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2018 (11) TMI 1443 - CESTAT KOLKATAIrregular availment of CENVAT Credit - input materials were removed as such by the appellant under the cover of invoices, on payment of an amount equal to the credit taken in terms of Rule 3 (5) of the Cenvat Credit Rules, 2004 - It is the case of the Revenue that since the assessee did not use the inputs in or in relation to the manufacture of finished goods and accordingly, the services used in procuring the inputs would not qualify for availing cenvat credit. Held that:- The issue is no more res-integra in view of the various decisions of the Hon’ble High Courts and the Tribunal. This Bench of the Tribunal in the case of Seven Star Steels Ltd. Vs. Commr. Of Central Excise, Customs & S. Tax, BBSR II [2013 (5) TMI 119 - CESTAT KOLKATA] by relying upon the decision of the Tribunal in the case of Chitrakoot Steel & Power Pvt. Ltd. Vs. Commissioner [2007 (11) TMI 135 - CESTAT, CHENNAI] had allowed the appeal filed by the assessee. CBEC vide Instruction F.No.96/85/2015/CX.I dated 07.12.2015 has observed, on the reversal of cenvat credit in respect of services paid on the input services that Rule 3(5) of the CENVAT Credit Rules, 2004 does not provide for reversal in respect of input services for a reason. Input services are consumed once the inputs and capital goods are received in the factory. Thus on receipt of inputs and capital goods, the associated input services have to be considered as consumed within the factory and become a cost to the business. Demand for reversal o the input services credit, when such input services cannot be reused, unlike inputs and capital goods which are available for reuse would not be fair to the trade. Appeal allowed - decided in favor of appellant.
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