Cenvat credit and depreciation on capital goods: no apparent error found where benefits were claimed in separate years.

Rule 4(4) of the Cenvat Credit Rules, 2001 was discussed in the context of capital goods where 50% credit was taken in the year of purchase and the balance in the next financial year. The note explains that depreciation under the Income-tax Act was claimed after reducing the duty element from the value of the capital goods, while the remaining Cenvat credit was adjusted in the year of the second instalment. On these facts, the earlier order treated the arrangement as not involving simultaneous double benefit. The miscellaneous recall application was therefore held not to disclose any mistake apparent from the record and was not maintainable.

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Issues: Whether the miscellaneous application for recall disclosed any mistake apparent in the earlier final order allowing Cenvat credit and depreciation to be taken without contravention of Rule 4(4) of the Cenvat Credit Rules, 2001.

Analysis: The assessee had taken 50% Cenvat credit on capital goods in the year of purchase and the balance 50% in the next financial year. The duty element was reduced from the value of the capital goods while claiming depreciation under the Income-tax Act, and the remaining credit was adjusted in the year in which the balance credit was taken. On these facts, the earlier order had proceeded on the basis that there was no simultaneous availing of double benefit, since the depreciation claim and the credit availment were adjusted in different years in relation to the respective instalments of credit.

Conclusion: No mistake apparent from the record was shown, and the recall application was not maintainable.

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