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2016 (8) TMI 381 - CESTAT CHENNAI

2016 (8) TMI 381 - CESTAT CHENNAI - TMI - Cenvat credit - Whether the appellants are eligible for taking Cenvat credit of 100% on Capital goods in the first year itself - Held that:- since the appellants have taken 100% Cenvat credit in the first year itself, whereas in terms of Rule 4(2) of Cenvat Credit Rules, 2004, they were required to avail 50% of the credit in the first year and balance 50% in the subsequent financial year (s). However, the fact that they availed the entire 100% credit in .....

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vailability of Cenvat credit to a manufacturer on receipt of capital goods once the goods are received and as long as such goods are in possession and use of the manufacturer of final product. Appeal allowed by way of remand - E/41442/2015 - FINAL ORDER Nos. 41019/2016 - Dated:- 10-6-2016 - Shri P.K. Choudhary, Judicial Member Shri M. Kannan, Adv., For the Appellant Shri R. Subramaniyan, AC (AR) For the Respondent ORDER M/s. Sundram Fasteners Ltd., the appellant herein are the manufacturers of B .....

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11 AC of CEA, 1944. On adjudication, the adjudicating authority confirmed the demand of ₹ 2,79,260/- and appropriated the same towards the amount payable by them along with interest. He appropriated an amount of ₹ 11,850/- towards interest on the above demand and imposed equivalent penalty under Rule 15 (2) of CCR read with Section 11 AC of the Act. On appeal the Commissioner (Appeals) upheld the order of the adjudicating authority and rejected the appeal filed by the appellants. Hen .....

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t. This is a mistake and there is no deliberate intention to avail ineligible credit. He further submits that since the credits sought to be disallowed is available, there could be recovery of interest for availing additional 50% credit in the first year instead of subsequent year. He relies on the judgement of the Hon ble High Court of Gujarat in the case of CCE Vs. Indian Oil Corporation Ltd. - 2014 (305) ELT 507 (Guj.) in support of his contention. He submits that the issue has been settled b .....

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y after verification of records by the audit, the availment of ineligible cenvat credit by them came to the surface otherwise it might have gone unnoticed. Hence, the appellants have clearly contravened the provisions of the Act, for which penalty proceedings were rightly initiated. 4. Heard both sides and perused the records. The short issue to be decided in this appeal is whether the appellants are eligible for taking Cenvat credit of 100% on Capital goods in the first year itself. Rule 4 (2) .....

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