CESTAT upholds CENVAT credit reversal on ‘capital goods’ cleared under Rule 4(5)(a) of CENVAT Credit Rules, 2004 (CCR) to sister unit and not returned within stipulated period of 180 days of clearance; Rejects assessee’s case that since the machine was destroyed in fire accident along with certain other inputs, it could not be returned at all; Distinguishes Bangalore bench’s ruling in Zenith Machine Tools Pvt. Ltd. observing that in said case, machine wastransferred to sister unit but not destroyed or removed therefrom, whereas in present case, machine was not found at sister unit’s premises; Remarks, after availing credit, Revenue would have required assessee to pay the amount after expiry of 180 days and although same would have been available as credit to sister unit, still Govt. would have received money in cash; Accepts Revenue’s plea that situation is not ‘revenue neutral’ as pattern of credit utilizationin both units had not been declared, while noting that assessee had reversed credit of inputs destroyed but failed to intimate about destruction of capital goods within a reasonable period: CESTAT
Citation: [TS-428-CESTAT-2017-EXC]