TaxTMI 
TaxTMI 
2017 (1) TMI 801
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....ds are received in the factory premises for intended production of dutiable final products, and Whether the Cenvat Credit taken lawfully under Cenvat Credit laws on the receipt of capital goods in the factory can be denied later on at a subsequent stage, when the final product becomes exempted. 2. The brief facts are that the assessee, Gokul Food Pvt. Ltd., is engaged in manufacture of Glucose biscuits and Cream biscuits falling under chapter Sub-Heading 19053100 of the first schedule to CETA, 1985. The assessee was manufacturing biscuits with their existing plant and machinery from before. From the records of the assessee, Revenue observed that during the month of March and April, 2007 the assessee had received new plant and machiner....
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....03.09.2007 and the final trial of the new machines and oven was done on 17.10.2007 and thereafter, commercial production started from 31.10.2007. It further appeared that after the commencement of commercial production of the new oven, the old oven was dismantled from the old Hall and was shifted to the new Hall adjacent to the new oven. All the capital goods acquired as detailed in para-11 of the SCN were put to use either in new oven or in old oven or both, after their installation in the new Hall. 2.1 Accordingly, it appeared to Revenue that the Cenvat Credit availed Rs. 17,97,968/- including cess is not available to the assessee as the capital assets newly acquired have been exclusively used in manufacture of exempted goods only. The....
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.... with equal amount of penalty and interest. Being aggrieved, the appellant again preferred appeal before the Ld. Commissioner (Appeals), who vide the Order-in-Appeal dated 20.11.2012 have been pleased to allow the appeal, holding that Cenvat Credit have been rightly taken when the goods were received in the factory of manufacture (when such goods manufactured by the appellant, were taxable) and their subsequent exemption, vide Notification dated 03.05.2007 is irrelevant for the purpose of taking Cenvat Credit. He has further held that once the Cenvat Credit is rightly taken, there is nothing wrong to its utilisation in payment of duty under the Cenvat Credit Rules. The Ld. Commissioner have relied on the larger Bench ruling o this tribunal ....
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....oods or in providing exempted services, other than the final products which are exempt from the whole of the duty of excise leviable thereon under any notification where exemption is granted based upon the value or quantity of clearances made in a financial year." 6. It is strongly contended by learned AR for Revenue that the Rule makes it absolutely clear, that Cenvat credit is not admissible, if same is used in the manufacture of final products, which are exempt from whole of the Central Excise duty. In the instant case, the new plant against which credit was taken, was installed after the final product i.e. biscuits became exempt and hence, the credit is not admissible to the party in terms of Rule 6(4) of CCR, 2004. 7. Heard learn....