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2016 (10) TMI 908 - AT - Central ExciseReversal of CENVAT credit of CVD - manufacture of Insulated Wires and Cables falling under Chapter 8544 of the Central Excise Tariff Act - credit of the CVD paid, availed on imported capital goods - whether the denial of CENVAT credit on the ground that capital goods was found defective and were re-exported by the appellant under bond without payment of duty justified? - qualification as capital goods as defined in Rule 2 (a) of the Cenvat Credit Rules, 2004 - Held that: - It is not in dispute that the appellants have re-exported the defective capital goods without putting them to use. They have cleaned these goods "as such" under bond and export the goods without payment of duty. Para 3.4 of Chapter 5 of CBEC Central Excise Manual reads as follows - "3.4 There is no bar for a manufacturer to remove the inputs or capital goods "as such" for export under bond". - Therefore, the respondent cannot be faulted for removing the goods without payment of duty for export. Reliance placed on the decision of case of Glass and Ceramic Decorators vs. CCE, Mumbai - I [2014 (9) TMI 864 - CESTAT MUMBAI] where it was held that In respect of the goods on which credit has been taken, Circular issued by Board in 1996 as well as in 2000, clearly says that the manufacturer assessee is entitled to clear the inputs or capital goods for export (on which credit has been taken) under bond without payment of duty. The CBEC has also in the clarified Circular dated 29/8/2000 that there is no bar for manufacturer to export inputs and capital goods under bond. In any case if the capital goods would have been cleared for export on payment of duty the same would have been allowed as rebate to the respondent as per the provisions of Rule 19 of the Central Excise Rules, 2002. Demand of reversal of the Cenvat credit not justified - appeal dismissed - decided against Revenue.
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