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Cipla Limited Versus Commissioner of Central Excise, Mumbai-III

CENVAT credit - capital goods which was not installed and used in the factory - Subsequently the capital goods exported under drawback in terms of Section 74 of the Customs Act, 1962 - whether the denial of CENVAT credit on the ground that the capital goods was not put to use in the factory and cleared as such in terms of Rule 3(5) of the Cenvat Credit Rules, 2004, justified? - Held that: - the capital goods on which credit was availed, if it is cleared for export there is no need to reverse the .....

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lly entitled for the Cenvat Credit and need not to reverse the Cenvat Credit on the export of capital goods - appeal allowed. - E/1126/2011 - A/86930/16/SMB - Dated:- 9-3-2016 - Shri Ramesh Nair, Member (Judicial) Shri Rajesh Ostwal, Advocate for Appellant Shri H.M. Dixit, Asstt. Commr. (A.R) for respondent ORDER This appeal is directed against Order-in-Appeal No. PKS/566/BEL/2010 dated 5.4.2011 passed by the Commissioner (Appeals) Central Excise, Mumbai-III whereby the Ld. Commissioner upholdin .....

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to use in the factory and cleared as such in terms of Rule 3(5) of the Cenvat Credit Rules, 2004. If the capital goods is removed as such the duty equal to Cenvat Credit is required to be paid. The adjudicating authority has confirmed the demand of Cenvat Credit. Aggrieved by the adjudication order, appellant filed appeal before the Commissioner (Appeals), who upheld the Order-in-Original, on two counts (i) The clearance of capital goods as such requires reversal of Cenvat Credit, (ii) The appe .....

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(Tri.-Mumbai) (ii) Essel Propack Ltd. Vs. Commissioner of Central Excise, Thane 2014 (314) E.L.T. 584 (Tri.-Mumbai) As regard the claim of drawback, he submits that though the claim of drawback is of 98% in terms of Section 74 of the Customs Act, 1962. Subsequently they realized that their mistake as Cenvat Credit was availed on the capital goods, to this effect they submitted a letter of dt. 26.10.2010 to the drawback department for reduction of drawback. The drawback department also taken a no .....

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t of duty on removal of capital goods as such without being put to use. 5. I have carefully considered the submissions made by both the sides. Though the appellant have taken credit on capital goods but cleared as such for export. It is settled position, that whatever goods are exported from India, duty suffered on the said goods cannot be exported. Therefore, the capital goods which was exported by the appellant either can be cleared under claim of rebate or drawback under bond. In such a situa .....

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Rule 19 of the said Rules. In respect of the goods on which credit has been taken, Circular issued by Board in 1996 as well as in 2000, clearly says that the manufacturer assessee is entitled to clear the inputs or capital goods for export (on which credit has been taken) under bond without payment of duty. The decision of the Tribunal in the case of Videocon International Ltd. (supra) also confirms this view. 5.2 We also note that in the case of Essel Propack Ltd. decided vide Order No. A/1023/ .....

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pital goods, which was procured and subsequently re-exported. Accordingly, we allow the appeal for consequential relief, if any, in accordance with law. Similarly, in the case of Essel Propack Ltd.(supra) the Division Bench of this Tribunal on the identical issue held as under: 6. In this case it is a fact on records that these capital goods have been procured in the year 1997 and availed CENVAT credit and the same has been cleared for export on 19th July, 2005. As per the C.B.E. & C. Board .....

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