2021 (7) TMI 1347

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....nfirmed the central excise duty demand under Rule 6(3)(b) read with Rule 14 of the Cenvat Credit Rules, 2004 Rules for the period of September 2006 to September 2008. 2. Briefly stated in the facts of the case, the assessee is engaged in the business of manufacture of railway wagons, parts thereof and allied products. Apart from the sale of dutiable excisable goods, the appellant is also removing exempted goods. During the period in dispute, the appellant has cleared goods to Indian Railways by  claiming central excise duty exemption under Notification No 6/2002 dated 01.03.2006. The appellant has also claimed exemption under Notification no. 10/97-CE dated 01.03.20 07 for clearance of goods to Ministry of Defence. The instant deman....

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....y reversed the Cenvat credit to the tune of Rs.23,87,696/- and 36,17,880/- in the course of adjudication for credit pertaining to clearance of exempted goods, which fact has been duly noted in the adjudication order and further the said amount has been appropriated towards the duty demand. Further, in Para 5.8.2 of the impugned order, it has been noted that the appellant had reversed the credit voluntarily along with interest of Rs 6,81,409/-.The Ld. Commissioner has not disputed the calculation of the amount reversed by the assessee at the adjudication stage and has merely chosen to confirm demand of the disproportionate credit amount by applying 10% of the value of exempted goods. 7. The Appellant relies upon the judgement of the Hon'b....

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.... us, have not only reversed the credit of Rs. 70,21,383/- but also paid the interest of Rs. 4,71,189/-. We feel that by doing so, the appellants, have undone the act of taking/utilizing the credit and in the light of the Allahabad and Gujarat High Court judgments supra, it amounts to not taking the credit and, therefore, they are not required to pay an amount equal to 10%." Further in a similar matter, rejecting the Departmental appeal in the case of C.C.E. vs Mann Pharmaceuticals (Supra), the Hon'ble Gujarat High Court has observed that :- "7. As can be seen from the impugned order of the Tribunal, the Tribunal has merely followed the decision of the Supreme Court in the case of M/s. Chandrapur Magnet Wires Ltd. (supra), as wel....