2019 (7) TMI 780 - CESTAT NEW DELHI

Short payment of Excise Duty - removal of the alleged capital goods, as waste and scrap - Rule 3(5A) of Credit Rules - restrospective application of the rule by way of issuance of notification - It is the contention of the Department that during the relevant period Rule 3(5A) of Credit Rules has been amended by issue of Notification 03/2013-CE NT dated 1/03/2013, which was further amended by Notification dated 27/09/2013 which restored the previous position as prevalent under Rule of 1994, and erstwhile Credit Rules - HELD THAT:- The perusal of the history Rule 3(5A) indicates that barring the period 17/03/2012 to 26/09/2013, the provision existed for reversal of credit on the transaction value. As the amendment was made to mitigate the hardships caused to the trade, this is a beneficial piece of legislation and thus required to given the retrospective effect.

Further, the issue involved interpretation of provisions of Rule 3(5A), and therefore, the Ministry has to clarify the issue subsequently by issuance of amended notification - there were a widespread confusions in the trade regarding modality to be adopted for the reversal of the credit. Even if it is assumed that the appellant has removed capital goods, although the same is being contested.

There has been evidence of series of communication regarding on the issue of reversal of Cenvat Credit between, the department and the appellant as it is evident from the various communications exchanged between them which is manifested from the letters dated 23.09.2013, 22.01.2014, 12.02.2014, 19.05.2014, 09.12.2014, 29.12.2014, 06.02.2015, 09.04.2015, 11.05.2015. 09.10.2015 and 20.11.2015 - the extended period of limitation for raising the demand is not available with the department.

The impugned order is not sustainable both on merits and limitation - appeal allowed - decided in favor of appellant.