TMI Blog2019 (4) TMI 27X X X X Extracts X X X X X X X X Extracts X X X X ..... the Income Tax Act, 1961. Thus, availing credit on capital goods when depreciation was also claimed is against the provisions of law. The Department had sought the assessee to reverse the Credit. The assessee though availed Credit on capital goods, had not utilized it. For this reason, the assessee contended that the availment of Credit was only a book entry and therefore, the demand of interest cannot sustain. The Hon’ble High Court in the case of Commissioner of C.Ex., Madurai Vs. M/s. Strategic Engineering (P) Ltd. [2014 (11) TMI 89 - MADRAS HIGH COURT] had held that the demand of interest or penalty cannot sustain when the credit wrongly taken has been reversed - In the case before us, the appellant has not reversed the wrongly ava ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ,48,42,336/- taken on such capital goods for the period from 2006-07 to 2010-11 under Rule 14 of the CENVAT Credit Rules (CCR), 2004 read with Section 73(1) of the Finance Act, 1994, along with demand of interest under Section 75 ibid and imposition of penalty under various provisions of law. In adjudication, vide the impugned Order dated 25.02.2013, the Commissioner confirmed the demand of ₹ 1,48,42,336/- as proposed in the Notice. The adjudicating authority also held that the amount of Credit so wrongly taken by the assessee during each of the financial years from 2006-07 to 2010-11, shall be treated as recovered from them on the first day of the financial year immediately following the financial year in which the capital goods had ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... annot be alleged on them. (iii) On the demand of interest, Ld. Advocate draws our attention to the judgement of the Hon ble High Court of Madras in the case of C.C., C.Ex. S.T., Coimbatore Vs. M/s. Sri Kumaran Alloys (P) Ltd. 2019 (365) E.L.T. 305 (Mad.) to underline his contention that there cannot be any interest liability cast on the assessee. (iv) The appellant had entered the credit details in their account and it could have been verified by the Department. The Show Cause Notice has also relied upon the ST-3 half yearly returns for the period from October 2006 to March 2011 to invoke the larger period. It is submitted that this exercise could have been done by the officials of the Department within the normal period. Ther ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... premises of the provider of output service at any point of time in a given financial year shall be taken only for an amount not exceeding fifty per cent of the duty paid on such Capital Goods in the same financial year. 7.2 We are not able to find any confusion in the provisions mandated in the said Rules. This being so, the assessee were patently in the wrong when they have availed 100% of the Credit in the first financial year instead of availing Credit of 50% only. 8. We also note that it is not just a case of wrong availment in one year. Such wrong availment in excess of 50% of capital goods has been done by the assessee not just for the period from 2006-07, but also for the subsequent years up to 2010-11. In the circumstances, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... effect of the decision in Bombay Dyeing Manufacturing Co. Ltd. (supra), we have to point out that on facts, we are not inclined to interfere with the order passed by the Tribunal for more than one reason. Firstly, the Revenue did not dispute the fact that the assessee is an S.S.I. and has not availed the Cenvat credit and the credit remains as an entry in the books. Therefore, on facts, it will be a very hard case for the Court to reverse the decision of the Tribunal, especially when the Revenue does not dispute the factual position. Nevertheless, we are called upon to decide the substantial questions of law, which have been raised for consideration. We are inclined to do so. However, we are of the considered view that the second substant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... missioner of C.Ex., Madurai Vs. M/s. Strategic Engineering (P) Ltd. 2014 (310) E.L.T. 509 (Mad.) had held that the demand of interest or penalty cannot sustain when the credit wrongly taken has been reversed. In the case before us, the appellant has not reversed the wrongly availed Credit. Actually, there would be no meaning in recovering the wrongly availed 50% Credit as the appellant would be eligible for this Credit in the next financial year. It may be correct that they have not utilized the Credit for payment of duty/tax. In the case of M/s. Strategic Engineering (P) Ltd. (supra) and M/s. Chandrapur Magnet Wires (P) Ltd. Vs. Collector of Central Excise, Nagpur 1996 (81) E.L.T. 3 (S.C.), the Credit when availed and reversed (b ..... X X X X Extracts X X X X X X X X Extracts X X X X
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