2019 (7) TMI 782

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..... input services - This view was fortified by the provisions of Rule 6(4) of CCR, which provides that an assessee is entitled to take cenvat credit on capital goods even during the period, they were availing SSI exemption. However, under Clause (IV) in para 2 of the SSI exemption notification, the utilisation of such cenvat credit taken on capital goods during the period of enjoying the SSI exemption is suspended. The CENVAT credit of capital goods does not lapse and was rightly availed by the appellants and subsequently, utilised when they stopped availing the SSI exemption. Appeal allowed - decided in favor of appellant.
Mr. Anil Choudhary, Member (Judicial) Ms. Rinki Arora, Advocate for the appellant. Shri P.R. Gupta, Authorised Repr .....

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..... venue that the cenvat credit on capital goods has been lapsed under the provisions of Section 11(2) of the Cenvat Credit Rules when the availed SSI exemption. Accordingly, the appellant was not entitled to carry forward and utilise such cenvat credit after they started paying duty again from March/April, 2007. 2. Heard the parties. 3. The relevant provisions for the sake of reference are produced hereinbelow: Para 2 of Notification No.8/2003 "(iv) the manufacturer also does not utilise the credit of duty on capital goods under rule 3 or rule 11 of the said rules, paid on capital goods, for payment of duty, if any, on the aforesaid clearances, the aggregate value of first clearances of which does not exceed rupees one hundred lakhs, as c .....

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..... Rule 3 or rule 11 of the CENVAT Credit Rules, 2002 (hereinafter referred to as the said rules), paid on inputs ...............of first clearance of which, as calculated, in the manner, specified in the said Table does not exceed rupees one hundred lakhs;". 5. Thus, on a cogent or harmonious reading of the aforementioned provisions, it is evident that what lapses on the date the asssessee avails SSI exemption, is only cenvat credit related to input or input services. This view was fortified by the provisions of Rule 6(4) of CCR, which provides that an assessee is entitled to take cenvat credit on capital goods even during the period, they were availing SSI exemption. However, under Clause (IV) in para 2 of the SSI exemption notification, t .....

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