TaxTMI 
TaxTMI 
TaxTMI 
2025 (5) TMI 571
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....had failed to reverse input credit availed on Special Additional Duty of Customs attributable to inputs cleared 'as such' for the period August 2009 to October 2011. Consequently, a show-cause notice was issued to them on 04.01.2013 proposing to recover cenvat credit amounting to Rs.3,48,18,068/- wrongly availed during the period August 2009 to September 2012 with interest and penalty. On adjudication, the said demand was confirmed with interest and penalty. Hence, the present appeal. 3.1. At the outset, the learned senior advocate for the appellant has submitted that the appellant has four units and have separate Central Excise registrations. After introduction of LTU Scheme, they have also registered with LTU, Bangalore. He has submitted that the show-cause notice was issued to them invoking extended period of limitation for reversal of cenvat credit along with interest on clearance of inputs as such from one unit to their other unit. 3.2. He has further submitted that:- • In terms of Rule 12A of the Cenvat Credit Rules, 2004, unit in LTU could remove goods without reversal of credit to other units of the assssee registered under LTU. Rule 12A overrides the pro....
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.... months, could be initiated against the recipient unit and not against the unit which clears the inputs. • The demand is barred by limitation and consequently, penalty is not imposable. 3.3. In support of the above submissions, the appellant relied on the following decisions:- i. 3M India Ltd. Vs. CCE, LTU [2013(31) STR 110 (Tri. Bang.)] ii. Sharada Motor Industries Ltd. Vs. UOI [2011(267) ELT 634 (Bom.)] iii. Moser Baer India Ltd. Vs. CCE [2010(250) ELT 79 (Tri. Del.)] iv. Wolfra Tech (P) Ltd. Vs. CCE [2012(284) ELT 89 (Tri. Bang.)] v. Sanvijay Rolling & Engineering Ltd. Vs. Commissioner [2018(11) GSTL 344 (Bom.)] vi. Ericsson India Pvt. Ltd. CCE, Jaipur [2019(3) TMI 776 (Tri. New Delhi)] vii. GKN Driveline (India) Ltd. Vs. CCE, Delhi-III [2023(9) TMI 1131 (Tri. Chandigarh)] 4. Learned AR for the Revenue has reiterated the findings of the Commissioner. 5. Heard both sides and perused the records. 6. The issues involved in the present appeal for determination of are whether (i) the appellant are required to reverse cenvat credit taken on Special Additional Duty of Customs (SAD) on....
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.... inputs are cleared as such from the recipient premises, an amount equal to the credit taken in respect of such inputs by the sender premises shall be paid by the recipient premises with interest in the manner and rate specified under rule 14 of these rules: Provided further that if such capital goods are used exclusively in the manufacture of exempted goods, or such capital goods are cleared as such from the recipient premises, an amount equal to the credit taken in respect of such capital goods by the sender premises shall be paid by the recipient premises with interest in the manner and rate specified under rule 14 of these rules: Explanation 2. - If a large taxpayer fails to pay any amount due in terms of the first and second proviso, it shall be recovered along with interest in the manner as provided under rule 14 of these rules: 8. A plain reading of the said Rule reveals that a large tax payer unit allowed to remove inputs, except petrol high speed diesel and light diesel oil or capital goods, as such without payment of duty as required under sub rule (5) of Rule 3 of the CCR,2004, to his other registered premises under the cover of a challan or invoice.....
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.... the appellant that since there was no mechanism under Rule 3(5) of the CCR, 2004 to recover credit (SAD) under Rule 14 of CCR, 2004 on inputs cleared as such under Rule 3(5), the demand of the credit cannot be sustained, we find that this Tribunal in the cases of Ericsson India Pvt. Ltd. CCE, Jaipur (supra) and GKN Driveline (India) Ltd. Vs. CCE, Delhi-III (supra) observed that recovery of credit under Rule 3(5), (5A) and (5B) prior to 01.03.2013 is bad in law. 12. In view of the above, we do not find merit in the impugned order; consequently, the same is set aside and appeal is allowed with consequential relief, if any, as per law. (Order pronounced in Open Court on 02.05.2025) ============= Document 1 Stumpp, Schuele & Somappa Springs Private Limited HIGH QUALITY SPRING MANUFACTURERS Ref No SSS / LTU / 0503 Date : 05.03.2010 The Commissioner of Central Excise , Large Tax Payer Unit, J.S.S. Towers, 100 Feet Road, Banashankari Ill Stage, BANGALORE 560 085 Respected Sir, Sub: Reorganization of Business - Reg. Further to our letter dt 05.05.2008 regarding reorganization of our Spring Manufacturing units and non-Spring manufacturing units in to 2 separate....