Cenvat credit on capital goods sent to a job worker remained admissible after reversal and single re-availment.

Duty paid on capital goods sent to a job worker was treated as eligible Cenvat credit in the recipient's hands, subject to the 180-day condition in Rule 4(5)(a) of the Cenvat Credit Rules, 2002. When the goods were not received back within that period, the manufacturer reversed the credit and issued revised invoices, and the credit was availed only once. On that basis, the essential conditions for credit were satisfied and the credit remained admissible.

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Issues: Whether Cenvat credit was admissible when capital goods were sent to a job worker without payment of duty, duty was later paid, the goods were not returned within the stipulated period, and the credit was reversed and re-availed only once.

Analysis: The duty paid on the capital goods constituted eligible credit in the hands of the recipient. The entitlement under Rule 4(5)(a) of the Cenvat Credit Rules, 2002 was subject to the time limit of 180 days. Since the goods were not received back within that period, the manufacturer reversed the credit and raised revised invoices, and there was no double availment of credit. The essential conditions for credit were therefore satisfied.

Conclusion: The assessee was entitled to Cenvat credit and the order of the Tribunal was in law; the Revenue's challenge failed.

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