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2015 (4) TMI 1030 - CESTAT MUMBAI

2015 (4) TMI 1030 - CESTAT MUMBAI - TMI - Cenvat/Modvat Credit - Whether cenvat credit eligibility is to be determined with reference to dutiability of the final product on the date of receipt of the goods or the date of utilization of 50% credit - Held that:- CENVAT credit eligibility is to be determined with reference to the dutiability of the final product on the date of receipt of capital goods. - facts herein is squarely covered by the ruling of the Larger Bench of this Tribunal in the case .....

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ure of exempted goods, CENVAT credit was not available, but subsequently the finished products became taxable and accordingly the assessee was entitled to take CENVAT credit in the second year, as the end product was taxable. 2. The respondent-assessee is absent in spite of notices served. The assessee had filed a request for adjournment on 13/2/15, same was allowed and next date was fixed on 20/3/15 on which date the appeal was restored to its original number, as the earlier final Order No. A/7 .....

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Tri.-Bang.), which order has been over ruled by the Larger Bench of this Tribunal in the case of Spenta International Ltd. Vs. Commissioner of Central Excise, Thane reported in 2007 (216) ELT 133 (Tri.-LB), order dated 01.08.2007. 3. Heard the learned A.R. and perused the records, I find that the respondent-assessee is a manufacturer of plain & pre-laminated particle boards falling under chapter 44 of the Central Excise Tariff Act, 1985. Prior to 1/3/2006 the respondent-assessee was availing .....

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n the stock vide their letters dated 31/3/2006, in view of the notification number 4/2006. The respondent-assessee also started paying Central Excise duty on their final products with effect from 1/3/06. During the scrutiny by the Revenue of the transitional claim it was noticed that the assessee have taken initial 50% CENVAT credit of ₹ 76,153/- on capital goods which was received in the factory premises on 30/6/04, as appeared from GRN and mentioned in the statement prepared by the respo .....

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tory on 30/6/2006 which was prior to the date, that is 10/9/04, and hence the credit on the said goods was not admissible and accordingly was required to show-cause to why not the amount of CENVAT credit ₹ 76,153/- should not be disallowed and recovered along with interest & penalty. The respondent-assessee appeared and contested the show-cause notice and also filed written submissions stating that as per Rule 4(2)(a)&(b) the CENVAT Credit Rules, 2004, in respect of capital goods r .....

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or 2006-07. As the respondent-assessee have taken only 50% credit, as an abundant precaution, there is no illegality. Further, the respondent-assessee is relying on the ruling of this Tribunal in the case of Ace Timez Vs. Commissioner of Central Excise, Bangalore reported in 2004 (170) ELT 371 (Tri.-Bang, wherein this Tribunal had held that credit on capital goods not taken during the period when final product was exempted, could be taken when the exemption was withdrawn and final products becom .....

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pellant had preferred appeal before the Commissioner (Appeals) who was pleased to allow the appeal relying on the ruling of this Tribunal in the case of Ace Timez Vs. Commissioner of Central Excise, Bangalore (supra). Being aggrieved the Revenue had preferred appeal before this Tribunals and vide final order as mentioned hereinabove the appeal was dismissed, which now stands restored in view of the order of the Hon'ble High Court. 5. On examining the Larger Bench view of this Tribunal, in th .....

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of the capital goods were used in March, 2003. CENVAT credit on the goods had been denied on the ground that final products - socks, were exempt at the time of receipt of capital goods, on the basis of the Tribunal s decision in Commissioner of Central Excise, Indore Vs. Surya Roshni Limited reported in 2003 (155) ELT 481. The Larger Bench of this Tribunal took notice of the ruling of the Honble Supreme Court in the case of Commissioner Vs. Surya Roshni Limited 2003 (158) ELT A273 (S.C.), holdi .....

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