Transfer of unutilized Cenvat credit on plant takeover upheld; no contravention of credit rules found.

On takeover of the plant, the unutilized Cenvat credit balance was treated as transferable and available to the respondent because the earlier registration had been surrendered, the change in ownership had been accepted, and the Assistant Commissioner had permitted the transfer. The article states that, on those facts, availment of credit at the Kaladera plant was proper, with no procedural irregularity or revenue loss established. It further notes that this did not amount to a contravention of Rule 8 of the Cenvat Credit Rules, 2002, so the Revenue's challenge failed.

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Issues: Whether the respondent was entitled to transfer and avail the unutilized credit balance on takeover of the plant, and whether such availment contravened Rule 8 of the Cenvat Credit Rules, 2002.

Analysis: The record showed that the plant of M/s. Mewar Bottling Co. (P) Ltd., Udaipur was taken over by the respondent, the earlier registration stood surrendered, and the Assistant Commissioner had accepted the change in ownership and permitted transfer of the unutilized credit balance. In these circumstances, the availment of credit by the Kaladera plant was treated as proper and no procedural irregularity or revenue loss was found.

Conclusion: There was no contravention of Rule 8 of the Cenvat Credit Rules, 2002, and the Revenue's challenge failed.

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