2009 (8) TMI 591

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....itional Commissioner and affirmed by the Commissioner (Appeals) vide the impugned order. After hearing both sides on the stay application, we find that the appeal can be disposed off without a further hearing. We take up the appeal. The facts of the case are obvious from the findings of the original authority. The relevant extracts of his order are reproduced below:- "The issue to be decided in the instant case is as to whether the assessee is eligible to avail Cenvat credit on Capital goods procured by the assessee during the year 2006-07. The assessee is a SSI unit and had availed of the full exemption during the year 2006-07 and had not registered themselves with the Department during the financial year and had only got registration o....

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....ng exemption limit and payment of excise duty on its products at factory gate and that credit can be accumulated till completion of clearance of Rs. 100 lakhs. They have also relied on the clarification given by the Board under frequently asked question 2007 (207) E.L.T. 775 wherein it has been clarified that SSI Units can take credit of duty paid on Capital Goods which can be used after crossing Rs. 100 lakhs full exemption limit. In both the above cases, I find that it has been held that an assessee can avail and accumulate credit on Capital Goods even when the assessee is manufacturing and clearing excisable goods at Nil rate of duty by availing the SSI exemption and can utilize the same after crossing the exemption limit of Rs. 100 C....

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.... 4. We have studied the case records and the submissions by both sides. We find that Rule 3(1) of Cenvat Credit Rules, 2004 (CCR) governs availment of credit of various types of duties. As per this rule, there is no bar in an SSI unit taking Cenvat credit on inputs or capital goods received during 2006-07. As per the ruling of the Authority on Advance Rulings cited by the original authority, an SSI unit can accumulate capital goods credit till it exhausts the exempted value of clearances and starts paying duty. As per the CBEC's clarification cited by him, SSI units can accumulate credit of duty paid on capital goods which can be used after it crosses the aggregate value of exempted clearances as per the notification. We find that the imp....