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2016 (1) TMI 1011 - CESTAT CHANDIGARH

2016 (1) TMI 1011 - CESTAT CHANDIGARH - TMI - Cenvat credit lying unutilized in stock on 1.3.2003 denied - appellant has availed credit after a gap of one year - Held that:- As per Rule 3(1) of Cenvat Credit Rules, 2002 the appellant is entitled to Cenvat credit on the inputs in question which were either available in stock or in process or were contained in the final product lying in stock as on 1-3-2003, Thus, viewing the problem from any angle the appellant is entitled to claim Cenvat credit .....

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e Respondent : Shri R K Mishra, AR ORDER Per Ashok Jindal The appellant is in appeal against the impugned order wherein cenvat credit lying unutilized in stock on 1.3.2003 was denied to the appellant. 2. The facts of the case are that the appellant is manufacturer of medical disposal syringes and was paying duty on their final product by not availing cenvat credit on the inputs and paying duty at the rate of 4%. By Notification No.10/03-CE dated 1.3.2003, the appellant was allowed to take cenvat .....

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y the department, therefore, the appellant took cenvat credit on inputs/work in process lying in stock as on 1.3.2003. A show cause notice was issued to deny the cenvat credit to the appellant as the appellant is not covered by Rule 3(2) of Cenvat Credit Rules, 2002 to avail cenvat credit on inputs/work in process lying in stock as on 1.3.2003 and as the appellant has availed credit after a gap of one year, therefore, the cenvat credit not admissible to them. The matter was adjudicated by the ad .....

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submitted that both the issues have been decided by the Tribunal in the case of Eastern Medikit Ltd. vs.CCE - 2013 (288) ELT 423 (Tri.-Del.) and SAIL vs. CCE - 2013 (287) ELT 321 (Tri.-Del.) respectively. Therefore, the impugned order is set aside and the appeal be allowed. 4. On the other hand, learned DR reiterated the findings in the impugned order. 5. Heard the parties and perused the records. 6. After hearing the parties, we frame two issues in this case for consideration: (a) Whether the a .....

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ided finally by this Tribunal in the case of Eastern Medikit Ltd. (supra) wherein the relevant facts of the case as under:- 3. The appellant was availing benefit of Notification No.10/2002-CE, dated 1-3-2002 and paying Central Excise duty @ 4% on the value of their final product without availing benefit of cenvat credit till 28-2-2003. Under that Notification an assessee was allowed to clear his final product @ 4% ad valorem provided no Cenvat credit in respect of inputs gone in the manufacture .....

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e tune of 4% was partially taken away by increasing the rate of the excise duty payable from 4% to 8% ad valorem and the condition of non-availment of Cenvat credit by the assessee was done away with. Cumulative reading of the above referred two notifications clearly indicate that w.e.f. 1-3-2003 the exemption from excise duty on its final product available to the appellant prior to 1-3-2003 was partially withdrawn to the extent of 4% ad valorem by increasing the excise duty from 4% to 8%. Thus, .....

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on which any goods manufactured by the said manufacturer or producer cease to be exempted or any goods become excisable." 14. Otherwise also the case of the appellant is squarely covered under Rule 3(1) of Cenvat Credit Rules, 2002 which provides that a manufacturer or producer of final product shall be allowed to take Cenvat credit of the excise duty paid on the inputs received in the factory on or after 1-3-2002 provided such inputs are used in the manufacture of the final product subject .....

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tock or in process or were contained in the final product lying in stock as on 1-3-2003, Thus, viewing the problem from any angle the appellant is entitled to claim Cenvat credit under Rule 3 of Cenvat Credit Rules, 2002." 7. Therefore, relying on the above decision of this Tribunal, we hold that the appellants are entitled to take cenvat credit either under Rule 3(1) or Rule 3(2) of Cenvat Credit Rules, 2002. Accordingly, the issue No.(a) is decided in favour of the Appellant. 8. The issue .....

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2002 and Central Excise Rules,1944. 8. From a plain reading of the above provisions, it is clear that what the Rules prescribes is that a manufacturer can avail cenvat credit in respect of certain inputs immediately on their receipt and there is no time limit period prescribed in these rules in this regard, The word may in sub-rule of Rule 4 cannot be read as shall. The Departments contention would have been correct if sub-rule (1) of Rule 4 had provided that cenvat credit in respect of inputs s .....

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