2017 (6) TMI 628

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....ed the same prior to the issuance of the Show Cause Notice. The Adjudicating Authority following the Board's Circular dated 03.09.2009 observed that interest is payable even when credit has not been utilized. I find that the Larger Bench of the Tribunal in the case of J.K.Tyre & Industries Ltd. v. Asst. Commr. of C.Ex., Mysore [2016 (340) E.L.T. 393 (Tri.-LB)] held that wrong availment of Cenvat Credit, interest is not payable, if reversed before utilization. The Tribunal in the case of Garden Silk Mills Ltd. v. Commissioners of Central Excise, Customs & Service Tax-Surat-I [2015 SCC Online CESTAT 2361] on the identical issue held in favour of the assessee. The relevant portion of the said decision is reproduced below:- "4. The learne....

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....udit. The appellants have not seriously contested the necessity or correctness of reversal of the Cenvat Credit before the lower authorities. However, they are seriously contesting the levy of interest and penalty. On the issue of levy of interest, there are conflicting decisions by various Hon'ble High Courts and different Benches of the Hon'ble Tribunal. It is seen that the Hon'ble High Court of Gujarat has observed in Para 7 in the case of Dynaflex Pvt. Ltd. (supra), as under : "7. In this regard it may be germane to refer to the decision of the Apex Court in the case of Commissioner of C. Ex., Mumbai-I v. Bombay Dyeing & Mfg. Co. Ltd., 2007 (215) E.L.T. 3 (S.C.), wherein it has held been that when an entry has been reversed before uti....