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TMI Blog2016 (10) TMI 34X X X X Extracts X X X X X X X X Extracts X X X X ..... shall be exempt from the whole of the duty of excise leviable thereon. Held that:- it is found that the definition of an input given in Rule 2(k) of CENVAT Credit Rules, 2004 cannot restrict the entitlement, when they are taking CENVAT credit in terms of Notification No.22/2003 dated 31.3.2003. More so, when the decisions of the Tribunal viz., Hindustan Unilever Ltd. vs. CCE, Bhavnagar [2009 (7) TMI 605 - CESTAT, AHMEDABAD] and CCE vs. Jagmini Micro Knit Pvt. Ltd. [2008 (11) TMI 169 - CESTAT, NEW DELHI] make it clear that appellants as an EOU can claim CENVAT credit for the duty paid on HSD oil used as fuel and when they are eligible to avail the benefit of the said Notification. Therefore, the Revenue's contention that in terms of def ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... clarified that EOUs could receive goods on payment of duty and take CENVAT Credit of the duty paid thereon. In the light of the above clarification, the Appellants started procuring HSD on payment of duty and availed CENVAT Credit of the duty paid thereon. * The appellants procured HSD falling under Chapter Sub heading No. 27101930 of the Central Excise Tariff Act, 1985 on payment of duty. The Appellants availed CENVAT Credit of the duty so paid on HSD and the same was reflected in the ER 2 returns. * The appellants further submit that Department issues them periodical show-cause notices proposing to disallow CENVAT credit and recall the CENVAT credit taken by the appellants on the HSD on the ground HSD is specifically excluded from t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... inly argue against the orders confirming the demand and imposing penalties inter alia as follows: i. The facility of Cenvat Credit was extended to EOUs w.e.f. 06.09.2004 vide Notificaiton No. 18/2004-CE(NT) dated 06.09.2004 which amended Rule 17 of the Central Excise Rules, 2002 to enable EOUs to pay duty on clearances made to DTA by utilizing Cenvat Credit. The amended provision made it clear that the Appellants are entitled to avail Cenvat Credit and utilise the same towards payment of duty. In view of the above, the Appellants became eligible to avail Cenvat Credit of the duty paid on inputs and to utilize the same for payment of duty on clearances made to DTA. ii. Rule 2(k) of the Cenvat Credit Rules, 2004 provided that goods used ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l CENVAT Credit of the duty paid on High Speed Diesel Oil. The Appellate Tribunal observed that since the assessee is a 100% EOU, the Notification makes them entitled to take Credit. vi. The Appellants further submit that it is always the legislative intent that duty incidence on procurements of EOU be Nil. Here the EOU procures HSD on payment of duty, the supplier is extended deemed export drawback in terms of Para 8.3 of the FTP. Therefore, where the supplier has not availed the deemed export drawback, the EOU would be entitled to avail CENVAT Credit of the duty paid on HSD and utilise the same towards payment of duty in terms of Rule 17 of the Central Excise Rules or claim refund of the unutilised Credit. vii. In view of the above, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pinners vs. UOI: 2011 (266) E.L.T. 145 (S.C.) (ii) Imperial Granites (P) Ltd. vs. CCE, Guntur: 2012 (276) E.L.T. 174 (AP) (iii) Imperial Granites P. Ltd. vs. CCE, Guntur: 2010 (256) E.L.T. 610 (Tri.-Bang.) 5. We have carefully considered the full facts of the case and submissions of both the sides and the case laws cited. 6.1 The main issue concerns with the CENVAT credit taken by the appellants who are a 100% EOU. The Revenue s contention is that appellant is not entitled to take CENVAT credit as the definition of input given in Rule 2(k) excludes light diesel oil and high speed diesel oil or motor spirit. The appellant on the other hand cites the Notification No.22/2003-CE dated 31.3.2003 saying that as a 100% EOU they are ent ..... X X X X Extracts X X X X X X X X Extracts X X X X
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