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TMI Blog2023 (1) TMI 1046X X X X Extracts X X X X X X X X Extracts X X X X ..... credit attributed to the exempted goods, no demand of 10% of the value of goods can be raised by the department. Reversal of proportionate credit is one of the option provided under Rule 6(3). Therefore, it is upto the assessee which option needs to be availed. The department cannot arbitrarily choose any particular option and impose on the assessee. In the present case as per the submission of the appellant, the entire credit of Rs. 22,18,585/- has been reversed on all the common input service used in or in relation to manufacture of dutiable and exempted goods. The adjudicating authority straight away demanded 10% of the value of exempted goods. Therefore, he neither examined the reversal of cenvat credit made by the appellant nor eve ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hey are clearing the goods, namely, Vaxem HIB at nil rate of duty. The appellant started availing cenvat credit on various input services from March 2005. The case of the department is that since the appellant are availing the cenvat credit in respect of common input services, they are liable to pay 10% of the value of exempted goods or goods attracted nil rate of duty in terms of Rule 6(3) of the Cenvat Credit Rules 2004. 2. Shri Jigar Shah, learned Counsel appearing on behalf of the appellant submits that the appellant have reversed the entire credit of common input services used in the manufacture of dutiable as well as exempted goods, therefore, the demand of 10% of the value of the exempted goods in terms of Rule 6(3) will not susta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Beri Mercurio 2018 (11) TMI 737 Johnson Johnson Ltd. 2003 (156) ELT 134 affirmed by Hon ble Supreme Court 2005 (188) ELT 467 2.2 Shri Jigar Shah also submits that the appellant as per the provision is required to reverse the proportionate credit attributed to the exempted goods. As against the proportionate credit the appellant have reversed much more amount i.e. entire credit on the common input service amounting to Rs. 22,18,585/-. It is his submission that the amount over and above the proportionate credit may be adjusted against the liability of interest, if any arise. 3. Shri V.G. Iyengar, learned (Superintendent) Authorized Representative appearing on behalf of the Revenue reiterates the findings of the impugned order. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ined the reversal of cenvat credit made by the appellant nor even calculated the proportionate credit. The submission of the appellant also needs to be reconsidered whether the excess amount can be adjusted against the interest. 5. We are of the view that on the above observation, the matter needs to be reconsidered. As regard, the personal penalty, firstly the appellant company has reversed the credit accordingly, the demand is not prima facie sustainable. Consequently, since the issue relates to the interpretation of Rule 6 of Cenvat Credit Rules, 2004, malafide intention of the present employee with the appellant cannot be attributed. Therefore, considering the facts of the present case, we are of the considered view the personal pena ..... X X X X Extracts X X X X X X X X Extracts X X X X
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