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TMI Blog2017 (6) TMI 320X X X X Extracts X X X X X X X X Extracts X X X X ..... reach the stage of finished goods and the input/semi-finished goods destroyed. Therefore, the provision of reversal of CENVAT Credit, which is with reference to Rule 21 in respect of finished goods is not applicable. If the credit at the time of receipt of inputs was availed correctly and legally, recovery of the same in absence of any machinery provisions cannot be made. Appeal allowed - decided in favor of appellant. - E/1401 & 1402/09 - A/87625-87626/17/SMB - Dated:- 30-5-2017 - Shri Ramesh Nair, Member (Judicial) Shri V.M. Doiphode, Advocate for Appellant Shri H.M. Dixit, AC (AR) for Respondent ORDER Per: Ramesh Nair The fact of the case is that there was fire in the appellants factory, wherein raw ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Therefore, the appellants are before me. 2. Shri V.M. Doiphode, learned Counsel appearing on behalf of the appellant submits that the inputs were destroyed in the fire after issue of the same in the production, therefore, the inputs were at the stage of work-in-progress or containing in the semi-finished goods. Therefore, there is no finished goods which was destroyed in the fire. In the case of destruction in fire in respect of inputs, no CENVAT Credit is required to be reversed. He submits that the reversal of CENVAT Credit is required only in case when the remission of duty is sought for by the assessee in respect of the finished goods and not in respect of the input as such or input under process. He further submits that even if it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hri H.M. Dixit, learned Asstt. Commissioner (AR) appearing on behalf of the Revenue reiterates the findings of the impugned order. He further submits that as per the Cenvat Credit Rules, the CENVAT Credit on the inputs can be allowed only when the input is used in the manufacture of final product, which is cleared on payment of duty. In the present case, when the inputs were destroyed in fire, the same was not used in the manufacture and the manufactured goods were not cleared on payment of duty. Therefore, the CENVAT Credit on such destroyed inputs is not admissible. 4. I have carefully considered the submissions made by both sides. I find that the fact more or less is not in dispute that the input on which credit was availed was issued ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the plain reading of the above Rule, the CENVAT Credit can be recovered only in case where the same was availed or utilized wrongly. In the present case, availment of credit at the time of receipt of inputs was absolutely as per law and there was no case of wrong availment of CENVAT Credit. Therefore, in the facts of the present case, recovery of CENVAT Credit cannot be made in terms of Rule 14 of the Cenvat Credit Rules. 4.1 This Tribunal in the case of Suryalaxmi Cotton Mills (supra) has held as under: - 4. We have carefully considered the submissions made by both the sides. We find that at the time of exemption Notification No. 30/2004-C.E. came into effect, there was no provision for reversal of credit in respect of inputs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nnot be accepted. 21. In the light of the aforesaid, we are of the opinion that CENVAT credit which was validly availed at the time of the receipt of the inputs for the manufacture of the final product, on which excise duty was payable, but subsequently utilized for the manufacture of the same final product which became exempted from payment of excise duty pursuant to a subsequent notification, was not liable to be reversed under Rule 6(1) of the Cenvat Credit Rules, 2002. The question of law is answered accordingly. In the case of Tractor Farm Equipment Ltd. - 2015 (320) ELT 357 (Mad.), the Hon'ble High Court of Madras has passed the following order:- 17. The introduction of Rule 11(3) of the Cenvat Credit Rule ..... X X X X Extracts X X X X X X X X Extracts X X X X
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