2023 (1) TMI 388 - AT - Central Excise

CENVAT Credit - capital goods - availment of 100% credit on wooden dies, aluminum litho plates and rubber blanket under the category of inputs - Revenue is of the view that these are capital goods and therefore only 50% credit should have been taken in first year - Seeking reversal of Cenvat credit, interest and imposition of penalty - time limitation - HELD THAT:- The issue involved in the case GUARDIAN PLASTICOTE LTD. VERSUS COMMISSIONER OF C. EX., DAMAN [2008 (12) TMI 534 - CESTAT, AHMEDABAD] is similar to the issue involved in the instant case that using engraved printed cylinder is an inputs. It was held by the Tribunal that on the ground of limitation, the demand for the period beyond one year from the date of show cause notice fails. I also agree with the ld. Advocate’s argument that the lower authorities have not considered as to whether the cylinder can be considered as an input. This aspect needs to be considered in detail. Therefore the matter has to go back to the Original Adjudicating Authority to consider whether cylinder can be considered as an input or it has to be treated as capital goods.

It is noticed that in the instant case also, the nature of goods being capital goods or inputs, can be a matter of opinion - Relying on the decision of the Tribunal in the case of Guardian Plasticote Limited vs.CCE, Daman and the fact that the learned Counsel has admitted that they are ready to pay interest for the disputed period, the appeal is partly allowed. The matter is remanded to the Adjudicating Authority to calculate the amount of interest involved. In the facts of the case, the penalty is set-aside.

The appeal is allowed by way of remand to the Adjudicating Authority.