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2018 (5) TMI 778 - AT - Central ExciseCENVAT credit - common input service credit was used for dutiable goods as well as the exempted service of trading - appellant did not file declaration under Rule 6(3A) - Rule 6(3)(i) of CCR - Held that: - It is seen that Rule 6(3)(i) has been amended w.e.f. 01.06.2015 providing for reversal of 7% of the value of exempted service. The period involved in the present case is from July, 2011 to March, 2016. The requirement of reversal of an amount under Rule 6(3)(i) including the value of exempted service i.e. trading will arise only after the date of such amendment. For the period prior to 01.04.2015, there is no requirement of reversal of credit @ 7% of exempted service. This position has been clarified by the CBEC vide their Circular dated 07.12.2015. For the period prior to 01.04.2015 there is no requirement under Rule 6(3)(i) for any reversal of credit of input services availed for clearance of input as such - It has been submitted that on the value of inputs cleared as such, the reversal on the value of goods as required under 3(5) has already been made. This aspect needs to be verified inasmuch as no details have been given on such reversed. In respect of reversal of credit of input services, for the period subsequent to 01.04.2015, it is the submission of the appellant that proportionate credit reversal for input services has already been made even though the requirement of exercising an option as required under Rule 6(3A) has not been done by the appellant. The failure to exercise option is only a procedural requirement and may be overlooked since proportionate reversal of input services has already been made - demand set aside. Reversal of CENVAT credit - clearance of waste and scrap in the form of floor sweeping as well as discarded packing material - invocation of Rule 6(3) of CCR - Held that: - the scrap of packing material cannot be said to have arisen during the course of manufacture of final products. Consequently, the mischief of Rule 6(3) will not be attracted - demand set aside. Appeal allowed in part - part matter on remand.
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