TMI Blog2021 (8) TMI 935X X X X Extracts X X X X X X X X Extracts X X X X ..... tal asset/input. Admittedly, Revenue has not been able to identify the details of inventory or any asset, for which the general provision has been made. The show cause notice is erroneous as the amount of ₹ 57,52,999/- is for stores and spares provision appearing in the Trial balance as on 31.03.2017 ( a Credit Balance) whereas the amount of ₹ 20,04,324/-is debit balance of stores and spares expenses . The two being different account heads, have been wrongly taken together, making the show cause notice vague and misconceived. Appeal allowed - decided in favor of appellant. - Excise Appeal No.50816 of 2020 (SM) - FINAL ORDER NO. 51733 /2021 - Dated:- 15-7-2021 - SHRI ANIL CHOUDHARY, MEMBER (JUDICIAL) Shri Hemant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to June, 2017 ( relevant period ) along with interest and penalty, on the ground that the appellant had not paid or reversed the Cenvat Credit of ₹ 9,69,666/- in respect of the capital goods/inputs for which provision for alleged write-off was made during the period of dispute, as was required under Rule 3(5B) of Cenvat Credit Rules. In the show cause notice, the aforesaid demanded amount has been computed by assuming the provision for non-moving inventory appearing in trial balance, as write off value. 5. Prior to the issue of show cause notice, Superintendent requested the appellant to submit the details of provisions made for non-moving inventory of store items (capital goods/inputs) in the books of accounts for the financial ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... de for non-moving inventory do not reduce the value of inventory in the price store ledger . Further, such provision does not reduce the value of inventory, as appearing in the trial balance (final accounts). Even after making the provisions for non-moving inventory, whenever such item or inventory is issued for use in plant, its full value is charged to stores and spares expenses . It is further observed in para 6 of the show cause notice since no itemwise details of the cenvat credit taken on the store items was provided by the assessee, therefore, the value of the provisions made for non-moving inventory has been taken from the trial balance furnished by the assessee and the rate of duty was adopted as applicable during the relevant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... w cause notice was adjudicated by the Superintendent, who was pleased to confirm the demand along with interest and penalty of ₹ 96,967/- under Rule 15(1) of CCR read with Section 11 AC of the Act. 8. Being aggrieved, the appellant preferred appeal before the Commissioner (Appeals) on the aforementioned grounds taken in reply to the show cause notice, they also placed reliance on the ruling in the case of Molex (India) Pvt. Ltd. Vs. CCE (Tribunal-Bangalore) 2013 (297) ELT 266 (T-Bangalore). It was urged that computation of cenvat credit to be reversed is incorrect and arbitrary. The Commissioner (Appeals) was pleased to dismiss the appeal observing that whenever the capital goods/inventory have been written off, or even if the pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s . Thus, there is patent error, which is evident on the face of the record, and thus, the show cause notice is wholly mis-conceived and fit to be quashed. It is further urged that the Revenue have failed to notice that there is no change in the value of the inventory/capital goods in the books of accounts, and thus, it cannot be assumed that any value of the inventory/capital goods has been written off either fully or partially. Admittedly, there is no adjustment in the accounts for inventory/capital goods or in the provision made in the books of accounts. Thus, in the facts and circumstances, Rule 3(5B) of CCR is not attracted. 11. Further, reliance has been placed on the ruling of the Hon ble Supreme Court in the case of Reliance Ener ..... X X X X Extracts X X X X X X X X Extracts X X X X
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