2018 (11) TMI 1199

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....d that the said activity tantamounts to "trading" and that the appellants were not eligible for credit on the same. It was further alleged that the assessee ought to have maintained separate accounts for common inputs/input services which have gone into the manufacture of both dutiable goods and exempted services and should have followed any of the three options as envisaged in Rule 6(3) of the CENVAT Credit Rules, 2004. Accordingly, a Show Cause Notice dated 04.04.2016 was issued proposing to demand 5%/6%/7% on the value of the exempted clearances during the said period, thereby invoking the extended period of limitation under Section 11A of the Central Excise Act, 1944. The Deputy Commissioner of Central Excise, Coimbatore-III, vide Order....

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.... under the provision of Rule 3(5) by reversing the credit. The Tribunal, in the case of Suyash Auto Press Components and Assemblies Pvt. Ltd. (supra), had occasioned to consider a similar issue. The tribunal observed as under: - '2. Shri Prasad Kshirsagar, learned Chartered Accountant appearing on behalf of the appellant submits that they are removing the input as such under Rule 3(5) of the Cenvat Credit Rules, 2004 on payment of excise duty which is equal to the cenvat credit. Therefore, Rule 6(3) should not be applied and accordingly the demand is not sustainable. He placed reliance on the following judgments: - (i) CCE, Ahmedabad- II vs Inductotherm (I) Pvt. Ltd. - 2013 (1) ECS (26) (Guj-HC); = 2012-TIOL-929-HC-AHM-CX (ii) AR C....