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TMI Blog2017 (3) TMI 1137X X X X Extracts X X X X X X X X Extracts X X X X ..... laid down in Rule 2 (k) of CCR, 2004 - credit allowed. Interest - Held that: - The appellant has taken Cenvat credit wrongly/ inadvertently or on account of clerical errors / short receipt of material etc. though the same was reversed later - considering the Hon’ble Supreme Court’s decision in the case of Ind-Swift Laboratories [2011 (2) TMI 6 - Supreme Court], the interest on the Cenvat credit amount for the period, when it was lying in the account of the assessee, is liable to be paid - the matter is remanded to the original adjudicating authority who shall decide the issue of amount of interest. Appeal allowed - part matter on remand for quantification - decided in favor of assessee. X X X X Extracts X X X X X X X X Extracts X X X X ..... /2015 dated 9.9.2015 and A/52103/2016 dated 6.6.2016, allowed them benefit of Cenvat credit. Further following the Hon'ble Apex Court's decisions in the case of CCE Vs. Jawahar Mills Ltd. - 2001 (132) ELT 3 (SC) and CCE Vs. Rajasthan Spinning & Weaving Mills Ltd. - 2010 (255) ELT 481 (SC), the appellant is entitled to Cenvat credit for the subject inputs. Therefore, the impugned orders are modified to this extent and the appeal in this regard is partly allowed. 4. The appellant has another issue of 'liability of interest' on the inadmissible Cenvat credit amount for the period when the same was lying in their account, though not utilised, and later reversed. The appellant is arguing that they have not utilised the Cenvat credit though it w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed later. The issue is that for certain period i.e. till the said wrong Cenvat credit amount was reversed, it was in the assessee's Cenvat account like some money lies in one's bank's account though it is not withdrawn or used/spent by the account holder, and may be Bank may also give interest on the same. Here this credit has been taken by the assessee themselves, though may be inadvertently or on account of clerical error etc. The Hon'ble Supreme Court in the case of Ind-Swift Laboratories (supra) has analysed in detail the provisions of Rule 14 of Cenvat Credit Rules whereunder the recovery of Cenvat credit along with interest is made. The Hon'ble Supreme Court in the said decision inter alia observes as under : 15. In order to apprecia ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urt on a conjoint reading of Section 11AB of the Act and Rules 3 & 4 of the Credit Rules proceeded to hold that interest cannot be claimed from the date of wrong availment of CENVAT credit and that the interest would be payable from the date CENVAT credit is wrongly utilized. In our considered opinion, the High Court misread and misinterpreted the aforesaid Rule 14 and wrongly read it down without properly appreciating the scope and limitation thereof. A statutory provision is generally read down in order to save the said provision from being declared unconstitutional or illegal. Rule 14 specifically provides that where CENVAT credit has been taken or utilized wrongly or has been erroneously refunded, the same along with interest would be r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sions in the statutes so as to supply any assumed deficiency." 20. Therefore, the attempt of the High Court to read down the provision by way of substituting the word ÖR" by an "AND" so as to give relief to the assessee is found to be erroneous. In that regard the submission of the counsel for the appellant is well-founded that once the said credit is taken the beneficiary is at liberty to utilize the same, immediately thereafter, subject to the Credit rules.". (emphasis supplied) 6.1 Hon'ble Madras High Court in the case of CCE, Chennai-IV Vs. Sundaram Fasteners Ltd. (supra) following the decision of Hon'ble Apex Court in the case of Ind-Swift Laboratories Ltd. (supra) hold that reversal of credit would not amount to "no credit" ha ..... X X X X Extracts X X X X X X X X Extracts X X X X
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