TMI Blog2023 (11) TMI 149X X X X Extracts X X X X X X X X Extracts X X X X ..... t, input in process and input contained in the final product, whatever balance credit is left out the same shall lapse in terms of Rule 11(3) of Cenvat Credit Rules, 2004. From the plain reading of the Rule 11(3) of Cenvat Credit Rules, 2004, it can be seen that as per 11(3)(i) if an assessee opt for exemption from whole of the duty under a notification issued under Section 5A, the assessee is required to pay an amount equalent to Cenvat Credit in respect of input lying in stock, input in process and input contained in the final product lying in stock. As per this rule irrespective of whether the notification is absolute or otherwise the assessee is required to reverse the credit in respect of input, input in process or input contained i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ification No. 30/2004-CE dated 09.07.2004 after reversal of Cenvat Credit on input, input in process and input contained in final product, whether the balance Cenvat Credit shall lapse in terms of Rule 11(3) of Cenvat Credit Rules, 2004 or otherwise. 2. Shri Sachin Chitnis, Learned Counsel along with Shri Kiran Chavan appearing on behalf of the appellant submits that as per the strict interpretation of Rule 11(3) of Cenvat Credit Rules, 2004 after reversal of credit as required under Rule 11(3)(i) the balance credit shall lapse only in a case where the asssesse avails an exemption which is absolutely in nature under Section 5A. In the present case the Notification No. 30/2004-CE is not absolute exemption but bearing a condition. Therefor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , whatever balance credit is left out the same shall lapse in terms of Rule 11(3) of Cenvat Credit Rules, 2004. For ease of reference the said of rule is reproduced below: RULE 11. Transitional provision. (1) Any amount of credit earned by a manufacturer under the CENVAT Credit Rules, 2002, as they existed prior to the 10th day of September, 2004 or by a provider of output service under the Service Tax Credit Rules, 2002, as they existed prior to the 10th day of September, 2004, and remaining unutilized on that day shall be allowed as CENVAT credit to such manufacturer or provider of output service under these rules, and be allowed to be utilized in accordance with these rules. (2) A manufacturer who opts for exemption from the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se and shall not be allowed to be utilized for payment of duty on any other final product whether cleared for home consumption or for export, or for payment of service tax on any output service, whether provided in India or exported. (4) A provider of output service shall be required to pay an amount equivalent to the CENVAT credit, if any, taken by him in respect of inputs received for providing the said service and is lying in stock or is contained in the taxable service pending to be provided, when he opts for exemption from payment of whole of the service tax leviable on such taxable service under a notification issued under section 93 of the Finance Act, 1994 (32 of 1994) and after deducting the said amount from the balance of CEN ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ll apply only in case where the exemption notification is absolute. 4.1 In the present case the notification No. 30/2004-CE contains a condition namely provided that nothing contain in this notification shall apply to the goods in respect of which credit of duty on input has been taken under the provision of Cenvat Credit Rule, 2002 . Since the notification contained the said condition the notification No. 30/2004-CE is not an absolute exemption. Consequently, the provision of lapsing of the remaining credit in terms of Rule 11(3) (ii) shall not apply in the fact of the present case. This issue has been considered time and again in various judgments as cited by the appellant. Therefore, the issue is no longer res-integra. 5. Accordin ..... X X X X Extracts X X X X X X X X Extracts X X X X
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