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TMI Blog2022 (11) TMI 1145X X X X Extracts X X X X X X X X Extracts X X X X ..... be determined with reference to the dutiability of the final produce on the date of receipt of capital goods irrespective of whether the exempted goods have been manufactured or not? 2. Whether the Hon'ble Tribunal has erred in ignoring the plea raised by the Department in their Grounds of Appeal as to whether the adjudicating authority is right in holding that the services provided by the respondent falls under the category of "Business Support Service" ignoring the fact that the pre-dominant character of the services provided by the respondent is covered by "Renting of immovable Property" service; that easing/renting of factories is specially covered under the category of renting of immovable property; that consideration for the Wet Lease Agreement being received by the respondent is clearly divisible between Fixed Wet lease Charges in respect of lease of fixed assets and Variable Wet Lease Charges towards operating and maintenance of factory and as such part of the lease pertaining to the leasing of manufacturing facility falls under the category of "Renting of Immovable Property" service?" 3. Learned counsel for the appellant/revenue has submitted that the respondent/assesse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t will not be available to the manufacturer. Subsequently, the exempted product becomes dutiable on account of withdrawal of exemption or the manufacturer puts the capital goods to other use would not revive the question of Modvat credit which stands determined at the time the capital goods was received. The decision of the single Bench of the Tribunal in Kailash Auto Builders case is not applicable to the facts of the present matter as the Appellants therein "have made their intention clear that they would be using the said capital goods in the manufacture of excisable final products once the factory starts working to its full capacity." Further, the facts are also different in the case of Bhaskar Industries Ltd. inasmuch as in the said matter the Respondents "had a project to set up a composite mill for spinning, weaving and processing" meaning thereby for manufacture of excisable goods which are chargeable to duty. We observe that the Respondents therein "kept the option of availing the Modvat credit on capital goods in abeyance for about a year, till implementation of the third phase, namely, the fabric processing. The assessee submitted the required declaration under Rule 57T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xable output services and was justified in availing and utilizing the "CENVAT Credit". The respondent/assessee had been regularly filing the prescribed returns and had not suppressed any material from the Department. 7. In support of his arguments, learned counsel for the respondent/assessee has placed reliance on the decision of the Hon'ble High Court of Punjab & Haryana in Commissioner of Central Excise, Chandigarh versus S.T. Cottex Exports Pvt. Ltd., dated 05.01.2011, reported in 2012(26) S.T.R.65 (P&H), wherein, it was held as under:- "4. Learned counsel for the appellant submits that even though Notification dated 9-7- 2004 was in force, the same provided for optional duty and the assessee never invoked the said notification. In such a situation, the view of the Tribunal is against the view taken by it in CCE, Indore v. Surya Roshni Ltd.-2003 (155) E.L.T.481 (T) which was upheld by the Supreme Court [(2003 (158) E.L.T.A273 (S.C.)]. As per the said judgment, on capital goods which are exclusively used in manufacture of exempted goods, credit was not available. Subsequent withdrawal of exemption could not validate the credit wrongly taken. 5. We are unable to accept the su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not in dispute. Admittedly, the respondent/assessee had initially filed a declaration on 04.08.2006 to avail benefit of Notification No.49-50/2003-CE, dated 10.06.2003, area based exemption for manufacture of goods. However, the respondent/ assessee then filed another declaration on 29.06.2007 to the effect that it had let out the premises on lease to Hindustan Liver Limited for manufacture of intended goods. A "Wet Lease Agreement" was executed between the parties on 22.05.2007. The scope of "Wet Lease" as per the agreement, reads as under:- "Wet Lease means leasing by the Lessor to the Lessee the Manufacturing Undertaking, which shall comprise of land, buildings and structures, plant and machinery, utilities and ancillary facilities, both movable and immovable ("Assets") therein together with all the workers and employees hire/employed by the Lessor for running, operating and maintaining the Manufacturing Undertaking as is more particularly detailed in Schedule 2. Hereto, so as to enable HLL to manufacture the Products on its own account, using its own raw materials, Processing Chemicals and packaging materials at the Manufacturing Undertaking. Further HLL will provide the fuel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tation on 13.07.2010. Learned counsel for the appellant/revenue has failed to point out any provision which required the respondent to intimate to the Department that he had availed the "CENVAT Credit" on the capital goods inputs or the input services, on which, it intended to take credit. It is not a case where the respondent had not maintained the records correctly or had filed incorrect returns. Respondent/assessee was required to disclose only those facts to the appellant/revenue as required under law. Hence, the Adjudicating Authority rightly came to the conclusion that the Show Cause Notice dated 13.07.2010 was barred by limitation. 15. So far as the Show Cause Notice dated 18.10.2010 is concerned, the same was held to be within the period of limitation and it was observed by the Adjudicating Authority that the credit of Rs.12,56,125/- had been wrongly taken. So far as this finding of the Adjudicating Authority is concerned, the same was not contested by the respondent/assessee in appeal as it had already deposited the said amount, but had only sought waiver of penalty imposed against it by the Adjudicating Authority. 16. Admittedly, in the present case, the respondent/ ass ..... X X X X Extracts X X X X X X X X Extracts X X X X
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