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2016 (8) TMI 387 - CESTAT BANGALORE

2016 (8) TMI 387 - CESTAT BANGALORE - TMI - Reversal of cenvat credit - Rule 6(3) read with Rule 6(3A) of CENVAT Credit Rules (CCR), 2004 - clearance of two cranes at nil rate of duty - availed benefit of Notification No.33/2005-C.E. dated 8.9.2005 as amended vide Notification No.38/2005-C.E dated 30.12.2005 - not maintained separate books of accounts and also did not exercise the option as provided in Rule 6(3) read with Rule 6(3A) of the CCR, 2004. - Held that:- admittedly there is no inti .....

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le (3A) is only a procedure contemplated for application of Rule 6(3). Consequently, the argument of Revenue is that the appellants exercising option is mandatory and on its failure, the appellant has no other option but to accept and apply Rule 6(3)(i) and make payment of 5%/10% of the sale price of the exempted goods or exempted services is not acceptable, because the Rule does not lay down any such restriction and this has been held in various judgments. It has been held in one judgment that .....

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13.3.2012 which is beyond the period of one year and the allegation of the Department regarding suppression of fact is also not tenable because the appellant has disclosed these facts in their periodical ER1 returns filed by them. Therefore, the impugned order is not sustainable on merit as well as on limitation and therefore, set aside. - Decided in favour of assessee - E/21578/2014-SM - Final Order No. 20617/ 2016 - Dated:- 8-8-2016 - Shri S. S. Garg, Judicial Member And Shri Ashok K. Arya, T .....

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ane stares falling under the Chapter Heading 84 of the Central Excise Tariff Act. The appellant cleared two cranes at nil rate of duty vide invoice dated 17.10.2008 and 13.11.2008 by availing the benefit of Notification No.33/2005-C.E. dated 8.9.2005 as amended vide Notification No.38/2005-C.E dated 30.12.2005. During the audit, an objection was raised requiring the appellant to pay 10% of the amount as per Rule 6(3) of CENVAT Credit Rules (CCR), 2004 on the ground that the appellant herein had .....

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d vide his order dated 31.1.2014 learned Commissioner (Appeals) set aside the Order-in-Original and hence the present appeal. 2. Learned counsel for the appellant submitted that the impugned order passed by the learned Commissioner (A) is misconceived and has been passed by ignoring the precedents on the issue as well as the correct interpretation of Rule 6(3). He further submitted that the learned Commissioner (A) has wrongly assumed that the adjudicating authority has erred in reducing the amo .....

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ble to the facts of the present case. He further submitted that the entire demand with interest and penalties as upheld in the impugned order is hit by limitation/time bar as the charges of suppression cannot be sustained at all as the appellant has disclosed the clearance of two cranes in their periodical ER1 returns and the demand could not have been made by alleging suppression and invoking the extended period of limitation, particularly when the whole issue pertains to interpretation of requ .....

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.1 Learned counsel further relied upon the following decisions in support of his submission that once appellants have reversed the proportionate CENVAT credit without intimating the Department, they cannot be denied the benefit under Rule 6(3) read with Rule 6(3A) of CENVAT Credit Rules. * Sri Sarvaraya Sugars Ltd. vs. CCE: 2010 (251) E.L.T. 418. * Ruchi Infrastructure Ltd. vs. CCE: 2008 (224) E.L.T. 123 * BEML Ltd. vs. CCE: 2015-TIOL-1149-CESTAT-BANG. * CCE vs. ICMC Corporation Ltd.: 2015 (315) .....

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of exempted goods or for providing exempted services. Sub-rule (ii) of Rule 6(3) states that in case the manufacturer or service provider uses common inputs/input services then such manufacturer or service provider has to maintain separate accounts and the credit is to be taken only on that quantity of input or input services which is intended for manufacture of dutiable goods or providing exempted services. Sub-rule (iii) of Rule 6 speaks about the situation where such manufacturer or service p .....

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empted services; or b) Reverse the credit on inputs and input services pertaining to exempted goods and exempted services as per the procedure and conditions prescribed in Rule 6(3A), and it also prescribes the formula for calculation of the proportionate credit to be reversed. 4.1 On analysis of Rule 6(3A), I find that while exercising the option, the manufacturer of goods or the provider of output service shall intimate in writing to the Department regarding the option exercised. In the presen .....

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