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2020 (1) TMI 674 - AT - Central ExciseWhether the Cenvat Credit of duty paid by a 100% EOU, which according to the department is customs duty, is admissible to the receiver? - HELD THAT:- A plain reading of N/N. 23/2003-CE dated 31/03/2003 reveals that when 100% EOU has paid Excise duty under Section 3 ibid r/w Sr. no. 2 of the said notification, the admissible quantum of Cenvat Credit be calculated in accordance with the formula prescribed under Rule 3(7) of Cenvat Credit Rules, 2004 whereas Section 3 of Central Excise Act provides that the duty charged by an EOU is a duty of Excise charged by 100% EOU and the amount of duty charged is one single amount and it does not contain any bifurcation like DCD,CVD etc. In the instant Appeal, it is not the case of the Revenue that the supplier i.e.100% EOU has availed the exemption under Serial No. 2 of Notification No. 23/2003, their only case is that the EOU supplier has availed benefit of exemption under serial no. 1 of the notification - It is settled position that Rule 3(7) ibid comes into operation only if the benefit has been availed under serial no. 2 of the aforesaid notification as the application of the said rule is conditional upon availing such exemption. In none of the authorities produce by Revenue it has been held that the aforesaid notification that Rule 3(7) will be applicable irrespective of the fact whether the supplier has availed exemption under serial no. 2 or not therefore, the authority cited by Revenue are not applicable on the facts of the present case - The Appellants are justified in taking credit of the amount of duty in issue. Extended period of limitation - HELD THAT:- The period involved in the matter is from April 2009 to April 2010 whereas the show cause notice was issued on 28/04/2014. The credit availed by the Appellant was being reflected in their credit account and therefore no suppression or malafide with intent to effect duty can be attributed to the Appellants - the demand is held to be time barred also. Appeal allowed - decided in favor of appellant.
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