2016 (3) TMI 1162 - AT - Central Excise

Tribunal: Cenvat credit valid pre-2007; Rule 11(7) denial upheld; Commissioner's extension invalid.

The Tribunal clarified that the appellant correctly availed Cenvat credit pre-2007, as Rule 9(2) amendments did not apply retrospectively. The denial of ... Cenvat credit - Rule 9(2) of the CCR, 2004 - Held that: - the impugned period in this case is prior to 1-3-2007 therefore, provision of Rule 9(2) of the Cenvat Credit Rules, 2004 dated 1-3-2007 are not applicable to the facts of the case, as the said provisions are applicable prospectively and not retrospectively. In that circumstances, I hold that provisions of Rule 9(2) of the Cenvat Credit Rules, 2004 dated 1-3-2007 are not applicable to the facts of this case. As the adjudicating authority has not denied Cenvat credit to the appellants for contravening to the provision of Rule 11(7) of CER, 2002, in that circumstances, the order of adjudicating authority is final therefore, the ld. Commissioner (A) has gone beyond the scope of the issue in appeal preferred before him - Appeal allowed. Issues:Appeal against denial of Cenvat credit for contravention of Rule 9(2) of the Cenvat Credit Rules, 2004.Analysis:The appellant availed Cenvat credit during April 2004 to December 2005 based on invoices from a registered dealer without specifying the manufacturer's details. A show cause notice was issued, and the appellant contested the denial of credit for invoices post-March 2005. The adjudicating authority held the appellant contravened Rule 9(2) of the Cenvat Credit Rules, 2004. The Commissioner (A) extended the issue to Rule 11(7) of the Central Excise Rules, 2002, denying credit. The appellant challenged this extension.The appellant argued that Rule 9(2) as amended in 2007 did not apply retrospectively to their case, thus their credit availed was correct. They contended that the Commissioner (A) overstepped by considering Rule 11(7) which was not the original issue. The Revenue did not contest the adjudicating authority's finding on Rule 9(2).The Tribunal found that Rule 9(2) amended in 2007 did not apply to the appellant's case pre-2007. As the Revenue did not challenge the denial based on Rule 11(7) of CER, 2002, the adjudicating authority's decision stood. The Commissioner (A) exceeded the scope by considering Rule 11(7). Consequently, the impugned order was set aside, and the appeal allowed.In conclusion, the Tribunal clarified the non-retrospective application of Rule 9(2) amendments, upheld the denial based on Rule 11(7) findings, and deemed the Commissioner (A)'s extension beyond the original issue as invalid, resulting in the appeal being allowed.