NCCD credit utilisation on POY upheld where liability was noted but no specific demand or clear rule breach was shown.

NCCD credit on POY was examined in relation to both availment and utilisation. The availability of credit on the availment side had already been covered by an earlier Tribunal ruling, affirmed by the Bombay High Court. On utilisation, the order-in-original itself proceeded on the basis that NCCD was payable on POY, but no specific demand had been raised for that liability. In that setting, utilisation of NCCD credit for payment of NCCD on POY was treated as unobjectionable, and the Revenue's challenge was also weakened by its failure to clearly identify the rule allegedly breached.

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Issues: Whether the Revenue could sustain its challenge to the assessee's utilisation of NCCD credit on POY, where the order-in-original itself recorded that NCCD was payable on POY but no specific demand had been raised and the appeal did not clearly identify the rule said to have been violated.

Analysis: The availability of credit on the availment side was already covered by the Tribunal's earlier decision, which had also been affirmed by the Bombay High Court. As regards utilisation, the order-in-original itself proceeded on the footing that NCCD was payable on POY, yet no demand had been raised for such liability. In that situation, the use of NCCD credit for payment of NCCD on POY could not be faulted. The appeal also failed to specify with clarity the particular rule allegedly breached in making the utilisation, rendering the challenge vague.

Conclusion: The Revenue's challenge to the utilisation of NCCD credit was not sustainable.

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