2008 (8) TMI 334

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..... learned JCDR, for the Revenue. 3. The appellant is a 100% EOU under the EHTP scheme. They also have a DTA unit in the same premises. Certain machinery namely capital goods were imported for the use of the DTA Unit on payment of duty. The Cenvat credit was taken on those goods. Later with the permission of the concerned authorities, the capital goods were removed to their EHTP premise under the CT-3 procedure by availing the benefit of Notification 22/2003, dated 31-3-2003. Even though the appellants were permitted to remove the goods under CT-3 certificate issued by the department, the departmental authorities compelled the appellant to pay Central Excise duty on the capital goods, because they had initially availed Cenvat credit. Under pr .....

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..... se of Madura Coats (P) Ltd. v. CCE, Tirunelveli - 2005 (190) E.L.T. 450 (Tri.-Bang.) has held that when the used Cenvated capital goods are removed, there is no provision to demand duty on them. Further, the learned Chartered Accountant relied on the following case laws: (a) Gharda Chemicals Ltd. v. CCE, Pune-II - 2006 (196) E.L.T. 325 (Tri.-Mumbai) (b) Lakshmi Synthetic Machinery Minfrs Ltd. v. CCE, Coimbatore - 2005 (184) E.L.T. 109 (Tri.-Chennai) (c) Manaksia Ltd. v. CCE, Kolkata-IV - 2007 (216) E.L.T. 231 (Tri.-Kolkata) (d) Albright Morarji & Pandit Ltd. v. Union of India and Others -1987 (30) E.L.T. 898 (Bom.) (e) Krishna Industrial Corporation Ltd. v. CCE, Guntur - 2005 (186) E.L.T. 318 (Tri.-Bang.) 4. The learned JCDR reiterate .....

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..... have been eligible to take a credit in respect of capital goods. However, the cited Notification No. 22/03-C.E. subsequently allows a 100% EOU to procure capital goods without payment of duty against CT-3 Certificate. Since a reading of both the sub-rules together makes it clear that what is sought to be reversed is in the nature of duty and the same duty is exempted under the Notification for specific cases, such as supply to 100% EOU., a liberal approach to interpreting the legal provision is required, so that such removal from capital goods to eligible 100% EOU need not be subjected to payment of duty in view of specific exemption available. 6. Even if the capital goods have been removed as such, according to the Tribunal Notification N .....

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