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TMI Blog2017 (3) TMI 1623X X X X Extracts X X X X X X X X Extracts X X X X ..... hines and accessories falling under Chapter Heading 8477 of the Central Excise Tariff Act, 1985. The appellant imported two extruder machines in January, 2009 from M/s. Steer (China) Corporation, China and availed Cenvat credit of duty paid on these machines amounting to Rs. 9,06,584/-. The said machines were used only for demonstration purpose so as to explain their features to the prospective customers of the appellant, as the appellant is also manufacturing the same machine. Internal audit party of the department conducted audit during January, 2010 wherein they observed that since the said imported machines were not used "in or in relation to manufacture" as stipulated in Rule 2(a) of the Cenvat Credit Rules 2004, the same cannot be ter ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rd Circular No. 267/11/2010-CX, dated 8-7-2010. He further submitted that the entire Cenvat credit was reversed much before the issue of show cause notice as per Section 11A(2B) of the Central Excise Act, 1944, no show cause notice be issued. He further submitted that the appellant had sufficient balance of the Cenvat credit in their Cenvat account during the month of availment of credit i.e. February, 2009 till the month of its reversal i.e. January, 2010. He further submitted that the demand of interest by the department is unsustainable as the Cenvat credit availed was not utilised and reversed immediately upon being pointed out by the audit party of the department. For this he relied upon the following decisions : (1) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... careful reading of the definition of "capital goods" what emanates is that such goods are to be used in the factory of manufacturer of final products and nowhere it is stipulated that the said goods are to be used "in or in relation to the manufacture of final products". Further I also find that both the authorities below are reading a non-existent condition into the definition of capital goods which is impermissible. Further I also find that the irregular Cenvat credit availed was not utilised and as per the decisions of the Hon'ble Karnataka High Court in the case of Bill Forge Pvt. Ltd. (supra) appellants are not liable to pay interest as the appellants have not utilised the credit. Further I also find that the entire demand is barred b ..... X X X X Extracts X X X X X X X X Extracts X X X X
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