Cenvat credit on duty-paid chassis required fresh adjudication after the exemption claim for the final product was withdrawn.

Duty-paid chassis used in manufacture of motor vehicles raised the issue of whether the assessee was entitled to Cenvat credit on that input after abandoning the exemption claim for the final product. The claim for chassis credit had been made before the adjudicating authority but was not examined, while credit on other duty-paid inputs had already been taken and payment under Rule 6 of the CENVAT Credit Rules, 2002 had been appropriated towards the demand. The matter was remanded to the Commissioner for fresh adjudication on the chassis credit claim, and the impugned order was set aside.

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Issues: Whether the assessee's claim for Cenvat credit on duty-paid chassis required fresh consideration, warranting remand after the assessee gave up the exemption claim under the notification.

Analysis: The motor vehicles were manufactured using duty-paid chassis and other duty-paid inputs. The assessee had not taken credit on the chassis, but had taken credit on other inputs and had also made payment under Rule 6 of the CENVAT Credit Rules, 2002, which had been appropriated towards the duty demand. The claim for credit on chassis had been raised before the adjudicating authority but was not examined. Since the exemption claim for the final product was given up, the core question became whether the assessee was entitled to input duty credit on chassis, which required a fresh decision on the facts and submissions already on record.

Conclusion: The matter was remanded to the Commissioner for fresh adjudication after considering the assessee's claim for input duty credit on chassis, and the impugned order was set aside.

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