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of <h1>Tribunal upholds use of excise duty credit for education cess payment</h1> <h3>COMMISSIONER OF C. EX., SHILLONG Versus GODREJ CONSUMER PRODUCTS LTD.</h3> The Tribunal upheld the Respondents' practice of utilizing basic excise duty credit for education cess payment, based on the interpretation of relevant ... Cenvat/Modvat - Utilization of credit Issues involved: Interpretation of rules u/s Cenvat Credit Rules, 2004 regarding utilization of basic excise duty credit for payment of education cess.Summary:Issue 1: Utilization of basic excise duty credit for payment of education cessThe Respondents availed area-based exemption under Notification No. 32/99-C.E. and utilized basic excise duty credit for paying education cess on finished goods. The Department objected to this practice. The Ld. Advocate for the Respondents argued that there is no restriction on using basic excise duty credit for education cess payment, citing a Tribunal case. He highlighted that Rule 3(4) of the Cenvat Credit Rules allows credit to be used for any excise duty on final products, including education cess. The Tribunal found that Rule 7(b) restricts education cess credit but not basic duty credit. The Ld. SDR referred to a proviso limiting input duty credit utilization, but it was deemed not applicable to the Respondents. The Tribunal concluded that the Lower Appellate Authority's orders were legal, rejecting the Department's appeals.Decision:The Tribunal upheld the Respondents' practice of utilizing basic excise duty credit for education cess payment, based on the interpretation of relevant legal provisions and precedent case law. The Department's appeals were dismissed, affirming the legality of the Lower Appellate Authority's orders.
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