Home Case Index All Cases Central Excise Central Excise + AT Central Excise - 2022 (2) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2022 (2) TMI 57 - AT - Central ExciseCENVAT Credit - capital goods - input services - credit utilized for payment of duty at 4% on cotton yarn exported by them - capital goods used exclusively for the manufacture of exempted goods - credit denied on capital goods when they have opted to avail benefit of ‘Nil’ rate of duty under the Exemption Notification - simultaneous availing the benefit of Notification 29/2004 as amended by Notification 58/2008 and another Notification 59/2008 - period (07.12.2008 to 06.07.2009) - applicability of Board’s circular dated 26.11.2010 - HELD THAT:- In the present case, the appellants were paying duty @ 4% on the goods manufactured by using the very same capital goods. There is no room for doubt that the capital goods were not exclusively used for manufacture of exempted goods. The Tribunal in the case of ST. COTTEX EXPORTS (P) LTD. VERSUS COMMISSIONER OF C. EX., LUDHIANA [2010 (1) TMI 1048 - CESTAT NEW DELHI] had occasion to analyse this issue in regard to Notification No.30/2004-CE and Notification No.29/2004-CE. and it was held that Under sub-rule (4) of Rule 6 of Cenvat Credit Rules, 2004, capital goods Cenvat credit is inadmissible only in respect of those capital goods which are exclusively used in the manufacture of exempted goods. In present case it cannot be said that the capital goods in question had been used exclusively for the manufacture of fully exempted finished products. Though it is alleged in the show cause notice that the appellants have availed credit on input services, the Ld. Counsel for appellants has asserted that the issue is with regard to disallowance of credit on capital goods only. The disallowance of credit cannot be justified - appeal allowed - decided in favor of appellant.
|