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2018 (9) TMI 981 - AT - Central ExciseCENVAT Credit - inputs removed as such - whether such removal amounts to trading activity or not? - reversal of proportionate credit - Rule 6(3A) of CENVAT Credit Rules, 2004 - Held that:- The department does not have a case that these spares and consumables are not integrally connected to the machines. They have also not denied that these are inputs for the appellants and also that the credit availed on such spares and consumables are not eligible. It is to be specifically stated that there is no allegation show cause notice that such goods are not inputs to the appellant. Thus when inputs are removed as such Rule 3(5) would come into application. There is clear distinction from Rule 3(5) from trading activity for the reason that the credit is not eligible on traded goods whereas credit under Rule is eligible on inputs used for the clearance of final products. Credit remains allowed - appeal allowed - decided in favor of appellant.
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