TaxTMI 
TaxTMI 
2007 (6) TMI 364
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....s and availed Cenvat credit 50% of the amount of duty paid on such capital goods in that financial year. In the same financial year, the appellants availed depreciation under Section 32 of the Income Tax Act, 1961 on the balance 50% of the amount of duty, which was not taken as Cenvat credit in the financial year 2001-2002. The appellants availed 50% balance Cenvat credit of the amount of duty paid on capital goods during the financial year 2002-2003. Show cause notice was issued to the appellants for showing cause as to why this amount of credit availed by them in the financial year 2002-2003 be not denied, as it was in violation of provisions of Rule 4 of the Cenvat Credit Rules, 2001 and Cenvat Credit Rules, 2002. The appellant contested....
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....ing to justify that they are entitled to the benefit of Cenvat credit in the financial year 2002-2003, for the balance amount of 50% of duty paid on the capital goods, on the ground that they had not availed the depreciation on the said amount in the financial year 2002-2003. For this proposition, they are relying upon the decision of the Division Bench of the Tribunal in the case of Suprajit Engineering Ltd., (supra). 6. The provisions of availing the Cenvat credit on the capital goods procured by an assessee are covered by the Rule 4 of the Cenvat Credit Rules. The relevant portion read as under :- 4 (2) "The Cenvat credit in respect of capital goods received in a factory at any point of time in a given financial ....
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....learly indicates that if a manufacturer claims depreciation, Cenvat credit shall not be allowed in respect of that part of the value of the capital goods, that is to say that no credit can be allowed on the amount of duty on which depreciation has been claimed by the assessee. The provisions of sub rule (4) of Rule 4 of Cenvat credit rules are very clear and unambiguous. 8. The Division Bench in the case of Suprajit Engineering Ltd., (supra) has held as under :- "A careful reading of Rule 4 reveals that in respect of Capital Goods received in a factory at any point of time in a given financial year, only 50% of the duty paid can be taken as Cenvat credit. In the present cases, the appellants had taken only 50% of the duty paid on Cap....
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....in any provision, as to suggest that the appellants should not have claimed depreciation in the subsequent financial year for the same amount. I am unable to persuade my mind, to consider that the said judgement is covering the issue in the current appeal before me. 10. Ld. Counsel submits that since the judgement and order in the case of Suprajit Engineering Ltd., (supra) is given by a Division Bench, it is binding on me. There cannot be any doubt on that point, as per judicial discipline judgement and order of the Division Bench is binding on the single member bench and has to be followed. The Constitution Bench of Hon'ble Supreme Court of India in the case of P....