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High Court upholds challenge to circular reversing CENVAT credit on Bagasse, nullifies related show cause notice The High Court allowed the writ petition challenging a circular reversing CENVAT credit related to Bagasse, in line with a previous judgment setting aside ...
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High Court upholds challenge to circular reversing CENVAT credit on Bagasse, nullifies related show cause notice
The High Court allowed the writ petition challenging a circular reversing CENVAT credit related to Bagasse, in line with a previous judgment setting aside a similar circular. The Revenue was given the opportunity to file a review application if the judgment's finality was in question. The court clarified that setting aside the circular also nullified any related show cause notice. The decision aligned with the previous ruling of the Allahabad High Court, effectively upholding the challenge to the circular and disposing of any pending applications in the case.
Issues: Challenge to circular reversing CENVAT credit related to Bagasse
Analysis: The petitioner challenged circular No.1027/15/2016-CX issued by the Central Board of Excise and Customs, seeking to reverse the CENVAT credit related to Bagasse by treating it as a non-excisable good for the purpose of credit reversal under Rule 6 of the CENVAT Credit Rules, 2004.
The petitioner's counsel pointed out that a similar circular was challenged in the Allahabad High Court, and in a judgment dated 12.04.2019 in the case of Balrampur Chini Mills Ltd. Vs. Union of India, the circular was set aside. The counsel for the respondents acknowledged this fact but expressed uncertainty about the finality of the judgment.
Considering the factual assertion and the previous judgment setting aside the circular, the High Court allowed the writ petition in line with the earlier judgment. The Revenue was granted liberty to file a review application if the claim about the finality of the judgment was incorrect. It was clarified that setting aside the circular also automatically nullified any show cause notice based on the impugned circular.
With the petition allowed, any pending civil miscellaneous application related to the case was also disposed of. The judgment effectively upheld the challenge to the circular reversing CENVAT credit concerning Bagasse, aligning with the previous decision of the Allahabad High Court.
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