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2023 (9) TMI 716 - AT - Central ExciseCENVAT Credit - Recovery of 6% of the value of honey treating it an exempted goods cleared by the appellant - Rule 6(3)(i) of the CCR, 2004 - HELD THAT:- As regards credit of other services ISD applied provisions of rule 6(3)(ii) of Cenvat Credit Rules, 2004 and apportioned the remaining credit in production value ratio of all the units and such apportionment, only so much credit as proportionate to the taxable turnover of all the units was distributed by the ISD. The credit was not distributed by ISD was reversed at its end. For period post 01.04.2014 except the credit pertained to trading activity, the ISD distributed the entire credit among all the units in their production value ratio and thereafter the appellant themselves applied the provisions of rule 6(3)(ii) of CCR on cenvat credit distributed by the ISD in the ratio of taxable turnover to the total turnover during the preceding financial year on provisional basis and the same was adjusted by the appellant on the basis of final ratio by 30th June of the next financial year. On going through the said pre-show cause notice consultation letter and dropping proceeding against the appellant, it is clear that the appellant is reversing proportionate cenvat credit, as per Rule 6(3)(a) therefore appellant is not required to pay 6% of the value of Honey cleared by them. The provisions of rule 6 are not applicable to the facts of this case as Honey is not an exempted goods - the proceedings against the appellant are not sustainable under Rule 6 of the Cenvat Credit Rules, 2004. The impugned orders deserve no merits, accordingly the same are set aside - Appeal allowed.
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