Case Law Details
Ruia Rayon Pvt Ltd. Vs C.C.E & S.T. (CESTAT Ahmedabad)
No credit balance lapse under rule 11(3) as it applies only on absolute exemption notification and not on conditional one
Conclusion: While in terms of strict provision of Rule 11(3) of Cenvat Credit Rules, 2004, the bar of lapsing of credit was applicable only when the assessee availed the absolute exemption and not on the conditional one.
Held: The issue involved in the present case was that whether the appellant was entitled to carry forward the Cenvat credit after the date of availment of exemption Notification No. 30/2004-CE dated 09.07.2004, in terms of Rule 11(3) of the Cenvet Credit Rules, 2004 and whether the said credit could be utilised for payment of duty. The case of the Department was that as per Rule 11(3) of Cenvat Credit Rules, 2004, if the appellant availed the exemption the Cenvat credit on the stock as on the date of opting for the said exemption Notification No. 30/2004-CE dated 09.07.2004, should stand lapse and consequently, the same could not be utilised for payment of duty. It was held that the Notification No. 30/2004-CE dated 09.07.2004, was admittedly a conditional one. In terms of strict provision of Rule 11(3) of Cenvat Credit Rules, 2004, the bar of lapsing of credit was applicable only when the assessee availed the absolute exemption Therefore, in the present case exemption Notification No. 30/2004-CE dated 09.07.2004, being a conditional one, bar of lapsing of credit should not apply. In light of various precedents, the Tribunal set aside the impugned order and allowed the appeal.
FULL TEXT OF THE CESTAT AHMEDABAD ORDER
Please become a Premium member. If you are already a Premium member, login here to access the full content.
Author Bio
