Prospective operation of Cenvat credit time limit prevents denial of credit for periods before the amendment.

A six-month time limit for availing Cenvat credit under Rule 4(7) of the Cenvat Credit Rules, 2004 was applied prospectively and could not be used to deny credit for input services received before the amendment. The Tribunal followed the binding High Court view that, absent express retrospective effect, the amendment did not govern the relevant earlier period. On that basis, the assessee was entitled to claim the shortfall in credit, and denial of credit on the ground of the six-month restriction was unsustainable.

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Issues: Whether the restriction of six months for availing Cenvat credit under Rule 4(7) of the Cenvat Credit Rules, 2004 could be applied to deny credit for the period prior to its introduction.

Analysis: The amendment prescribing a six-month time limit for availing credit was introduced prospectively and did not govern the relevant period in which the appellant had received input services. The earlier position, as applied to the facts, permitted availing the shortfall in credit without such time restriction. The Tribunal followed the binding High Court ruling on the prospective operation of the amendment and held it squarely applicable to the present case.

Conclusion: The appellant was entitled to the Cenvat credit claimed, and the denial of credit on the ground of the six-month restriction was unsustainable.

Ratio Decidendi: A time-limit provision for availing Cenvat credit operates prospectively unless expressly made retrospective, and cannot be used to deny credit for a period when no such restriction existed.

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