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TMI Blog2024 (8) TMI 11X X X X Extracts X X X X X X X X Extracts X X X X ..... MI 51 - CESTAT, MUMBAI] ? HELD THAT:- The appellant has paid duty on the depreciated value of the capital goods. Thus, the duty has been discharged on depreciated value, therefore, the reversal of credit will be confined to the extent of use of capital goods i.e. value of the capital goods will be depreciated based on its use over the period of use. Keeping in view the above ruling of the High Court, as the removal cannot be treated as removed as such , therefore, the duty has to be discharged on the depreciated value. Accordingly, the view taken by the Customs, Excise Service Tax Appellate Tribunal in its order dated 07.07.2011 would go contrary to the law as held in COMMISSIONER CENTRAL EXCISE COMMISSIONERATE VERSUS M/S RAGHAV ALLOYS LTD. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of time, in-serviceable and fit to be scrapped. The object of Cenvat Credit capital goods is to avoid the cascading effect of duty. If even after use for on a couple of years, the Cenvat Credit is required to be reversed then it would certainly defeat the object of the scheme. To avoid misuse of the scheme in the Rules, it has been provided that if the machines are cleared as such the Assessee shall be liable to pay duty equal to amount of Cenvat Credit availed. The machines which are cleared after utilization cannot be treated as machines cleared as such. With effect from 13-11-2007, a proviso has been added to Rule 3(5) of the Cenvat Credit Rules providing that if the capital goods on which Cenvat credit has been taken are removed after ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y were removed by invoices to its sister unit during the same period, claiming depreciation as per the rates fixed by the Central Board of Excise and Customs vide its circular dated 26.05.1993 and 01.07.2002. The appellant, therefore, has paid duty on the depreciated value of the capital goods. Thus, we find that duty has been discharged on depreciated value, therefore, the reversal of credit will be confined to the extent of use of capital goods i.e. value of the capital goods will be depreciated based on its use over the period of use. Keeping in view the above ruling of the High Court, as the removal cannot be treated as removed as such , therefore, the duty has to be discharged on the depreciated value. Accordingly, the view taken by th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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