Waiver granted for in-eligible CENVAT Credit on capital goods

The Tribunal granted the appellant's application for waiver of pre-deposit of duty, interest, and penalty on in-eligible CENVAT Credit availed for M.S. plates and angles used as capital goods. The appellant successfully demonstrated a prima facie case for the waiver, supported by a Chartered Engineer's certificate and Tribunal decisions allowing similar credits during the relevant period. The recovery of the amounts was stayed pending appeal disposal.

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Issues:
- Waiver of pre-deposit of duty, interest, and penalty on in-eligible CENVAT Credit availed by the appellant for M.S. plates and angles used as capital goods.

Analysis:
The appellant filed a Stay Petition seeking waiver of pre-deposit of duty amounting to Rs.1,22,24,493/-, along with interest and penalty, which had been confirmed by the adjudicating authority as in-eligible CENVAT Credit availed by the appellant during the period of July 2009 to August 2009 on M.S. plates and angles, considered as capital goods. The appellant's Counsel argued that the M.S. plates and angles were used for fabrication of tanks, chemical vessels, and equipment within the factory premises, supported by a Chartered Engineer's certificate. The Counsel contended that the show cause notice issued in 2012 was time-barred as the credit was availed in 2009, and during that period, Tribunal decisions allowed such credit on similar inputs.

The Departmental Representative opposed the appellant's claim, stating that the appellant failed to justify the CENVAT Credit claim and lacked records proving the utilization of M.S. plates for fabrication purposes. The absence of evidence supporting the appellant's claim was highlighted, suggesting that some amount should be deposited by the appellant. However, it was noted that the appellant had presented a Chartered Engineer's certificate, which remained unchallenged by the Revenue with no contradictory evidence provided. Additionally, it was acknowledged that during the relevant period, Tribunal decisions supported the availment of CENVAT Credit on duty-paid M.S. plates and angles, even if used for structural purposes. Reference was made to a specific case where credit on goods used for storage tanks and pollution control equipment was allowed, and the decision was upheld by the High Court.

Ultimately, the Tribunal found that the appellant had established a prima facie case for the waiver of pre-deposit of the amounts in question. Consequently, the application for the waiver of pre-deposit was granted, and the recovery of the amounts was stayed pending the disposal of the appeal.

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