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Volvola Corporation Versus Commissioner of Central Excise, Mumbai-III

Denial of Input credit - Non maintenance of separate accounts - Held that:- Requirement of Rule 6(3), wherein on assessee does not maintain separate records of inputs consumed in the manufacture of duty paid and exempted output, the assessee is required either pay an amount at the fixed percentage (10%/6%) of value of the exempted goods/services or pay an amount as determined under sub-rule (3A). Sub-rule (3A) provides for reversal of proportionate amount attributable to the inputs consumed in t .....

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filing or delayed filing of intimation under sub-rule (3A), as assessee cannot be required to pay the fix percentage by way of reversal under Rule 6(3), where the assessee have paid the amount by way of reversal which amounts to substantial compliance. It is further admitted fact that the assessee has intimated the fact of reversal by making categorical mention in the ER-1 returns. I hold that the appellant had made substantial compliance of sub-rule (3A) of Rule 6 of Cenvat Credit Rules. - Deci .....

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otification the appellant is liable to pay 10% as required under Rule 6(3) of CCR. 2. The brief facts of the case is that the appellants are engaged in the manufacture of goods industrial valves. The respondent manufactured and cleared the goods valued at ₹ 3,45,000/- vide Invoice No.11 dated 19.6.2008 to M/s. R.M.Shah & Co., Ahmedabad, without payment of duty by availing exemption under Notification No. 06/2006 dated 1.3.2006 and reversed Cenvat credit amounting to (Rs.5898+Rs.3308/-) .....

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ot be said that the reversal of credit at the time of clearance would amount to as if credit has not been taken. In the instant case, the appellants were required to maintain separate account for receipt, consumption and inventory of inputs and inputs services on which cenvat credit was availed, which they have failed to do. Records of the appeal do not show the appellants having opted to pay duty (by way of reversal) under Rule 6(3A) of the Cenvat Credit Rules which was introduced from 1.4.2008 .....

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on No. 06/2006 dated 1.3.2006. Thus, the appellant have been fastened with duty under Rule 6(3) of CCR to pay the amount of 10% only for the reason that the appellant had not followed the procedure and conditions laid down in sub rule (3A) of Rule 6 of the Cenvat Credit Rules. In view of the substantial compliance made (reversal on inputs duty) only for the procedural lapse of not giving intimation by way of submitting the intimation under Rule 3A, the appellant cannot be visited with an order t .....

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