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2014 (2) TMI 278 - AT - Central ExciseAvailment of CENVAT Credit - CENVAT Credit on furnace oil/ lubricants etc. where job work formalities was not followed - cenvat credit with respect to angles, channels, CTD bars etc. used in the construction inside the factory is admissible or not - Held that:- Cenvat Credit of inputs will be admissible to an assessee when the inputs are sent to a job worker and after undertaking the required manufacturing processes the final products can also be cleared on payment of duty from the premises of the job worker subject to imposition of certain conditions. The only irregularity committed by the appellant was that they did not follow the prescribed procedures. It has been a settled position of law now that a substantial benefit of cenvat credit cannot be denied for not following the prescribed procedures when it is not disputed that inputs on which credit is taken have been utilized for manufacture of final product on which Central Excise Duty has been paid/payable. Cenvat credit with respect to inputs, sent to the power plant by the clinker unit for generation of electricity sent to grinding unit, can not be denied to the appellant for not following the prescribed procedures of Rule 4(5)(a) and Rule 4(6) of the Cenvat Credit Rules 2004 which allowed the appellant to send the clinker to grinding unit under job work and then clear the finished goods from the job worker’s factory premises when diversion of inputs/electricity is not alleged by the Revenue. Appeal filed by the appellants with respect to cenvat credit taken on structural items, electricity supplied to DMW plant used for supplying de-mineralized water to Gujarat Water Board and electricity supplied to residential colonies of the appellant is rejected. Appeal of the appellant with respect to Credit of inputs used for generating and supplying electricity to the grinding unit of the same group companies is allowed. As the issue of admissibility of cenvat credit on this inputs in the present proceedings was highly contentious and debatable this case is not fit for imposing penalties upon the appellant where credit is disallowed and are accordingly set aside - Decided in favour of assessee.
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