Tribunal allows appeal, finding Rule 6(3) inapplicable. Appellant's consistent payment crucial. (3)

The Tribunal set aside the impugned order and allowed the appeal, concluding in favor of the appellant. The appellant's consistent payment of Cenvat credit and interest for delays, treating it as if they had not availed the credit, rendered Rule 6(3) of Cenvat Credit Rules, 2004 inapplicable. Reference to a previous order in the appellant's case supported this decision, leading to the favorable outcome pronounced on 04.08.2021.

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Issues Involved:
Whether the appellant is required to pay 10% of the value of exempted goods in terms of Rule 6(3) of Cenvat Credit Rules, 2004.

Analysis:
The appellant, represented by Shri Amal Dave, argued that they have been consistently paying the proportionate Cenvat credit related to exempted goods along with interest for any delays. It was contended that the demand for 10% of the value of exempted goods under Rule 6(3) of Cenvat Credit Rules is not valid. Reference was made to previous decisions by CESTAT in the appellant's own case to support the argument, highlighting that the demand was time-barred due to the extended period involved. Judgments such as M/s. P&B Pharma Limited CESTAT Ahmedabad order, Star Agriwarehousing & Collateral Management vs. CCE & ST, Jaipur, and others were cited to strengthen the case.

The Revenue, represented by Shri Rakesh Bhaskar, reiterated the findings of the impugned order without providing new arguments or evidence to counter the appellant's submissions.

Upon reviewing the arguments and records, the Tribunal noted that there was no dispute regarding the reversal of credit on input services linked to exempted goods. It was observed that the appellant had consistently paid the Cenvat credit and interest for delays, essentially treating it as if they had not availed the credit. Consequently, Rule 6(3) of Cenvat Credit Rules, 2004 was deemed inapplicable in this scenario. The Tribunal referenced a previous order in the appellant's own case from 2010 where a similar issue was decided in favor of the appellant, leading to the setting aside of the impugned order and allowing the appeal.

Based on the precedent set by the previous decision in the appellant's case, dated 26.08.2010, the Tribunal set aside the impugned order and allowed the appeal, concluding the matter in favor of the appellant. The judgment was pronounced in open court on 04.08.2021.

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