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CENVAT - Inputs received in 2003 to 2005 and credit taken in 2006 - there is no time period prescribed in CCRs - Merely because Tribunal took view that one year is reasonable period does not mean that if credit is not taken within one year, it is inadmissible: CESTAT

By TIOL News Service

MUMBAI, DEC 31, 2014: THIS is a Revenue appeal filed in the year 2009.

The respondent procured inputs namely "Oxygen" during the period April 2003 to October 2005 and they have taken the credit in October 2006. Revenue was of the view that CENVAT credit has been availed with an inordinate delay and, therefore, the same is not allowed as per Rule 4(1) of the CCR, 2004.

The Commissioner (Appeals) set aside the order passed by the adjudicating authority. He held that there is no time period to take CENVAT credit during the impugned period, therefore, the CENVAT credit was allowed.

Aggrieved, Revenue is in appeal before the Tribunal.

The matter was heard recently.

The AR relied upon the decision in the case of CCE vs. Mold-tek Technologies Ltd. - 2006-TIOL-612-CESTAT-BANG and submitted that the reasonable period to take CENVAT Creditis one year.

On the other hand, the respondent relied upon the decision in SGS India Pvt. Ltd. vs CCE - 2011-TIOL-979-CESTAT-MUM where it was inter alia held - Appellant cannot be denied CENVAT credit on the ground that they have not taken the credit immediately on receipt of the goods - if the appellant has not taken the credit immediately, it is affecting the appellant not the Revenue because the appellant may fail to take credit-in-future or at least they are not having credit balance in the CENVAT credit account.

The Bench after considering the submissions observed -

"6. In CENVAT Credit Rules, 2004 there is no time period prescribed of taking the CENVAT Credit on inputs. In the case of SGS India Pvt. Ltd. (supra) the issue came up before this Tribunal and the Tribunal held that CENVAT credit can be taken at any time after purchase of the goods. Further the case law cited by the learned A.R. has no relevance to the facts of the present case as in that case the assessee took the credit within one year of the purchase of the inputs and this Tribunal held that the credit is taken within a reasonable time. Therefore it does not mean that if the credit is not taken within one year it is not entitled to take credit. With these terms, I do agree with the findings of the learned Commissioner (Appeals) holding that the respondents are entitled to take credit. Therefore the impugned order has no infirmity and the same is upheld…."

The appeal filed by the Revenue was dismissed.

(See 2014-TIOL-2645-CESTAT-MUM)


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