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TMI Blog2017 (12) TMI 316X X X X Extracts X X X X X X X X Extracts X X X X ..... herefore such capital goods and input lying in the joint venture premises is liable for payment of duty in accordance with Rule 3(5) Cenvat Credit Rules, 2004. Accordingly, demand of duty was raised. In the first round this Tribunal has remanded the matter only for correct quantification of the demand. In denovo adjudication after determined the correct duty liability adjudicating authority confirmed the demand of Rs. 25,42,117/- as against Rs. 1,24,06,867/- as proposed in the show cause notice. Being aggrieved by the said denovo adjudication order appellant is before me. 2. Shri. Rajesh Ostwal, Ld. Counsel for the appellant submits that capital goods and input on which credit was availed were very much available in the same premises and used in the manufacture of dutiable goods. The provision of Rule 3(5) is applicable only when the goods is removed from the factory. In the present case admittedly goods were lying in the factory premises, therefore even if there is creation of new joint venture but there is no removal of goods. He placed reliance on the following judgments: (a) CCE Vs. M/s. Hindustan Lever Ltd[2015-TIOL-966-CESTAT-MUM] (b) L.G. Balakrishnan & Bros., Ltd Vs. C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed to a new legal entity. The dispute is on the Cenvat credit reversal of inputs/capital goods as well as excise duty payment on the finished product. 8. The excise duty liable to the appellant on the finished goods and work-in-progress is considered first. It is the case of the appellant that there is no physical removal of these goods. On transfer of Chain Division, M/s. RCIPL, came in custody and ownership of these goods and have duly discharged appropriate duty on these items. The assertion of the appellant has been acknowledged by the original authority also. M/s. RCIPL vide their letter dated 20-7-2010 have stated that they have taken inventory of all items including work-in-progress and finished goods in their books of account as on 1-10-2008 and have paid appropriate duty on such goods. The said declaration of M/s. RCIPL has been supported by certificate dated 17-7-2010 of Chartered Accountants to the effect that the finished goods cleared from the factory of M/s. RCIPL have suffered applicable excise duty. We notice that this factual position as asserted by the appellant have not been rebutted by the original authority in any finding. Though, excise liability arises imme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... served, in passing, that certain goods have been transferred by lorry. This has been categorically countered by the appellant stating that the transfer of capital goods with reference to other two establishments are mixed-up with the present case by the original authority. Even the demand in the present proceedings do not relate to other Units of the appellant and insofar a Gudalur Unit is concerned, there is no physical removal of either capital goods or raw materials at the time of sale and transfer of Chain Division. We find the central point to be considered for application of the abovementioned rule is whether or not the inputs or capital goods on which Cenvat credit has been taken are removed as such from the factory of the appellant. The Hon'ble Supreme Court in the case of J.K. Spinning and Weaving Mills Ltd. & Anr. (supra) examined the scope of 'term removal'. It was held that there can be no doubt that the word removal contemplates shifting of a thing from one place to another. In other words, it contemplates physical movement of goods from one place to another. The Tribunal in Dalmia Cements (Bharat) Ltd. v. Commissioner of Central Excise, Tiruchirapalli reported ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ke the deeming fiction as insisted by the adjudicating authority. The language of Rule 3(5) is plain and simple. When the inputs or capital goods on which cenvat credit has been taken are removed as such from the factory, then subject to compliance of other requirements, the credit availed in respect of inputs on capital goods shall be paid. This situation has not arisen in the present case, as no invoice has been issued for removal of the goods from the factory premises and, therefore, the said rule is not applicable to the case of the assessee. 18. The above is the view succinctly expressed by the Allahabad High Court in Hero Motors case (supra). This Court is in agreement with the view expressed by the Allahabad High Court in the above-cited decision and the above decision is squarely applicable to the facts of the present case. In view of the above, the interpretation with regard to Rule 3(5) of CCR, 2004, as made by the Tribunal in the present case is fully justified and it calls for no interference at the hands of this Court." 10. In view of the above settled decision, we find that the provisions of Rule 3(5) are not attracted in the present case. The original authority&# ..... X X X X Extracts X X X X X X X X Extracts X X X X
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