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TMI Blog2017 (11) TMI 767X X X X Extracts X X X X X X X X Extracts X X X X ..... s written off from the books of accounts, whereas in the present case, the inputs after being used and contained in the semi finished goods destroyed in fire during the course of its journey to the final stage, hence cannot be equated to the activity of written off of the credit on said inputs - appeal allowed - decided in favor of appellant. - E/10351/2017-SM - A/13309/2017 - Dated:- 31-10-2017 - Dr. D. M. Misra, Member (Judicial) For the Appellant : Mr. R.V. Shetty (Advocate) For the Respondent : Mr. L.Patra (A. R.) ORDER Per: Dr. D. M. Misra This is an appeal filed against order-in-appeal No.VAD-EXCUS-001-425/2016 passed by the Commissioner (Appeals-I), Central Excise, Customs and Service Tax, Vadodara-I. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... were destroyed in fire, which yet to attain the stage of finished goods, therefore, the provisions of sub-Rule (5B) cannot be invoked; since remission of duty could not be requested on the semi finished goods under Rule 21 of the Central Excise Rules, 2002. Therefore, the inputs which were used in the WIP goods destroyed in fire cannot be directed to be reversed. In support he has referred to the judgments of this Tribunal in the case of Themis Meidcare Ltd. Vs CCE ST Daman - 2014 (303) ELT 141 (Tri. Amd). He has further categorically submitted that even though compensation had been received from the Insurance Company on destruction of WIP goods, which was net of excise duty element on the inputs used in the said WIP goods, however, b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Ld. Advocate for the Appellant. This Tribunal has considered similar issues arose for the period after amendment to Rule 3 of the Cenvat Credit Rules,2004 inserting sub-rule (5C) relating to reversal of credit on inputs when remission of duty was allowed on the finished goods destroyed in fire. The contention of the Revenue that the appellant is required to reverse the credit on the inputs contained in semi- finished goods in accordance with Rule 3(5B) of Cenvat Credit Rules, 2004, in my view, is an erroneous approach and misreading of sub Rule 5B of Cenvat Credit Rules, 2004, inasmuch as, the said sub Rule is directed when the inputs or capital goods before being put to use is written off from the books of accounts, whereas in the pres ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... first appellate authority which is that the appellant had been compensated by the insurance agencies even for the duty paid on inputs. I find that this reasoning which has been given by the ld. first appellate authority seems to be at variance of the law as has been settled by the Hon ble High Court of Karnataka in the case of Tata Advanced Materials Ltd. (supra), wherein in paragraph No.6 their Lordship's has recorded as under : Therefore, it is 6. clear that there is no provision in the rules which provides for a reversal of the credit by the Excise Authorities except where it has been irregularly taken in which event it stands cancelled or if utilised has to be paid for. This is not the case of the Revenue. In the instant cas ..... X X X X Extracts X X X X X X X X Extracts X X X X
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