TMI Blog2017 (2) TMI 712X X X X Extracts X X X X X X X X Extracts X X X X ..... liability of ₹ 18,69,311/- also paid, albeit belatedly on 23.12.2010. Matter remanded for verifying calculation of credits reversed - appeal allowed by way of remand. - E/2088/2011 - A/31534/2016 - Dated:- 9-11-2016 - Ms. Sulekha Beevi, C.S., Member (Judicial) And Mr. Madhu Mohan Damodhar, Member (Technical) Shri M. Narayana Swamy Naidu, AR for the Appellant. Shri Arun Kumar, AR for the Respondent. [Order per: Madhu Mohan Damodhar] The issue in dispute concerns ineligibility of certain amount of CENVAT credit of the Central Excise duty availed on common inputs used in the manufacture of excisable and exempted final products. 2. A Show Cause Notice dated 08.05.2010 was issued to appellant demanding the amount of Rs.Rs.72,23,44,335/- involved in the clearances of exempted goods without reversing an amount 10% / 5% for the period April, 2005 to September 2009 along with interest and also proposal for imposing penalty. In adjudication, lower authority has confirmed the proposals in show cause notice i.e. duty demand, interest and equal amount of penalty. Aggrieved by the said order, the appellant has filed appeal. 3. Today, when the matter came up ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pellant's records was carried out in August 2009 when it appeared to department that while clearing the exempted goods, appellants were not reversing 10% of value of exempted goods (5% from July 2009) as required under sub-rule 3(b) / 3(i) of Rule 6 of Cenvat Credit Rules, 2004 . (b) Consequent to audit, show cause notice dt. 8.5.2010 was issued to appellant proposing demand of ₹ 72,23,44 335/- involved in the clearances of exempted goods cleared without reversing 10% / 5% from April 2005 to September 2009, along with interest liability thereof and imposition of penalty under Rule 25 of the Cenvat Credit Rules, 2002 read with Section 11AC of the Central Excise Act, 1944. (c) Trade Notice No 25/2010 (C.EX) dt. 16.9.2010 was issued by Commissioner of Customs and Central Excise, Hyderabad-II conveying that as per the provisions of Section 69 and 73 of the Finance Act, 2010, Central Excise Rules / Cenvat Credit Rules are amended retrospectively providing the manufacturer an option to pay an amount equivalent to such credit attributable to input or input services used in, or in relation to the manufacture of such final products which are not chargeable to duty or cha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... with interest, which shall be paid within a period of 10 (ten) days from the date of receipt of the communication from the Commissioner in this regard. (d) In terms of this Trade Notice, appellant filed an application dt. 23.12.2010 to the Commissioner of Central Excise, Hyderabad-II informing that (i) the total value of cenvat credit availed on common inputs like Lubricants Fuels was ₹ 34,58,810/- (ii) the amount of cenvat credit to be reversed on common inputs used for exempted final products was ₹ 23,06,122/- (iii) they have reversed an amount of ₹ 23,06,207/- as per record in Form RG 23A (Part-II), vide entry Sl.No.88 on Page No. 11 dated 02.11.2010. (iv) they have reversed an excess amount of credit of ₹ 85/- (v) total interest payable due to delay in reversal of admissible cenvat credit availed on fuels lubricants worked out to ₹ 18,69,311/- for the period from 01.04.2005 till November 2010 (i.e. the month in which inadmissible credit was reversed by them) and (vi) based on the certificate furnished by M/s. SS Zanwar Associates, Cost Accountants, an amount of ₹ 18,69,311/- was paid by them towards interest on 23.12.2010 by way ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Finance Bill got the assent of the President of India. The delay in filing the application and payment of interest is despite the fact that M/s. MIDHANI are aware of the amendment to Rule 6 of Cenvat Credit Rules, 2004, communicated through the Trade Notice No.25/2011 cc.Ex) dated 16.09.2010 issued by Hyderabad-Il Comissionerate. Further, M/s. MIDHANI were also informed by the jurisdictional Range Officer vide his letter dated 13.10.2010 about these provisions and also to file such application before 07.11.2010; since the assessee has not complied with the statutory requirement of payment of interest/filing the application within a period of six months from the date on which the Finance Bill, 2010 received the assent of the President, I hold that the demand of an amount @ 10% is sustainable. 7. Looking into the totality of the facts, we are of the considered opinion that when the quantum of inadmissible credits for the period of dispute has been reversed within 6 months from the date on which the Finance Bill, 2010 received the assent of the Hon ble President of India and also has satisfied the terms of the Trade Notice No.25/2010 dt. 16-09-2010, a fact confirmed by the adju ..... X X X X Extracts X X X X X X X X Extracts X X X X
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