2017 (5) TMI 896

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....pital goods procured by them. The dispute in the present appeal relates to demand of Cenvat credit of Rs. 12,99,32,128/- from the appellant, on the ground that they have cleared the capital goods as such and did not bring back the same within 180 days and thereby violated the provisions of Rule 3 (5) of Cenvat Credit Rules, 2004. The proceedings initiated against the appellant resulted in the impugned order. The Commissioner ordered the recovery of the above-mentioned amount and imposed penalty of equivalent amount under Rule 15 of Cenvat Credit Rules, 2004 readwith Section 78 of the Finance Act, 1994. 2. The learned Counsel for the appellant submitted that the appellants are engaged in providing telecommunication services in Rajasthan T....

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....h credit has been taken is removed without reversal of credit, the same is in violation of Rule 3 (5) of the Cenvat Credit Rules, 2004. 4. We have heard both the sides and perused the appeal records. We note that there is no dispute regarding eligibility of the appellant for Cenvat credit on various capital goods. The dispute is that the appellants have cleared these capital goods to various premises for installation. Since, the credit on these goods were taken indicating the registered premises, it was alleged that, their clearance to various other unregistered premises will amount to clearance of credit availed goods, as such. By applying the provisions of Rule 3 (5) the credit availed on all these goods were sought to be recovered. We....

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....umption that all capital goods have been received to a registered premises and thereafter were cleared 'as such' to various other unregistered premises. We find no support for such understanding by Revenue. The Original Authority recorded that proviso to sub-Rule (5) of Rule 3 of Cenvat Credit Rules, 2004 was amended w.e.f. 01/04/2008, where the provider of output service need not pay the credit amount when the capital goods are removed outside the premises. We are of the view that in the absence of any allegation of diversion of capital goods for other than intended purpose or their clearance to third party, the Revenue is not justified in denying credit on such capital goods which are admittedly installed and utilized for providing taxabl....