TaxTMI 
TaxTMI 
TaxTMI 
2026 (4) TMI 210
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.... the CENVAT Credit Rules, 2004 [CCR, 2004] The Appellant imports and also locally procures components/inputs and capital goods for use in the manufacture of the aforesaid final goods and avail the benefit of CENVAT Credit thereon. The Central Excise Audit team, Noida visited Appellant's premises and audited records for the period from June 2012 to March 2013 and it was observed that the Appellant was involved in trading of goods which being exempted activity, was required to reverse 5% (i.e. Rs.2,89,832/- for the year 2011-12 on value of exempted services of Rs.57,96,644/-) and 6% (i.e. Rs.3,50,486 498675-148189 (already paid on 09.09.2013 with interest) for the year 2012-13 on value of exempted services of Rs.83,11,253/- during the year 2012-13). Accordingly Rs.6,40,318/- (2,89,832+3,50,486) was required to be recovered from the Appellant. 3. It is submitted that the demand for Rs.2,89,832/-for the year 2011-12 did not at all relate to any trading as alleged in the audit report. This amount in fact related to the removal of 'components' of the final product "as such" to Appellant's sales company 'M/s PANASONIC INDIA' as these items were required by them for afte....
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.... case, evidence and material available on record, the grounds of the appeal and the submissions made by the appellant during the course of the personal hearing. From facts of the case. I observe that the department has sought reversal of Rs.14,32,091/-under Rule 6(3) of the Cenvat Credit Rules, 2004 in respect of trading activity of goods which was an exempted service as set out in Annexure A' to the SCN AS under: 2011-12 Rs.2.89,832/- on clearance of input as such 2012-13 Rs.3,50,486/- on clearance of DVD 2013-14 Rs.7,91,772/- on trading of TV and DVD 4.1. I will first take up the issue of demand relating to reversal in respect of inputs cleared by the appellant 'as such' under the provisions of Rule 3(5) of Cenvat Credit Rules, 2004. The appellant have contended that the figure was reflected in the balance sheet of the appellant as was pointed out by the audit which makes them liable to reverse the amount of duty of Rs.2,89,832/-. It was further submitted that adjudicating authority did not consider their submission that removal of the components for use of their final product under warranty by their sales company did not amount to ....
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....rovisions of Rule 3(5) of Cenvat Credit Rules, 2004, I hold that removal of the inputs cleared by the appellant as such' under Rule 3(5), ibid, cannot be treated as trading activity. Therefore such removal of inputs as such are out of the purview of Rule 6(3) of the Cenvat Credit Rules, 2004. I therefore hold that the confirmation of the demand of Rs.2,89,832/- with interest and penalty in respect of clearance of input 'as such' in the impugned order is liable to set aside. 4.5 As regards the demand of Rs.3,50,486/- on clearance of DVD for the year 2012-13, 1 observe from the case record, that an amount of Rs. 3,50,487 has already been deposited by the appellant vide challan No. 00095 dated 09.09.2013 along with interest of Rs.24840/-vide challan No.00140 dated 19.08.2013. 1 thus find that the appellant has not disputed the demand of reversal of Rs.3,50,486/- on clearance of DVD for the year 2012-13 and deposited Rs. 3,50,487/- along with interest of Rs.24840/-. Therefore the said confirmation of demand with interest and penalty is upheld. 4.6 As regards the demand of reversal of Rs.7,91,772/- on trading of TV and DVD for the year 2013-14, I find that ....
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....ant for 2013-14, the concerned Range Officer has verified that an amount of Rs.62,40,815/- has been deposited by the appellant month wise and the same has also been shown in corresponding ER-I Returns. Thus there remains no doubt about the deposit/reversal of Rs.62,40,815/-as claimed by the appellant. I thus find substance in the contention of the appellant that there was an excess reversal/deposit in respect of trading of TV and DVD for the year 2013-14. 1 therefore hold that the demand of reversal of Rs.7,91,772/- with interest and penalty in respect of trading of TV and DVD for the year 2013-14 is liable to be set aside with consequential relief subject to the verification of the actual nature of the deposit/reversal from the relevant records." 8. Accordingly, learned Commissioner (Appeals) passed the following order:- ORDER (i) the confirmation of the demand of Rs.2,89,832/- with interest and penalty, in respect of clearance of input 'as such' for 2011-12, is set aside. (ii) the confirmation of demand of Rs.3,50,486/- with interest and penalty on clearance of DVD for 2012-13 is upheld. (iii) the confirmation of demand of Rs.7,91,772/- wi....