Tribunal overturns duty demand, recognizes credit eligibility under Finance Act.

The Tribunal allowed the appeal, setting aside the demand for duty amount and interest under Section 11AB. The appellant's eligibility to avail credit as per the Circular and the Finance Act, 2004 was acknowledged, leading to the decision in their favor.

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Issues involved: Appeal against Order-in-Original confirming duty amount and demanding interest u/s 11AB of Central Excise Act, 1944.

Duty amount confirmation: The appellant contended that they had reversed the credit prior to 31-3-2000 and had received goods after 1-4-2000, which they were eligible to take credit for as per the amendment. The Department acknowledged the reversal of credit prior to 31-3-2000. The Tribunal found that the demand of Rs. 2,42,513/- was not as per law and set it aside.

Interest under Section 11AB: The appellant relied on a Board Circular clarifying their eligibility to avail credit of additional duty prior to 1-4-2000, and that they were made eligible only from 1-4-2000 by the Finance Act, 2004. Citing precedents, the appellant argued that there was no basis for demanding interest under Section 11AB. The Tribunal agreed, setting aside the demand for interest as there was no irregular availment of Cenvat credit by the party.

Decision: The Tribunal allowed the appeal, finding that the appellant was eligible to avail credit as per the Circular and the Finance Act, 2004. The demand of duty amount and interest under Section 11AB was set aside based on the findings and legal provisions.

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