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TMI Blog2023 (8) TMI 244X X X X Extracts X X X X X X X X Extracts X X X X ..... tion Notification No. 30/2004-CE dated 09-07-2004 (Sr. No. 9). The appellant though availed the Cenvat Credit on the common inputs however at the time of clearance of the goods they have reversed 5% of the value of the goods in terms of Rule 6(3)(i) of Cenvat Credit Rules 2004. The case of the department is that since the appellant had availed Cenvat Credit even though they reversed 5% they have violated the condition of Notification No. 30/04-CE which prescribes for availing the said exemption no Cenvat Credit should be availed on inputs. Accordingly, by denying the exemption Notification No. 30/04-CE, the demand was confirmed for the period prior to the 01.04.2011. 2. Shri Abhay Desai, Learned Counsel, appearing on behalf of the appellan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 0/14-CE they reversed 5% in terms of Rule 6 (3)(i) of Cenvat Credit Rules, 2004. It is observed that in Rule 6, sub-Rule (3D) was included under explanation with effect from 01.04.2011 which reads as under: "(3D) Payment of an amount under sub-rule (3) shall be deemed to be CENVAT credit not taken for the purpose of an exemption notification wherein any exemption is granted on the condition that no CENVAT credit of inputs and input services shall be taken. 4.1 Payment of an amount of 5% in terms of sub-rule (3D) shall be deemed to be Cenvat Credit not taken for the purpose of an exemption Notification where in any exemption is granted on the condition that no Cenvat Credit of inputs and input services shall be taken. In terms of the abov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s, input services and capital goods in terms of Cenvat Credit Rules, 2004. They are clearing a part of the finished goods without payment of duty in terms of Notification No. 30/2004-C.E., dated 9-7-2004. In respect of this exempted goods, the appellants are paying an amount equal to 6% of the value in terms of Rule 6(3)(i) of the said Rules. Notification No. 30/2004-C.E., dated 9-7-2004 stipulates that nothing contained in the said notification shall apply to the goods in respect of which credit of duty on inputs has been taken under the provisions of Cenvat Credit Rules, 2004. The Revenue is of the view that as the appellant have availed credit on all inputs (used for duty paid as well as exempted final products) they are barred from avai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... im on the applicability of sub-rule (3D) of Rule 6 is legally sustainable. The said sub-rule provides for a deeming provision to the effect that payment of amount under sub-rule (3) should be considered as credit not taken for the purpose of such exemption notification. The appellant's case is covered by the said provision as pointed out by the ld. Counsel for the appellant even before the introduction of the said sub-rule in 2011. The Tribunal held that payment of amount under sub-rule (3)(i) of Rule 6 will make the assessee eligible for claiming such exemption as the present one. We find the case laws relied on by the ld. Counsel for the appellants clearly support their contention. The decisions of the Tribunal in Life Long Appliances Ltd ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8% of value of exempted goods, in terms of provisions of Rule 6(3)(d). 3. The Revenue entertained a view that as the appellant had availed credit on common inputs which have been used in the manufacture of duty paid clearances as also exempted clearances and payment of 8% in terms of Rule 6(3)(d) is not sufficient, the conditions of Notification are violated. As such, the appellants are not entitled to the benefit of exemption notification. Accordingly the proceedings were initiated against them. The appellants during the course of adjudication, calculated the total credit availed by them in respect of inputs used in the manufacture of exempted final products. After taking into account the payment already made in terms of Rule 6, they de ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... - 2008 (229) E.L.T. 484 (S.C.) (9) Refnol Resins & Chemicals Ltd. v. Union of India - 2013 (287) E.L.T. 61 (Guj.). 5. The ratio of law declared by the above decisions to the effect that the credit initially taken if reversed subsequently is required to be considered as if no credit was ever taken and amounts to satisfying the condition of notification which are to the effect that no credit should be availed on inputs. We also note that Hon'ble Gujarat High Court's decision in the case CCE v. Ashima Dyecot Ltd. - 2008 (232) E.L.T. 580 (Guj.) = 2008 (12) S.T.R. 701 (Guj.) where the provisions of explanation to Rule 3, which also stands relied upon by the lower authorities in the present case, were taken note of it was held that reversal ..... X X X X Extracts X X X X X X X X Extracts X X X X
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