2008 (11) TMI 211

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....used faster, while other items of inputs which are meant for the inks which are not much in demand, get used slowly. In the balance sheet 2003-04, a provision was made for non-moving/show moving or obsolete items of inputs in the books of accounts. Based on this entry in the balance sheet, the Department, relying upon the Board's circular No. 645/36/2002-CX dt. 16-7-02 issued a show cause notice dt. 26-4-05 for denying Cenvat credit amounting to Rs. 2,61,327/- availed in respect of slow moving/non-moving inputs as identified by the Appellant in their balance sheet. The Dy. Commissioner vide Order-in-Original dt. 24-11-05 confirmed the demand of Cenvat credit relying upon the Board's circular and alongwith interest on it at the applicable ra....

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....e cited the judgment of the Tribunal in the case of BHEL v. CCE, Bangalore reported in 2002 (50) RLT 208 wherein it was held that when the inputs are still lying in the factory, though have been written off in books of accounts, credit is not deniable on the presumption that inputs may not be used as there is no time limit for consumption. He also cited the Tribunal's judgment in the case of CCE, Nagpur v. Ultra Tech Cement Ltd. reported in 2008 (223) E.L.T. 303 wherein it was held that when inputs viz, spares, though written off from books of account by the assessee as being unusable, are in fact, physically available in factory premises and parts of such spares have been used subsequently, in such situation, the credit of duty is admissib....