TaxTMI 
TaxTMI 
2004 (3) TMI 596
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....n respect of their inputs. On 30-3-2001, they had taken CENVAT credit of Rs. 46,600/- in respect of inputs which were not available in their registered factory premises. Another credit of Rs. 51,811/- had been taken on inputs on 19-3-2001, i.e. prior to the date of Central Excise registration. The party had also taken CENVAT credit of Rs. 30,05,054/- during the period March 2001 to February 2002 in respect of inputs which at the material time were stored outside the factory premises without prior permission of the jurisdictional Commissioner of Central Excise. All these credits were disallowed by the original authority, which also imposed a penalty of Rs. 31 lakhs on the party. The aggrieved party preferred appeal to the Commissioner (Appea....
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....r examining the rival contentions, we note that the relevant rule to be considered is not Rule 57A referred to by counsel but Rule 57AB(1) relied on by ld. Commissioner (Appeals). We have perused the text of Rule 57AB(1). This rule says that the inputs should have been received in the factory on or after 1-3-2001. There was no allegation that the inputs in question were not so received in the assessee's factory, nor was it alleged that the inputs were not duty-paid and not used in the manufacture of final products. It therefore appears to us that the Cenvat credit of Rs. 46,600/- has been disallowed to the assessee without justification, particularly when no other ground was raised in the show-cause notice to deny the credit. (b) CE....
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....t as no invoices/subsidiary gate passes can be issued from the storage space outside the factory, there is a danger of Modvat credit being lost. 2. The matter has been examined by the Board and it has been decided to allow Modvat credit in such type of situations where the manufacturer after buying the goods cannot bring these inputs inside the factory premises on account of shortage of storage space, hazardous nature of inputs etc. I am further directed to say that such manufacturers can seek permission for storage of Modvatable goods outside the factory premises from the Jurisdictional Commissioner of Central Excise and the said permission will be granted treating the storage point as an extension of the factory premises. Suita....