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2015 (9) TMI 293 - MADRAS HIGH COURT

2015 (9) TMI 293 - MADRAS HIGH COURT - 2015 (324) E.L.T. 295 (Mad.) - Denial of CENVAT Credit - Rule 9A - Transitional provisions for textile and textile articles - physical content of the inputs in process - claim rejected towards process loss - Held that:- Right from the stage of issue of show cause notice upto the stage of the order of the Tribunal, the claim of the appellant that they incur a manufacturing loss to the extent of 5% of the total quantity of the finished product, has not been d .....

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making a claim for CENVAT credit, with reference to the total quantity and the value of the inputs that went into the making of the fabric. - Decided in favour of assessee. - Civil Miscellaneous Appeal No. 2350 of 2006 & M. P. No. 1 of 2006 - Dated:- 13-8-2015 - V. Ramasubramanian And K. B. K. Vasuki, JJ. For the Appellant : Mr. S. Jaikumar For the Respondent : Mr. A. P. Srinivas, SPC ORDER Judgment was delivered by V. Ramasubramanian, J. This appeal is filed by the assessee under Section 130 o .....

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VAT credit on the stock declared on 1.4.2003 and utilized the same for payment of duty towards clearance of knitted garments manufactured by them, a show cause notice dated 8.7.2004 was issued. The appellant gave a reply on 29.7.2004. Thereafter, a personal hearing was conducted and the Commissioner of Central Excise passed an Order in Original dated 3.11.2004, disallowing a claim for CENVAT credit and ordering the recovery of credit amount of ₹ 7,06,433/-, apart from directing the appella .....

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ore the first respondent. The appeal was disposed of by the Tribunal by an order dated 6.2.2006 sustaining the orders in principle, but setting aside the quantum of duty and penalty and remitting the matter back to the Original Authority for re-quantifying the duty and penalty. On the question, in relation to which, the first respondent remanded the matter back to the Original Authority, the appellant has no difficulties. But, on the point that was sustained by the Tribunal in principle, the app .....

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he Central Excise Rules, 2002 is 'relevant date' for the purpose of Section 11A of the Central Excise Act, 1944 and not the last date on which the return envisaged under Rule 7(5) of the CENVAT Credit Rules, 2002 ought to have been filed ? (c) Whether the relevant date as defined in Section 11A(3)(ii)(a)(A) or 11A(3)(ii)(a)(B) of the Central Excise Act, 1944 is applicable for the given case ? and (4) Whether the return prescribed under Rule 12 of the Central Excise Rules, 2002 or the ret .....

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nd textile articles - (1) A manufacturer, producer, first stage dealer or second stage dealer of goods falling under Chapter 50 to 63 of the First Schedule to the Tariff Act, shall be entitled to avail credit equal to the duty paid on inputs of such finished product, lying in stock or in process or contained in finished products lying in stock as on 31st day of March 2003 upon making a written declaration of the description, quantity and value of the stock of inputs (whether lying in stock or in .....

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in stock as on 31.3.2003. Rule 9A deals with three items. They are (i) finished products lying in stock (ii) the products lying in process and (iii) those contained in finished products. The appellant has not made a claim in respect of the entire quantity and value of the inputs that had gone into the making of the finished products. 10. Incidentally, it should be pointed out that the appellant uses yarn, on which, excise duty is paid. This yarn is made into fabric and the fabric is made into ga .....

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ng in store. 11. To put it in simple terms, what the appellant claimed was that if X kg of fabric was lying in stock on the relevant date, the inputs that had gone into the making of the said quantity was X plus something. The only question that falls for our consideration is as to whether that something is actually entitled to CENVAT credit or not ? 12. Keeping the above in mind, if we get back to the scope of Rule 9A, it is seen that there are three expressions used. They are (i) inputs of suc .....

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