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2012 (12) TMI 227 - CESTAT NEW DELHIDisallowance of Cenvat credit - Recovery of Cenvat credit with Interest and Penalty - inputs/capital goods and services utilised by the appellant in the research and development centre had no direct or indirect nexus with the manufacture of final product(Department) - appellant seeking waiver of condition of duty demand, interest and penalty - held that:- Appellant who is manufacturer of motor vehicles is required to submit prototype of the vehicle for test by agency specified under the rules before starting actual production of motor vehicle for sale. Therefore, any charge incurred in research and development unit would fall within the definition of Input service, capital goods or input service for the purpose of availing cenvat credit - impugned order is not sustainable as nexus with manufacture is established and thus this is a fit case for grant of waiver of duty demand, interest and penalty pending appeal - after waiving the conditions ofi pre-deposit, impugned order is set aside and remand the matter back to the Commissioner concerned for de novo adjudication in the light of the Motor Vehicles Rules, 1989 after giving opportunity of being heard to the party as the above plea has been raised for the first time before the Tribunal in the interest of justice - Appeal is decided accordingly.
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