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2020 (2) TMI 685 - AT - Central ExciseCENVAT Credit - manufacture of dutiable as well as exempt goods - Rule 6(3) of Cenvat Credit Rules - non-maintenance of separate records - HELD THAT:- It is an admitted fact that the appellant has kept separate records, as required under Rule 6(2) of inputs and capital goods w.e.f. 1.7.2014/1.4.2015. Further, the admitted fact is that the appellant has kept common records of only few common input services, which is of negligible amount and further, the turnover of exempted goods is also negligible as compared to dutiable goods. Further, the appellant has reversed cenvat credit, on being so advised by the Department of the credit attributable to the exempted goods, under intimation to the Department. Thus, it amounts to not taking of cenvat credit at all with respect to the exempted goods. Cenvat credit cannot be denied as it is held that the substantial benefit should not be denied for small procedural lapse. Further, it has been repeatedly held that Rule 6(2) read with Rule 6(3) is not the charging section or provision, it is only the mechanism to reverse the cenvat credit involved in the exempt out (finished goods) by way of a convenient formula. The impugned order suffers with impropriety and the same is mis-conceived - Appeal allowed - decided in favor of appellant.
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