Tribunal enforces retroactive amendment to CENVAT Credit Rules with compliance conditions.

The Tribunal upheld the retrospective effect of the amendment to Rule 2(k) of the CENVAT Credit Rules, 2004, in the second appeal. The appellant was directed to reverse the disputed CENVAT credit within six weeks. Compliance would lead to a waiver of pre-deposit and stay of recovery for penalty and interest on duty. The Deputy Registrar was tasked with monitoring compliance and reporting to the Bench.

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Issues:
1. Reversal of CENVAT credit in the first appeal
2. Retrospective effect of amendment to Rule 2(k) of CENVAT Credit Rules, 2004
3. Tribunal's Larger Bench decision in Vandana Global Ltd. Vs. CCE, Raipur
4. Waiver of pre-deposit and stay of recovery in penalty imposition
5. Direction to reverse CENVAT credit in the second appeal

Analysis:
1. The appellant reversed the CENVAT credit in question in the first appeal, which was not disputed. However, in the second appeal, no such reversal was made. The argument presented was that the amendment to Rule 2(k) of the CENVAT Credit Rules, 2004, which excluded certain structural materials from the definition of 'input,' could not have retrospective effect as the dispute period was before the amendment date of 7.7.2009. The structural materials were used in the construction of a shed for storing raw material. The Deputy Commissioner (AR) referred to the Tribunal's Larger Bench decision in Vandana Global Ltd. Vs. CCE, Raipur, which held the amendment to be retrospective.

2. The Tribunal considered the submissions and found merit in the Deputy Commissioner's argument regarding the retrospective nature of the amendment. Consequently, in the first appeal, there was a waiver of pre-deposit and stay of recovery for the penalty imposed on the appellant. In the second appeal, a direction was given to the appellant to reverse the CENVAT credit in question within six weeks. Upon compliance, there would be a waiver of pre-deposit and stay of recovery for penalty and interest on duty. The appellant was instructed to report compliance to the Deputy Registrar by a specified date, with the Deputy Registrar then reporting to the Bench accordingly.

This detailed analysis covers the issues raised in the judgment, including the reversal of CENVAT credit, retrospective effect of the amendment, reference to the Tribunal's Larger Bench decision, and the consequential directions regarding penalty imposition and CENVAT credit reversal.

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