TMI Blog2019 (8) TMI 422X X X X Extracts X X X X X X X X Extracts X X X X ..... t Rules, 2004 is invalid and unconstitutional. The demand raised invoking proviso to sub-rule (4) of Rule 3 of CENVAT Credit Rules, 2004 cannot sustain - appeal allowed - decided in favor of appellant. - E/41248/2019-SM - Final Order No. 41014/2019 - Dated:- 7-8-2019 - MS SULEKHA BEEVI C.S, MEMBER (JUDICIAL) Ms. D. Naveena, Advocate For the Appellant Shri B. Balamurugan, AC (AR) For the Respondent ORDER Per: Ms Sulekha Beevi C.S Brief facts are that the appellants are engaged in manufacture of newsprint reels, maplitho paper reels etc. and are registered with the Department. It was observed by the department that the appellants contravened the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ellant could have utilized the credit for payment of the defaulted excise duty had they taken the credit earlier than February 2016. 2.1 It is also argued by the ld. counsel that proviso to sub-rule (4) of Rule 3 of CENVAT Credit Rules, 2004 has been struck down as invalid and unconstitutional by the Hon'ble High Court of Gujarat in the case of Advance Surfactants India Ltd. Vs. UOI 2017 (358) ELT 53 (Guj.). That therefore the demand raised invoking proviso to sub-rule (4) of Rule 3 cannot sustain. 3. The ld. AR Shri B. Balamurugan supported the findings in the impugned order. He much emphasized on the proviso to sub-rule (4) of Rule 3 of CENVAT Credit Rules, 2004 and argued that the appellant could not h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the said proviso to sub-rule (4) of Rule 3 of CENVAT Credit Rules, 2004 is invalid and unconstitutional. The relevant paragraph of the said judgment is reproduced as under:- 5.2 Even otherwise, proviso to sub-rule (4) of Rule 3 of the Cenvat Credit Rules can be said to be ultra vires to Rule 3(1) of the Cenvat Credit Rules as it does not have any nexus with the object sought to be achieved by the Rules and in fact runs contrary to the principles of Cenvat Credit Rules. At this stage, it is required to be noted that as per catena of decisions of the Hon ble Supreme Court as well as this Court and other High Courts, Cenvat Credit is indefeasible and there is no correlation of the raw-material and the final product. It is not ..... X X X X Extracts X X X X X X X X Extracts X X X X
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