Transfer of unutilised Cenvat credit on factory shift is permissible where the excise rules expressly allow it.

Rule 56AF of the Central Excise Rules permits a manufacturer shifting its factory to another site to transfer unutilised Cenvat credit to the relocated unit. Because the rule expressly authorises such transfer, the Revenue's objection to carrying forward the credit was rejected. The assessee's entitlement to move the unutilised credit to the shifted factory was upheld, and the appeal failed.

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Issues: Whether, on shifting the factory to another site, the manufacturer was entitled to transfer the unutilised Cenvat credit lying in its account to the transferred unit.

Analysis: Rule 56AF of the Central Excise Rules permits a manufacturer who shifts the factory to another site to transfer the unutilised Cenvat credit to the transferred unit. In view of this express statutory permission, the Revenue's objection to such transfer could not be accepted.

Conclusion: The transfer of unutilised Cenvat credit on shifting of the factory was held to be permissible, and the appeal failed.

Final Conclusion: The assessee's entitlement to carry forward the unutilised credit to the shifted factory was upheld, resulting in dismissal of the appeal.

Ratio Decidendi: Where the governing excise rules expressly allow transfer of unutilised Cenvat credit upon shifting of a factory, such transfer cannot be denied.

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