Reckitt Benckiser India Ltd. Vs Commissioner of Central Excise & Service Tax (CESTAT Chandigarh)
CESTAT Chandigarh allowed Reckitt Benckiser India Ltd.’s appeal against a demand of Rs.79,49,359 for CENVAT credit availed on inputs procured from units claiming exemption under Notification No.01/2010-CE dated 06.02.2010. The Revenue contended that such credit was inadmissible before Rule 12 of the CENVAT Credit Rules, 2004 was amended by Notification No.02/2014-CE (NT) with effect from 20.01.2014. A show cause notice dated 16.10.2017 was issued under Rule 14 of the CCR, 2004, followed by confirmation of the demand and penalty.
The appellant submitted that credit was governed by Rules 3 and 4 of the CCR, 2004 and that Rule 12 did not restrict credit where the inputs were duty-paid and other conditions were satisfied. It also contended that the 2014 amendment was clarificatory and that the extended limitation period could not be invoked, particularly as departmental audits had examined its records and the dispute involved statutory interpretation.
The Tribunal examined the CENVAT credit scheme and noted that Rule 3 permits credit where the relevant inputs or input services have suffered duty, are used in manufacture or provision of output services, and are received under prescribed documents. The Department did not dispute fulfilment of these conditions.
