Cenvat credit can be used to pay Additional Excise Duty absent a specific statutory prohibition.

Additional Excise Duty on textiles and textile articles may be discharged from the Cenvat credit account where the governing duty provisions and credit rules contain no express prohibition. The Tribunal noted only a restriction against using credit meant for basic excise duty for that purpose, and held that this did not prevent payment of the additional duty from the available credit balance. The analysis concluded in favour of the assessee and against the Revenue, with the impugned order set aside and the appeal allowed.

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Issues: Whether Additional Excise Duty (Textiles and Textile Articles) could be paid from the Cenvat credit account.

Analysis: The Tribunal found that the relevant duty and the credit rules did not contain any prohibition against payment of Additional Excise Duty from the Cenvat account. The only restriction noted was against using credit meant for basic excise duty for that purpose, and that restriction did not bar payment of the additional duty from the available credit balance.

Conclusion: The issue was decided in favour of the assessee and against the Revenue.

Final Conclusion: The impugned order was set aside and the appeal succeeded.

Ratio Decidendi: In the absence of a specific statutory prohibition, Additional Excise Duty may be discharged from the Cenvat credit account.

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