TMI Blog2017 (5) TMI 745X X X X Extracts X X X X X X X X Extracts X X X X ..... nvat account for all the units comprised in one registration - there is no reason to deny the credit on capital goods availed for installing and setting up of MGU prior to grant of single registration. Denial of Credit also on the ground that the credits pertain to the period prior to the issue of a common registration on 31.01.2014 - Held that: - The stand taken by the adjudicating authority for denying the Cenvat credit on input services was not taken in the relevant Show Cause Notice and to this extent the Order-in-Original has travelled beyond the scope of Show Cause Notice, which is illegal - In any case the adjudicating authority has not given specific findings as to which are the input services for which credit has been availed a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Grinding Unit (MGU) within a distance of two Km from the Original Unit. When the MGU was nearly completed the appellant approached the department for including the MGU in the registration already granted to the Cement Manufacturing unit. Accordingly, the Original Registration Certificate was amended to include the MGU. However, subsequently the department changed its stand and challenged the order of the lower authority granting the common registration. The issue was finally decided in favour of the appellant by the Tribunal vide final order No. A/53424/2015 dated 06.11.2015. The appeal filed by the department against the Tribunal order to the Hon ble Rajasthan High Court was dismissed through, its order dated 25.5.2016. Consequently, the c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... premises. Such clearances will be entitled to the benefit of captive consumption under Notification No. 67/95, dated 16.03.1995. iii. The Cenvat credits are have been denied also for the reason that the credits have been availed prior to registration of the MGU. It is settled law that Cenvat credit availed prior to registration of the unit in respect of inputs/services used for setting up can be availed even though the registration will be issued only after the unit becomes operative. iv. The credit availed on input services has been denied citing the amendment to the term input services made w.e.f. 01.04.2011. It has been considered that all the input services have been used for construction of a building or civil structure or for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ied through the impugned order to the extent of about ₹ 13.72 crores. The main ground cited in the Show Cause Notice for such denial is that both the units obtained common registration only on 31.1.2014 and for the period prior to this date, both the units had separate existence for the purpose of Central Excise law and hence the credit which might have been allowable to setting up of MGU cannot be allowed to be taken in the original unit, since the inputs were procured and inputs services were utilized prior to 31.01.2014. 7. The procurement of capital goods as well as utilization of input services for setting up the MGU happened prior to setting it up. The question of registration of the completed unit comes up after the unit is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... en in the preceding paragraph, the sugar unit and the distillery unit belonged to the self-same management and they are in the same premises. Although there are two units functioning, it is not denied by the Revenue that the resultant Molasses from the manufacture of sugar was used by the assessee in the manufacture of denatured Ethyl Alcohol. Although in respect of two activities, it had maintained two accounts, yet, it related to the business of the same assessee in respect of two activities, which are interconnected too. In the circumstances, the assessee decided to go for one registration alone as against two registrations originally taken. This decision was in tune with the management, administration and control of two units under the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nds proposed for denial of Cenvat credit, in the Show Cause Notice dated 04.12.2014, we find that the only reason is that the credits pertain to the period prior to the issue of a common registration on 31.01.2014. The stand taken by the adjudicating authority for denying the Cenvat credit on input services was not taken in the relevant Show Cause Notice and to this extent the Order-in-Original has travelled beyond the scope of Show Cause Notice, which is illegal. In any case the adjudicating authority has not given specific findings as to which are the input services for which credit has been availed and which get hit by the amendment in the definition of Input Services w.e.f. 01.04.2011. Without any such detailed findings, we find that ..... X X X X Extracts X X X X X X X X Extracts X X X X
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