Extracts X X X X ..... vat Credit. They opted to avail exemption under notification 30/2004-CE dated 09.07.2004 w.e.f. from 03.08.2004. One of the conditions in this notification was that no credit on duty on inputs shall be taken under Cenvat Credit Rules. 2. Transitional provisions in Cenvat Credit Rules, 2004 were introduced through provisions of Rule 11(3) vide notification 10//2007-CE (NT) dated 01.03.07. In terms of these provisions, the appellant reversed an amount of Rs. 1,33,01,111 towards inputs lying in or contained in the final product lying in stock which was consequent upon avoiding the exemption as per notification 30/2004 CE dated 09.07.2004. However, they carried forward a balance to the tune of Rs. 19,38,200/- in their cenvat credit account and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ufacturer of the said final product and is lying in stock or in process or is contained in the final product lying in stock, if- (i) he opts for exemption from whole of the duty of excise leviable on the said final product manufactured or produced by him under a notification issued under section 5A of the Act; or (ii) The said final product has been exempted absolutely under section 5A of the Act, and after deducting the said amount from the balance of Cenvat Credit, if any, lying in his credit, the balance, if any, still remaining shall lapse and shall not be allowed to be utilized for payment of duty on any other final product whether cleared for home consumption or for export, or for payment of service tax on any output service, whet ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he decision of Hon'ble high Court of Karnataka in the case of Commissioner of C. Ex. Vs. Gokldas Intimate Wear (Supra). We have gone through the said citation, we find that in the above case the Hon'ble High Court of Karnataka had occasion to examine an identical issue and held as follows: "4. This Court in the case of the Commissioner Central Excise v. M/s. TAFE Limited (Tractor Division) disposed off on 1st March 2011 [2011 (268) E.L.T. 49 (Kar.)] after referring to the various judgments held that once the input credit is legally taken and utilized on the duitable final product, it need not be reversed on the final product being exempted subsequently. Only if any products are purchased subsequent to the said exemption and if any ta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Act; or (ii) the said final product has been exempted absolutely under section 5A of the Act, and after deducting the said amount from the balance of CENVAT credit, if any, lying in his credit, the balance, if any, still remaining shall lapse and shall not be allowed to be utilized for payment of duty on any other final product whether cleared for home consumption or for export, or for payment of service tax on any output service, whether provided in India or exported." 6. Therefore, it is clear from the aforesaid. Rule that till 1-3-2007, the assessee was entitled to benefit, of the cenvat credit in respect of inputs contained in the work in progress and semi finished products. The said amendment is pro ..... X X X X Extracts X X X X X X X X Extracts X X X X
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