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2016 (12) TMI 841 - CESTAT NEW DELHIDemand of 10%/ 5% of the value of electricity - Rule 6 (3) of the Cenvat Credit Rules, 2004 - certain common inputs as well as input services used in the manufacture of dutiable final products as well as in the production of electricity - no separate records maintained - credit already reversed - Held that: - The Hon’ble Supreme Court in the case of Chandrapur Magnet Works (P) Ltd. vs. CCE, Nagpur [1995 (12) TMI 72 - SUPREME COURT OF INDIA] has held that once cenvat credit is reversed, it is to be considered ab initio not availed. In the light of this judgement of the Hon’ble Supreme Court, the reversal of cenvat credit already made by the appellant is to be considered as not taken ab initio - there is no justification for demand of the amount equivalent to 10%/ 5% of the value of electricity wheeled out. We are of the considered view that the failure of the appellant to follow the procedure perfectly should not come in the way of extending the substantial benefit of proportionate reversal. However, we find that in the order passed by the lower authority, he has not given any finding as to whether the reversal already made satisfies the test of proportionate reversal in terms of quantum of reversal. Hence, we are of the considered opinion that the matter is to be remanded to the original adjudicating authority to verify whether the amount of cenvat credit already reversed alongwith interest satisfies the requirement of proportionate reversal - appeal allowed by way of remand.
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