Appeal Delay Condoned, Payment Demand Confirmed, Compliance Order Issued: CENVAT Credit Rules

The delay in filing the appeal was condoned by the Tribunal based on directions from the High Court, allowing the appeal to proceed. The demand for payment of 10% of the value of finished goods under Rule 6(3)(b) of CENVAT Credit Rules, 2004 was confirmed by the Commissioner, leading to a recovery order and penalty. The Tribunal noted the amendment to Rule 6(3)(b) post-April 2008, which provided payment options based on a formula. The applicant's compliance with the reversal of CENVAT credit was found inadequate, leading to a direction for further deposit pending compliance and appeal disposal.

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Issues:
1. Condonation of delay in filing the appeal.
2. Demand of 10% of the value of total price of finished goods under Rule 6(3)(b) of CENVAT Credit Rules, 2004.
3. Interpretation of Rule 6(3)(b) before and after the amendment.
4. Compliance with the reversal of CENVAT credit and payment requirements.

Condonation of Delay:
The applicant filed for condonation of an 85-day delay in filing the appeal due to a writ petition before the High Court. The High Court's order extended the stay to enable the appeal remedy before the Tribunal. The delay was condoned based on the High Court's directions, allowing the appeal to proceed.

Demand of 10% of Finished Goods Value:
The applicant, engaged in manufacturing, availed CENVAT credit on imported materials for finished goods. The Revenue alleged non-compliance with Rule 6(3)(b) regarding payment of 10% of the value of finished goods cleared without duty under an exemption notification. The Commissioner confirmed the demand, leading to a recovery order and penalty.

Interpretation of Rule 6(3)(b):
The Tribunal noted the amendment to Rule 6(3)(b) post-April 2008, allowing options for payment based on a formula. The retrospective amendment by the Finance Act, 2010 provided an option for payment with evidence within a specified period. The Commissioner observed non-exercise of this option by the applicant, leading to non-compliance post-April 2010.

Compliance with Reversal of CENVAT Credit:
The applicant claimed to have reversed the proportionate CENVAT credit used for exempted goods, supported by a Chartered Accountant's Certificate. However, the Revenue representative argued lack of evidence for credit reversal as per the amended formula. The Tribunal found the applicant's submission inadequate, directing a further deposit of a specified amount pending compliance and disposal of the appeal.

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