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CESTAT Chennai: PVC manufacturer must deposit sum for alleged CENVAT credit misuse The Appellate Tribunal CESTAT CHENNAI directed the applicant, engaged in PVC resin manufacturing, to deposit a specified sum within a set period for ...
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CESTAT Chennai: PVC manufacturer must deposit sum for alleged CENVAT credit misuse
The Appellate Tribunal CESTAT CHENNAI directed the applicant, engaged in PVC resin manufacturing, to deposit a specified sum within a set period for allegedly availing CENVAT credit on capital goods installed outside the factory premises. The Tribunal noted the possession of the Marine Terminal Facility by the applicant based on registration with the Tamil Nadu Maritime Board. It waived the balance amount's predeposit, stayed recovery, and scheduled a hearing, tagging the appeal with a related case.
Issues: Alleged wrongful availment of CENVAT credit on capital goods installed outside factory premises.
Analysis: The judgment by the Appellate Tribunal CESTAT CHENNAI pertains to the case of an applicant engaged in the manufacture of Poly Vinyl Chloride resin, who allegedly availed credit on capital goods installed outside the factory premises. The Commissioner confirmed the demand of CENVAT credit along with interest and penalty. The learned counsel for the applicant argued that they received raw material through pipelines from the shore and took credit on capital goods installed in the jetty and pipelines. It was mentioned that in a similar issue involving the same applicant, the Tribunal had partly granted a stay.
The learned Additional Commissioner (AR) contended that the Marine Terminal Facility (MTF) was not exclusively in the possession of the applicant, citing a relevant legal precedent. The AR argued that the predeposit amount should be increased in this case. After hearing both sides and examining the records, the Tribunal noted the counsel's argument that the MTF was occupied based on registration with the Tamil Nadu Maritime Board. It was also highlighted that the registration of the jetty under Central Excise Law was sub-judice before the Tribunal. The Tribunal acknowledged previous cases where credit was denied on capital goods used outside the factory premises.
Consequently, the Tribunal directed the applicant to deposit a specified sum within a set period, with the balance amount's predeposit being waived and recovery stayed until the appeal's disposal. The hearing was scheduled for a specific date, subject to compliance with the stay order. Additionally, the appeal was to be tagged with another related appeal for procedural purposes. The judgment was dictated and pronounced in open court by one of the judges.
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