Case Law Details
Facts
• Taxpayer is a Central Government Public Sector Undertaking (“PSU”)
• Show cause notice was issued by the adjudicating authority to the tax payer alleging that the taxpayer is not entitled to avail/utilize the MODVAT/CENVAT credit in respect of units whose values stood written off. Hence it was proposed to be reverse such MODVAT/CENVAT credit
• The taxpayer contended that write off was made only with reference to the accounting requirements under AS-2. The inputs, lying in the factory, were useful for production and hence were entitled to MODVAT/CENVAT credit. The adjudicating authority rejected the contention of the taxpayer.
• The taxpayer challenged the order passed by the adjudicating authority by filing an appeal before the Customs, Excise and Service Tax Appellate Tribunal (“CESTAT”) and accordingly applied before the Committee of Disputes (“COD”)
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How unfortunate! Babus were entrusted with a responsibility, and they have failed.