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2016 (11) TMI 991 - AT - Central ExciseDemand - CENVAT credit of NCCD paid on Partially Oriented Polyester Yarn (POY) consumed captively for manufacture of DTY - benefit of N/N. 46/2000-CE dated 17/05/2003 - Rule 14 of the Cenvat Credit Rules read with Section 11A of the CEA, 1944 - Held that: - reliance placed on the decision of the case of COMMISSIONER OF CENTRAL EXCISE, MUMBAI Versus INDORAMA SYNTHETICS (I) LTD [2014 (10) TMI 675 - CESTAT MUMBAI] where similar issue was decided and it was held that once the exemption is availed, the question of taking any credit once again on the POY captively consumed and utilizing the same elsewhere would not arise. Though there is no one to one co-relation required between the input and output, explanation to sub-rule (7) makes it abundantly clear that if there is a conflict between the provisions of this rule and provisions of notification, the provisions of notification shall prevail - Simultaneous availment of duty exemption and benefit of cenvat credit militates against the very object of NCCD levy and would lead to huge leakages in revenue. Therefore, the impugned order is not sustainable in law. Accordingly we set aside the same and hold that the appellant is liable to reverse the credit taken along with interest thereon as correctly held in the adjudicating authority's order. However, since the issue relates to interpretation of law, imposition of penalty is not warranted. Appeal allowed - decided in favor of Revenue.
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