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TMI ID= 265589
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2015 (10) TMI 864 - CESTAT NEW DELHI

CCE, Ludhiana Versus M/s Abhishek Industries Limited

Denial of CENVAT Credit - credit of Additional Duties of Excise (textile and textile articles) - Held that:- Initially the respondent was manufacturing cotton yarn and man-made yarn. By Notification No. 30/2004-CE, their final product became exempt, therefore, under wrong impression reverse cenvat credit on inputs or finished goods which was not required to be reversed.Therefore, they utilise cenvat credit of additional duty of excise (textile and textile articles) for reversal of cenvat credit for packing material. In fact, during that period, respondent was not required to reverse the credit, therefore, question of utilisation of additional duty of excise (textile and textile articles) does not arise - when respondent was not required to reverse the cenvat credit on packing material at the time their final product became exempt, therefore, utilized additional duty of excise (T&T) for payment of duty does not arise - Decided against Revenue.

No.- Excise Appeal No. 2093 of 2006

Order No.- Final Order No. 52134/ 2015

Dated.- July 7, 2015

Citations:

  1. COLLECTOR OF CENTRAL EXCISE, PUNE Versus DAI ICHI KARKARIA LTD. - 1999 (8) TMI 920 - SUPREME COURT OF INDIA

  2. Commissioner of Central Excise, VISAKHAPATNAM Versus M/s. VENKATA BALAJI JUTE MILLS PVT. LTD. - 2005 (6) TMI 548 - CESTAT BANGALORE

Mr. Ashok Jindal, Member (Judicial) and Mr. B. Ravichandran, Member (Technical), JJ.

For the Petitioner : Shri Ranjan Khanna, DR

For the Respondent : Shri Rahul Tangri, Advocate

ORDER

Per: Ashok Jindal:

The Revenue is in appeal against the impugned order on the ground that as per Rule 3(7)(b) of the Cenvat Credit Rules, 2004 the respondent were not entitled to utilise the cenvat credit of Additional Duties of Excise (textile and textile articles) for payment of excise duty. Therefore, the ld. Commissioner (Appeals) fell in error allowing the same to the respondent. 

2. Heard the parties and considered the submissions.

3. In this case, initially the respondent was manufacturing cotton yarn and man-made yarn. By Notification No. 30/2004-CE, their final product became exempt, therefore, under wrong impression reverse cenvat credit on inputs or finished goods which was not required to be reversed.Therefore, they utilise cenvat credit of additional duty of excise (textile and textile articles) for reversal of cenvat credit for packing material. In fact, during that period, respondent was not required to reverse the credit, therefore, question of utilisation of additional duty of excise (textile and textile articles) does not arise.Therefore, the Commissioner (Appeals) has rightly observed as under:

I observe that the issue before me is to decide as to whether credit availed and utilised during the period when final product was dutiable is to be reversed when subsequently final product is cleared at zero rate of duty and also whether such reversal on account of Basic Excise duty and Edu. Cess can be made by utilizing the credit of AED(TTA).I find that the Cenvat Credit was availed and utilised during the period when the goods were leviable to duty which were cleared subsequently at zero rate of duty by virtue of exemption Notification No.30/2004-CE dt.9.7.2004.I consider that reversal of cenvat on the inputs contained in the goods cleared at zero rate of duty is not required in view of the decision of CESTAT in final order No. 867/2005 dt.2.6.05 (2005-TIOL-962-CESTAT-Bangalore) in CCE Visakhapatnam vs. Venkata Balaji Jute Mills and the judgment of the Hon’ble Supreme Court in the case of CCE, Pune vs. Dai Ichi Karkaria Ltd. 1999 (112) ELT 353 (SC).  Moreover the issue of Cenvat reversal of Basic Excise Duty from AED (TTA) has already been decided vide O-I-A No. 603/CE/Appeal/Ldh./04 dt. 31.8.04 in the case of M/s Abhishek Industries Ltd. Terry Towel Division, Barnala.

4. We do agree with the observation of the learned Commissioner (Appeals) that when respondent was not required to reverse the cenvat credit on packing material at the time  their final product became exempt, therefore, utilized additional duty of excise (T&T) for payment of duty does not arise. 

5. In these circumstances, we do not find any infirmity in the impugned order and merit in the appeal filed by the Revenue.Therefore, we dismiss the appeal.

 
 
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