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2017 (1) TMI 650 - AT - Central ExciseCENVAT credit - Payment of duty on non-excisable goods - demand of differential amount between CENVAT credit taken on MS wire and the 8% paid by them on MS wire made out of duty-paid MS wire. - the contention of assessee that MS wires are not non-excisable goods that with acceptance of duty of 8% there is no scope for denial of credit, that bulk of their production is manufactured out of wire rods and that denial of CENVAT credit is contrary to the said Rules, is justified? - Held that: - The scheme of CENVAT credit is erected on the foundation that there is a last person in the chain of trade and commerce who is required to be saddled with the burden of duty without being able to claim any set-off. Such person is the ultimate consumer of the product. The privilege that accompanies payment of specified tax or duty on exempted goods or services under CENVAT Credit Rules, 2004 is intended to ensure that convenience is afforded to manufacturers or service providers who may, owing to some exemption that they may not be interested in claiming, be, yet, compelled to implement administrative measures of separate accounts that are be too cumbersome. On non-excisable goods, the purchaser is not denied the option of paying duty. Consequently, appellant has rightly been denied the facility of payment of the deemed tax/duty to avail CENVAT credit. Extended period of limitation - Held that: - The communication from appellant to the Range on 22nd September 2000 and the direction of the Range to appellant in letter dated 14th December 2001 is claimed as support for this contention made on behalf of appellant. Neither the original authority nor the first appellate authority have considered this aspect and have not rendered a finding on the allegation of deliberate suppression of facts with intent to evade duty even though the claim of limitation was raised in response to the notice - recovery is hit by limitation in section 11A of Central Excise Act, 1944. Appeal allowed on the ground of period of limitation - decided in favor of appellant.
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