Case Law Details
Patodia Filaments Pvt Limited Vs Commissioner of Central Excise & ST (CESTAT Ahmedabad)
CESTAT find that notification No. 30/2004-CE dated 09.07.2004 is not an absolute notification but a conditional notification issued under section 5A. The notification has the condition of non availment of cenvat credit. The sub-rule (3) (i) and (ii) of Rule 11 of the CCR, 2004 are separate. In the present case the sub rule 3 (i) would thus apply as per which the manufacturer is required to pay an amount equivalent to the CENVAT Credit in respect of inputs used in the manufacture of said final product and is lying in stock or in process or is contained in final product lying in stock. In the present case all the conditions enumerated under sub rule 3 (i) has been followed by the Appellant and he is not required to reverse the entire credit lying in balance on the date of opting notification No. 30/2004-CE dated 09.07.2004. Therefore, the balance credit is not liable to be reversed. For the same reason the credit utilised by him for clearance of finished goods or capital goods. We also find that on similar issues in the case of Wearit Global Ltd. 2018 (8) TMI 1094-CESTAT, Janson Textile Processors 2018 (7) TMI 850-CESTAT-Chennai and Sitaram India Ltd. 2018 (10) TMI 11- CESTAT-New Delhi, the credit stands allowed to the manufacturer.
CESTAT allow the appeals filed by both the Appellants with consequential reliefs, if any. Revenue’s appeal being involved the amount less than Rs.20 Lacs is dismissed on the ground of Government’s litigation policy instruction F.No. 390/Misc/1 16/2017-JC dated 11.07.2018.
FULL TEXT OF THE CESTAT AHMEDABAD ORDER
The brief facts of the case are that the appellant is engaged in the manufacture of Polyester Texturised Yarn falling under Chapter 60 of Central Excise Tariff Act, 1985. They were availing Cenvat credit of inputs used in manufacture of final products and capital goods for the period 09.07.2004 to February 2007. They availed benefit of Notification No. 29/2004-CE dated 09.07.2004 and cleared goods on payment of duty. From 01.03.2007, they started availing benefit of Notification No. 30/2004-CE dated 09.07.2004 and reversed Cenvat credit proportionate to goods lying in their stock. There was balance of Rs. 2,86,83,157/- in Cenvat account after such reversal. The appellant thereafter in subsequent periods shifted their manner of clearance from Notification No. 30/2004-CE dated 09.07.2004 to 29/2004-CE dated 09.07.2004 and vice versa till December 2011. The case of the department is that the appellant was issued show cause notice No. V(Ch.54) 3-02/Dem/2012 dated 03.04.2012 for the period December 2007 to March 2011, proposing elapsing credit of Rs. 2,86,83,157/-. Meanwhile the appellant have utilized the Cenvat credit and the present demand is related to such utilization of credit.
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