2015 (11) TMI 1335

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....99, the Applicant had also used the capital goods in the manufacture of exempted goods. Thus, the Tribunal has committed an apparent mistake in holding that the capital goods were also used in the manufacture of exempted final product. It is submitted that after taking credit on 17.03.1999, the capital goods are used in the manufacture of dutiable final product. Further, in Para 12 of the order of the Tribunal, the findings are factually and patently incorrect and failed to appreciate the case laws in proper manner. Furthermore, in Para 12 of the order, the findings of the Tribunal on the decision of Hon'ble Karnataka High Court in the case of CCE Bangalore Vs Kailash Auto Builders Ltd  2012 (280) ELT 49 (Kar.), as relied upon by t....

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.... final product on the date of receipt of the goods or the date of utilization of eligibility 50% credit. The Larger Bench answered the reference by holding that the CENVAT Credit eligibility is to be determined with reference to the dutiability of the final product on the date of receipt of the capital goods. The relevant portion of the decision of Larger Bench in the case of Spenta International Ltd (supra) is reproduced below:- "8. The recent decision of the Tribunal? in CCE v. Precot Mills Ltd., 2007 (212) E.L.T. 483 follows the Surya Roshni decision and the Grasim Industries decision as well as the Sengunthar decision, to hold that the relevant date for determination of availability of Modvat credit is the date of receipt of capital g....

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....arned Advocate also submitted that the entire demand is barred by limitation. In this context, it is contended that there is divergent view on the issue of eligibility of MODVAT Credit of capital goods which was decided by the Larger Bench of the Tribunal. On perusal of the impugned order, I find that there was a declaration filed by the assessee that the impugned capital goods would not be used exclusively in the production of final product, which was exempted from payment of whole excise duty leviable thereon. This was a statutory declaration filed by the assessee under the then Rule 57T of the erstwhile Central Excise Rules 1944. But, the fact remains that the appellant used the machinery exclusively in the manufacture of the exempted pr....

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....t the capital goods (in question) shall not be used exclusively for the production of a final product which is exempt from the whole of duty of Excise leviable thereon or is chargeable to Nil rate of duty. But, on the other hand, Shri Nalin Desai, in the said statement recorded on 22.12.2003, has admitted that after installation of the said capital goods, the Assessee were not manufacturing any dutiable goods or goods which were cleared on payment of duty. Shri Nalin Desai further admitted that the final product Poly Carbonate Bottles remained exempt from Central Excise duty till June 1988. Shri Desai further stated that they had paid the duty leviable on the Poly Carbonate Bottles which were removed at Nil rate of duty from June 1998 till ....