Tribunal grants appellant Cenvat credit for 2007-2010, ruling exclusion clause not retrospective The Tribunal allowed the appeal, holding that the disallowed Cenvat credit of Rs. 2,89,414/- was admissible to the appellant for the period from 2007 to ...
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Tribunal grants appellant Cenvat credit for 2007-2010, ruling exclusion clause not retrospective
The Tribunal allowed the appeal, holding that the disallowed Cenvat credit of Rs. 2,89,414/- was admissible to the appellant for the period from 2007 to 2010. The Tribunal determined that the exclusion clause in Rule 2(l) of Cenvat Credit Rules, 2004, which was inserted w.e.f. 01.04.2011, was not retrospective based on a ruling by the Punjab & Haryana High Court. Therefore, the appellant was entitled to the credit as per law, providing consequential relief in favor of the appellant.
Issues involved: Disallowance of Cenvat credit based on exclusion clause in Rule 2(l) of Cenvat Credit Rules, 2004 for 'commercial or industrial construction service' and 'works contract service' during the period from April 2007 to March 2010.
Analysis: 1. The main issue in this case was the disallowance of Cenvat credit amounting to Rs. 2,89,414/- by the original authority, citing the exclusion clause in Rule 2(l) of Cenvat Credit Rules, 2004 for 'commercial or industrial construction service' and 'works contract service' during the period from April 2007 to March 2010.
2. The appellant's counsel argued that the exclusion clause was inserted in the definition of input service under Rule 2(l) of Cenvat Credit Rules, 2004 w.e.f. 01.04.2011, and hence, not applicable to the period in question. The counsel also relied on a ruling by the Punjab & Haryana High Court in a similar case.
3. The Tribunal noted that the exclusion clause in question was indeed inserted w.e.f. 01.04.2011, and the Punjab & Haryana High Court had held that this amendment was not retrospective. Consequently, the Tribunal held that the disallowed credit of Rs. 2,89,414/- was admissible to the appellant, as the amendment was not applicable to the period from 2007 to 2010.
4. Based on the settled legal position and the non-retrospective nature of the amendment, the Tribunal allowed the appeal, stating that the appellants were entitled to consequential relief as per law. The decision was pronounced in the open court, providing relief to the appellant in this matter.
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