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2016 (6) TMI 469 - AT - Central ExciseRequirement of reversal of Cenvat credit - finished goods which have been written-off - Rule 3(5B) of the Cenvat Credit Rules, 2004 – Held that:- there is no provision for reversal of cenvat credit on inputs/ components which have been used in the manufacture of final product. In fact, as per Section'3 of the Central Excise Act, 1944, the goods manufactured by an assessee are to be cleared on payment of duty, therefore, reversal of cenvat credit on finished goods does not arise; at the most, duty can be demanded. Requirement of reversal of Cenvat credit - traded goods - no credit has been taken – Held that:- as no cenvat credit has been taken by the appellant on traded goods, reversal of cenvat credit on those goods does not arise. Requirement of reversal of Cenvat credit - inputs/ components - provision has been made in the balance sheet but not actually written-off – Held that:- appellant has made a provision for written-off but inputs and components were not actually not written off by the appellant. Further, the appellant has used these inputs and components later on, in the manufacture of final goods, in that circumstances, as per provision of Rule 3 (5B) appellant is entitled to take cenvat credit on these inputs and components. Therefore, appellant is not required to reverse cenvat credit on inputs/ components for which they have made provision in the balance sheet. Invokation of extended period of limitation – Issuance of subsequent SCN – Held that:- it is found that periodical show cause notices had been issued to the appellant as the first show cause notice for the period 2005-08 to 2008-09 was issued on 05.04.2010, therefore, both the show cause notices issued in question to the appellant by invoking extended period are barred of limitation. Therefore, the show cause notices are not sustainable in the eyes of law. Accordingly, the impugned proceedings are set aside as time barred. Applicability of Rule 14 of Cenvat Credit Rules, 2004 – Held that:- it is found that the appellant had taken cenvat credit correctly on inputs/ components at the time of procurement thereof and there is no allegation in the show cause notice that appellant has wrongly taken cenvat credit. Therefore, the provision of Rule 14 of Cenvat Credit Rules, 2004 are not applicable to the facts of the case. – Decided in favour of appellant with consequential relief
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