https://www.taxtmi.com/caselaws?id=120890 Cenvat/Modvat credit on capital goods was inadmissible where the goods, when received and put to use, were used exclusively to manufacture exempted final products; later dutiable clearances or future manufacturing plans did not alter that eligibility test. The recovery of wrongly taken credit was therefore upheld, with only the quantum remitted for fresh determination. On penalty, Section 11AC was not sustainable because the assessee had disclosed the manufacturing arrangement and acted under a bona fide belief, though liability under the rule-based penal provisions was left open for reconsideration in remand. Interest was recoverable on wrongly taken credit even if the credit remained unutilized, as the excise provisions mandated such recovery. en-us Fri, 22 Dec 2006 00:00:00 +0530 Thu, 08 Feb 2024 15:20:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=120890 Cenvat/Modvat credit on capital goods was inadmissible where the goods, when received and put to use, were used exclusively to manufacture exempted final products; later dutiable clearances or future manufacturing plans did not alter that eligibility test. The recovery of wrongly taken credit was therefore upheld, with only the quantum remitted for fresh determination. On penalty, Section 11AC was not sustainable because the assessee had disclosed the manufacturing arrangement and acted under a bona fide belief, though liability under the rule-based penal provisions was left open for reconsideration in remand. Interest was recoverable on wrongly taken credit even if the credit remained unutilized, as the excise provisions mandated such recovery. Case-Laws Central Excise Fri, 22 Dec 2006 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=120890