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2023 (4) TMI 1129 - CESTAT AHMEDABADReversal of CENVAT Credit on damaged Capital Goods - damaged goods are usable or not - Department is of the opinion that the machines so damaged on which insurance claim has been received by the appellant is to be treated as cleared after being put to use and the appellant is required to reverse the cenvat credit in terms of sub rule 5 (A) of Rule 3 of Cenvat Credit Rules, 2004 - HELD THAT:- The fact of the case is not under dispute that the machine was used for almost 4 years thereafter it got damaged, the appellant also filed the insurance claim and after survey when the surveyor was satisfied the machines are not usable, the insurance company sanctioned the insurance claim. It is also fact in record that the appellant have cleared such damaged capital goods as waste and scrap. Whether the capital goods on which the CENVAT credit was availed has been cleared as usable capital goods or waste and scrap? - HELD THAT:- As much as the appellant have cleared the capital goods as waste and scrap coupled with the fact of insurance claim it is absolutely beyond doubt that the capital goods became waste and scrap as the same is not usable for the intended purposes. In such case clearance of capital goods clearly falls under Rule 3 (5A)(b) therefore, the appellant have rightly paid the amount equal to the duty leviable on transaction value of the capital goods. Appeal allowed.
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