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TMI Blog2010 (10) TMI 424X X X X Extracts X X X X X X X X Extracts X X X X ..... is required to reverse credit equivalent to credit taken when used capital goods are removed from the factory or not?" 2. The brief facts, which are required to be stated, are that the first respondent is the manufacturer of cotton yarn, which avails cenvat credit facilities. They sold their Cenvat availed capital goods on payment of duty by adopting the transaction value at the time of subsequent sale instead of the value for which the Cenvat credit was originally taken on the inputs or capital goods. A show cause notice dated 30-12-2004 was issued determining the differential duty. The lower adjudicating authority confirmed the differential duty of Rs. 1,11,912/- with appropriate interest and also imposed penalty of equal amount. 3 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as such" used in Rule 3(4)(c) of the Cenvat Credit Rules, 2004 would only mean the value to be taken at the time of its initial procurement and it cannot permit the availing of depreciated value even if the capital goods were substantially used and disposed of after such use. 5. Though the contention of the learned Standing Counsel appears to be very sound in the first blush, we are not in a position to accede to the said submission. Rule 3(4)(c) of the 2004 Rules reads as under : "When inputs or capital goods, on which Cenvat credit has been taken, are removed as such from the factory, the manufacturer of the final products, shall pay an amount equal to the credit availed in respect of such inputs or capital goods and such removal s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... along with Board's letter dated 26-5-1993, it is quite clear that the inputs or capital goods when disposed of after putting it into some use over a period of time, then the assessee would be entitled to reverse whatever Cenvat Credit availed on the value to be assessed on the date of such subsequent sale as capital goods. Such a conclusion by relying upon the above referred to Board's Circular and the letter as well as the addition of proviso to Rule 3(5) with effect from 13-11-2007, is the manner in which the expression 'as such' used in Rule 3(4) can be interpreted. Consequently, the interpretation put in the order of the Principal Bench reported in 2009 (242) E.L.T. 124 merits acceptance. The order of the Tribunal impugned in this appea ..... X X X X Extracts X X X X X X X X Extracts X X X X
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