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2014 (7) TMI 193 - CESTAT NEW DELHICENVAT Credit - Manufacture of exempted goods in partial year - assesee is paying 8% of the value of exempted goods - revenue seeks to reversal for the entire credit - Held that:- It may happen that on one day the appellant may manufacture only dutiable product and on the other they may only manufacture exempted product. Whether in such a scenario, the duty liability of the assessee is required to be assessed based upon day to day basis? The answer would be an emphatic ‘NO’. The periods cannot be segregated in that manner so as to finalize the assessee liability. Accordingly, there is no warrant to do so in terms of the Cenvat credit Rules. It seems that in the present case the amount of 8% was much lower than the amount of credit so availed, thus prompting the revenue to take a reverse stand than the one taken by them in routine i.e. to in 8% of the value of the final product, which in most of the cases is higher than the credit involved - Cenvat credit cannot be disallowed if an assessee manufactures only exempted goods for a part of the year and for the balance year manufactures both exempted and dutiable goods - Decided in favour of assessee.
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