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M/s. Zabatex Textiles India Pvt. Limited Versus Commissioner of Central Excise & S.T., Vapi

2016 (3) TMI 345 - CESTAT AHMEDABAD

Disallowance of CENVAT credit - appellant is engaged in the manufacture of Textile Articles, classifiable under Chapter 58 and 60 of the Schedule to the Central Excise Tariff Act, 1985 - whether the appellant has rightly taken CENVAT credit on the inputs received from 100% EOU, during the period 2006-07 to 2009 (i.e. August 2009) - Held that:- Denial of Cenvat Credit is related to calculation error, which the appellant has already paid alongwith interest and imposition of penalty is not justifia .....

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he Central Excise Tariff Act, 1985. The adjudicating authority disallowed the CENVAT credit amounting to ₹ 12,01,233/- alongwith interest and imposed penalty of equal amount of CENVAT credit for the period 01.4.2006 to 06.9.2009. 2. The learned Advocate on behalf of the appellant fairly submits that they are not disputing the demand of CENVAT credit of ₹ 4,61,879/-, which is a calculation error. He submits that they have already debited an amount of ₹ 4,61,879/- alongwith inter .....

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7 (Tri. Del.) 3. Learned Authorised Representative for the Revenue reiterates the findings of the adjudicating authority. He submits that Cenvat Credit on Additional duty under sub-Section 5 of Customs Tariff Act has been allowed vide Notification No. 22/2009-CE (NT) dated 07.09.2009, which was inserted in the Rule 3(7) of the Cenvat Credit Rules. He submits that the decisions relied upon by the learned Advocate had not considered that there is no express provisions in the said amendment would b .....

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the appellant is eligible to avail credit on the Additional duty leviable under Section 3(1) of the Customs Tariff Act, which is equal to the duty of excise under Section 3(1) (a) of the Central Excise Act, on or after 07.09.2009. For the proper appreciation, relevant portion of the said Rule is reproduced below:- (7) Notwithstanding anything contained in sub-rule (1) and (7) sub-rule (4), - (a) CENVAT credit in respect of inputs or capital goods produced or manufactured, by a hundred per cent. .....

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under section 3 of the Excise Act read with serial number 2 of the notification No. 23/2003-Central Excise, dated the 31st March, 2003, [G.S.R. 266(E), dated the 31st March, 2003], shall be admissible equivalent to the amount calculated in the following manner namely :- Fifty per cent. of [X multiplied by {(l+BCD/100) multiplied by (CVD/100)}], where BCD and CVD denote ad valorem rates, in per cent., of basic customs duty and additional duty of customs leviable on the inputs or the capital good .....

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ll be equal to [X multiplied by [1+BCD/200) multiplied by (CVD/100)]: [Provided further that the CENVAT credit in respect of inputs and capital goods cleared on or after 07th September 2009 from an export oriented undertaking or by a unit in Electronic Hardware Technology Park or in a Software Technology Park, as the case may be, on which such unit undertaking or unit has paid (i) the additional duty leviable under sub-section (1) of section 3 of the Customs Tariff Act, which is equal to the dut .....

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ember Bench in the case of Metaclad Industries vs. CCE, Mumbai. Relevant portions of the decision in the case of Metaclad Industries (supra) are reproduced below:- 2. The main appellant, M/s. Metaclad Industries availed CENVAT credit of the excise duty paid on the goods procured from a 100% EOU. The said duty comprises of various components such as Basic Customs duty, Additional Customs Duty leviable under sub-section (1) and sub-section (5) of Section 3 of Customs Tariff Act, 1975, Education Ce .....

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Shri Suketu Vasant Jariwala, a partner of the appellant-firm. The appellants preferred appeals before the lower appellate authority who vide the impugned order rejected the appeals and hence the appellants are before me. 5.1 The levy on the goods cleared from a 100% EOU to DTA is an excise duty as provided for in Section 3 of the Central Excise Act. For the purposes of arriving at the rate of duty, it has been prescribed in the said section that the rate of excise duty on goods cleared from an E .....

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