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TMI Blog2019 (1) TMI 314X X X X Extracts X X X X X X X X Extracts X X X X ..... tained in Cenvat Credit Rules 2002 and Cenvat Credit Rules 2004 for the period April 2004 to 31st March, 2008 vide their letter dated 2nd November, 2011. Demand in respect of financial year 2008.09 for an amount of ₹ 8,85,719/- - Held that:- It is observed that the same is based on 10% of sale-price of exempted goods and that the Department has not computed the quantum of credit actually attributable to the exempted goods, as is otherwise been clarified in the CA certificated and also is apparent from the verification report. Thus, the demand for this period is also held to not to be sustainable. Violation of rule 6 of Cenvat Credit Rules, 2004 - interpretation of statute - Held that:- The appellant is entitled to exercise the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gainst the order No.31-17-18 dated 24.01.2018. The factual matrix for the purpose is that the appellant is engaged in manufacture of dutiable as well as exempted goods. During the course of its audit in the year 2006, the Department observed that the appellant was not maintaining separate records for input used in exempted and dutiable goods. However, was availing cenvat credit on the inputs used in both dutiable as well as exempted goods. Resultantly, a show cause notice dated 06.05.2009 was issued proposing the recovery of an amount of ₹ 1,78,70,719/- equal to 10% from 10.09.2004 (8% upto 09.09.2004) of the total price. The interest at the appropriate rate and the proportionate penalty was also proposed. The said show cause notice w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rice of exempted goods under Rule 6 of the credit Rules. The tax payer only needs to reverse the credit on inputs attributable to exempted goods. Ld. Counsel has relied upon the following case laws:- 1. Welspun Corporation Limited vs. CCE reported in 2018 (12) TMI 165-(CESTAT-Ahmadabad). 2. Punjab National Bank v. CCE reported in 2018 (7) TMI 1131-CESTAT-Delhi. 3. Department on the other hand has justified the order submitting that the verification report as well as the CA Certificate has duly been considered and accordingly an amount of ₹ 28,58,763/- alongwith the interest at the rate of 24% and that the amount of ₹ 10,18,279/- has rightly been ordered to be appropriated for the period 01.04.2004 to 03.03.2008. S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 28,23,393 5. The adjudicating authority below has observed that these are the findings due to the fact that in place of Annexure B2, Annexure B5 is attached and that Annexure C3 is not available with the certificate. But the perusal of record shows that this is apparently a wrong finding. All the Annexures as mentioned to have been attached with the certificate are on record. Perusal thereof reveal the following details:- Financial Year Demand in SCN (in Rs.) Demand in OIO Credit not availed Credit reversed with interest Inputs (in Rs.) Input Services (in Rs.) I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... able, it is clear that the cenvat credit for an amount much more than what has been confirmed by the original adjudicating authority has already been reversed. Hon ble Apex Court in the case of Chandrapur Magnet Wires Pvt. Ltd. vs. CCE, Nagpur reported in 1996 (81) ELT 3 (S.C.) has held that once cenvat credit is reversed, it is to be considered ab initio not availed, the appellant herein in compliance of Rule 6 (a) as had also intimated about exercising the option of availing the amended provisions contained in Cenvat Credit Rules 2002 and Cenvat Credit Rules 2004 for the period April 2004 to 31st March, 2008 vide their letter dated 2nd November, 2011. The same has nowhere been denied by the Department. Hence, the demand confirmed for th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appellant to avail a particular option. We draw our support from the case CCE vs Max New York Life Insurance 2017 (5) TMI 1994 (Tri. New Delhi). In another case decided by the Tribunal Mumbai, i.e. Mercedes Benz vs CCE Pune 2015 (40) STR 381 where it was held that there is no provision that if the assessee fails to opt any of the option at a particular time, then option of payment of 5% will automatically be applied. Where the assessee has categorically by way of intimation opted for option provided under 6(3)(ii), CCR then the Revenue cannot insist the assessee to opt for Rule 6(3)(i). 9. Keeping in view the entire above discussion we are of the opinion that the Adjudicating Authority has failed to interpret Rule 6(3) CCR properly ..... X X X X Extracts X X X X X X X X Extracts X X X X
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