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2023 (8) TMI 177 - AT - Central ExciseReversal of Cenvat credit lying unutilized in respect of ADE(T&TA) in terms of transitional provision of Rule 11(3)(ii) of the Cenvat Credit Rules, 2004 - HELD THAT:- The said Rule 11(3) has come into effect only with effect from 01.03.2007 therefore any credit availed prior to that and carried forward the same cannot be recovered by invoking Rule 11(3) as the said Rule does not have retrospective effect. It shall be applicable only in a case when any exemption notification is availed on or after 01.03.2007 when the Rule 11(3) came into effect - In the present case, the appellant’s final product was exempted as well as credit of ADE(T&TA) was lying during the period much before the insertion of Rule 11(3) in Cenvat Credit Rules. Therefore the said Rule cannot be applied and consequently ADE(T&TA) cannot be demanded. The very same issue has been considered by this Tribunal in the case of IBM India Private Limited [2019 (11) TMI 299 - CESTAT CHENNAI], wherein the Tribunal has held that after the introduction of Rule 11(3) by Notification No. 10/2007 dt. 01.03.2007 the Tax Research Unit of CBEC has issued Circular No. 334/1/2007-TRU dt. 28.02.2007 clarifying that it will come into effect immediately. The letter does not suggest that Rule 11(3) was supposed to have retrospective effect. Therefore, we find that it has never been the intention to give retrospective application to Rule 11(3). The issue in hand has been addressed by the Tribunal in the above decision whereby it was held that Rule 11(3) of Cenvat Credit Rules, 2004 though provides for reversal of unutilized Cenvat credit but the same cannot be applied retrospectively in the absence of specific provision under the statute. The appellant is neither liable to reverse the accumulated Cenvat credit of ADE (T&TA) nor the demand of the same is sustainable - Appeal allowed.
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