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2019 (11) TMI 292 - AT - Central ExciseCENVAT Credit - use of capital goods exclusively in the manufacture of exempted goods - concessional exemption N/N. 29/2004-CE dated 09/07/2004 - contention of the department is that since at the time of receipt of capital goods, the appellant was manufacturing exclusively exempted goods with the help of the said warping machine, they are barred from availing the Cenvat Credit on such capital goods - Rule 6 (4) of the Cenvat Credit Rules, 2004 - HELD THAT:- Rule 6(4) was amended by N/N. 13/2016- CE (N.T.) dated 01/03/2016 but the amendment is by way of substitution of Rule 6 (4). As per the above substituted Rule, it is clear that the bar on availing the credit in respect of capital goods used in manufacture of exempted goods shall apply only if the capital goods are used for two years from the date of installation/commencement of production - As per the facts of the present case, though the appellant received and installed the capital good in their running unit in November, 2014 but before completion of two years, in August, 2016 the capital good was used for manufacture of goods which were cleared on payment of duty, availing the exemption N/N. 29/2004-CE. Therefore, the capital goods was not used continuously for two years for manufacture of exclusively exempted goods. Since the amendment is by way of substitution, it will be applicable from the retrospective effect. Cenvat Credit on the capital goods is admissible - Appeal allowed - decided in favor of appellant.
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