Reversal of Cenvat credit on inputs removed as such follows the duty-paid invoice value under binding precedent and circular guidance.

Removal of inputs as such to a sister unit requires reversal of the Cenvat credit originally availed on the duty-paid invoice value, as recognised by prior Tribunal precedent and the Board circular on valuation of such clearances. The Tribunal followed the Larger Bench view that this credited amount is the proper duty liability when inputs are transferred without processing. On that basis, it found no ground to disturb the Commissioner (Appeals)' order and rejected the Revenue's appeal.

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Issues: Whether, on removal of inputs as such to a sister unit, the amount equivalent to the Cenvat credit availed could be treated as the correct duty liability and whether the Revenue had any ground to interfere with the order setting aside the adjudication order.

Analysis: The disputed period involved removal of inputs as such without processing, and the Tribunal noted that the issue had already been decided in favour of the assessee in earlier Tribunal precedent. Reliance was placed on the Board circular prescribing the valuation approach for inputs removed as such, and on the Larger Bench view that the credit availed on the duty paid invoice value represents the correct amount to be reversed when such inputs are transferred without processing.

Conclusion: The removal of inputs as such required reversal of Cenvat credit in the manner recognised by the earlier Tribunal decisions, and no ground was found to interfere with the Commissioner (Appeals)' order. The Revenue's appeal was rejected.

Final Conclusion: The assessee succeeded and the order in its favour was sustained, leaving the Revenue without relief.

Ratio Decidendi: When inputs are removed as such without processing, the Cenvat credit originally availed on the duty paid invoice value is the proper amount to be reversed, in accordance with the binding valuation guidance and Tribunal precedent.

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