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TMI Blog2018 (10) TMI 1368X X X X Extracts X X X X X X X X Extracts X X X X ..... ts etc. is not merely procedural, that inputs cleared as such by such DTA assessee to 100% EOU cannot be deemed to have been manufactured by them, hence such assessee was not entitled to remove the inputs without reversal of credit or payment of equivalent amount of duty - the said decision is overturned by Hon’ble High Court of Karnataka in CCE Bangalore Vs Solectron Centum Electronics Ltd. [2014 (10) TMI 596 - KARNATAKA HIGH COURT], where it was held that credit could not be denied on the ground that the EHTP unit concern was not procuring the excisable goods directly from the factory of manufacturer or warehouse. The provisions and conditionalities of Rule 3 (5) ibid will apply to both ‘inputs’ and ‘capital goods’, unless otherwise qu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n such monitors while clearing them to the 100% EOU / STP units. Proceedings initiated against the appellants culminated in order dt. 23.11.2007 which inter alia ordered recovery / reversal of an amount of ₹ 7,63,997/- with interest thereon and also imposing penalty of ₹ 75,000/- under Rule 15 (1) of CCR, 2004. In appeal, the Commissioner (Appeals) vide impugned order dt. 11.09.2009 relying upon the decision of the Tribunal s Larger Bench in the case of Lakshmi Automatic Loom Works Ltd. Vs CCE Trichy 2008 (232) ELT 428 (Tri.-LB) upheld the order of original authority and rejected the appeal. Hence the appellants are before this forum. 2. The matter had been heard earlier also by this Tribunal on 25.09.2017 when it was broug ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Centum Electronics Ltd. in C.E.A No.49 of 2009 decided on 11.06.2014 and reported in 2014 (309) ELT 479 (Kar.) and the High Court has inter alia, held that credit could not be denied on the ground that the EHTP unit concern was not procuring the excisable goods directly from the factory of manufacturer or warehouse. Ld.Counsel further submits that the Solectron Centum Electronics judgement of the High Court would have the effect of overturning the Tribunal s Larger Bench decision in Lakshmi Automatic Loom Works Ltd. (supra). 4. On the other hand, Ld. A.R Shri S. Govindarajan supports the impugned order relying upon the Tribunal s LB decision in Lakshmi Automatic Loom Works Ltd. (supra). He submits that the Tribunal s Larger Bench dec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Hon ble High Court of Karnataka by the Hon. Apex Court to decide the case in the light of the judgment of the Larger Bench of the Tribunal in Lakshmi Automatic Loom Works Ltd. We find in paras 7 8 that the Hon ble High Court of Karnataka has analyzed the applicability of the said Tribunal s Larger Bench decision in Lakshmi Automatic Loom Works Ltd. (supra). No doubt, as the Ld. A.R pointed out, the High Court in the Solectron Centum Electronics judgement considered the requirement or otherwise or reversal of availed cenvat credit in respect of capital goods removed from the DTA to an EHTP unit. All the same, we find that the same relevant provisions in CCR 2004 namely Rule 3 (5) were applicable during the period of dispute in this ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it, the Cenvat credit availed was reversed. It is because, if the assessee had purchased those inputs for its EHTP unit by virtue of aforesaid Notification, there was no duty payable, as the said inputs were removed with the previous permission of the department as reflected in CT-3. There was no liability to pay the duty and already Cenvat credit had been taken, it was reversed under protest and therefore, they were entitled to the refund of the said amount. That question is also answered in favour of the assessee and against the Revenue. 6.4 Viewed in this light, we find that the Ld. Advocate is correct in his assertion that the ratio laid down by the Tribunal Larger Bench in the case of Lakshmi Automatic Loom Works Ltd. Vs CCE Trichy ..... X X X X Extracts X X X X X X X X Extracts X X X X
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