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TMI Blog2011 (11) TMI 761X X X X Extracts X X X X X X X X Extracts X X X X ..... espondent. 3. The brief facts that arise for our consideration are that during the period on 16-12-2003 to 18-12-2003, the respondent-assessee cleared the capital goods on which they have availed the Cenvat credit. The respondent-assessee discharged the duty liability on the said capital goods based upon the value of the capital goods which was indicated on the invoices. Revenue authorities were of the view that the respondent is required to reverse the Cenvat credit availed on such capital goods as the said capital goods were removed as such. Adjudicating authority after following the due process of law, confirmed the demands raised and also imposed penalties on the respondent-assessee and also directed them to pay interest on the am ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e appellants after using them in their factory for a period of about six years. Thus it cannot be held that the capital goods have been removed "as such" by the appellants as envisaged in terms of Rule 3(4) of the Cenvat Credit Rules, 2002. The Board in its Circular F. No. 643/34/2002-CX, dated 1-7-2002 also has clarified at Point No. 14 that with reference to capital goods the duty to be paid will be determined after allowing depreciation in terms of Circular F. No. 495/16/03-CX.VI, dated 26-5-1993. In fact Rule 3(4) of Cenvat Credit Rules, 2002 does not specify that when capital goods are cleared, duty paid should be equal to the amount of credit availed. Cenvat Credit Rules, 2002 have been amended from time to time and the last amendment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hall 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. " 8. We also find strong force in SDR's submission that the issue is now decided by the Larger Bench in the case of Modernova Plastics Pvt. Ltd. (supra) respondent-assessee is required to reverse the Cenvat credit taken on capital goods. Respectfully following the same, we hold that the learned Commissioner (Appeals) order to that extent is incorrect. The demand of the duty of reversal of Cenvat credit and the interest thereof is correct. The order of first appellate authority is modified to that extent. The respondent-assessee is liable to pay interest. The lower ..... X X X X Extracts X X X X X X X X Extracts X X X X
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