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2021 (7) TMI 1347 - AT - Central ExciseCENVAT Credit - dutiable as well as exempt goods - non-maintenance of separate records - whether the demand raised in the impugned order by invoking Rule 6(3)(b) of the Credit is legally sustainable whereby the amount of 10% of the value of exempted goods has been considered as ineligible credit - Time Limitation - Penalty - HELD THAT:- The issue is decided in the case of DR. WRITER’S FOOD PRODUCTS PVT. LTD. VERSUS COMMR. OF C. EX., PUNE-II [2009 (3) TMI 846 - CESTAT, MUMBAI] where it was held that The appellants, in the case before us, have not only reversed the credit of Rs. 70,21,383/- but also paid the interest of Rs. 4,71,189/-. We feel that by doing so, the appellants, have undone the act of taking/utilizing the credit, it amounts to not taking the credit and, therefore, they are not required to pay an amount equal to 10%. Since the legal position stands settled in favour of the assessee, there are no reason to take a contrary view. In the facts of the present case, since it is found that the credit amount attributable to clearance of exempted goods stands already reversed which fact is on record, there is no justification to saddle the assessee with disproportionate demand by mechanically applying the formula of 10% of the value of exempted goods, moresoever when credit has not been availed of such huge amount. Appeal allowed - decided in favor of appellant.
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