2016 (2) TMI 1030

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....nother show cause notice raising the same allegation was issued for the period August, 2009 to April, 2010. These notices were adjudicated. Meanwhile, the Range Superintendent issued a letter dated 15-7-2010 to the appellant directing them to reverse the credit of Rs. 1,13,226/- availed on MS items for the period January, 2009 to July, 2009. It is submitted by appellants that due to pressure from department, they reversed the credit on 21-7-2010. They were advised that they could take the credit later. The appellants then took the credit of the same amount on 30-9-2010 on being advised by Jurisdictional Range Superintendent to do so. Thereupon, the present show cause notice was issued to them alleging availment of credit without any valid d....

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....ovisions by taking suo motu credit. There was no allegation that credit on MS items used is not admissible. The only allegation raised is that credit is not taken on proper documents. But the original authority as well as Commissioner (Appeals) travelled beyond the show cause notice to hold that the suo motu availment of credit is not proper. He relied upon the judgment laid in ICMC Corporation Ltd. v. CESTAT, Chennai - 2014 (302) E.L.T. 45 (Mad.). 3. Against this, the learned AR Shri Shastry argued that the appellants could not take credit suo motu and therefore the findings of the authorities below are justified. However, he was fair enough to concede that no show cause has been issued alleging irregular availment of credit on MS ....

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....l). In the said case the issue under consideration was whether the appellant therein could have taken suo motu re-credit. In the instant case, the said issue having not been alleged in the show cause notice, the Revenue cannot disallow the credit on this ground. The said case therefore does not assist the department. 5. In the case in hand, the disallowance of credit for the reason that appellant cannot take suo motu credit is not sustainable since no such allegation was raised in the show cause notice. The appellant had availed credit initially on proper duty paid documents, and filed ER-1 returns. They reversed the credit pursuant to the letter issued by Range Superintendent. On understanding that they need not reverse the credit,....