ACE TIMEZ Vs. COMMISSIONER OF CENTRAL EXCISE, BANGALORE

JUDGEMENT

(1.) THIS stay application is filed by the applicants for the waiver of pre -deposit of duty amounting to Rs. 2,43,720/ - and stay of the recovery proceedings.

(2.) THE issue relates to Cenvat credit on capital goods. The Department has disallowed Cenvat credit on capital goods in terms of Rule 4(2)(a) of Cenvat Rules on the ground that party has not availed 50% of Cenvat within the financial year. As per Rule 4(2)(a), the Cenvat credit in respect of capital goods received in factory at any point of time in a given financial year shall be taken only for an amount not exceeding 50% of the duty paid on such capital goods in the same financial year.

(3.) THE Counsel appearing for the applicants in support of the stay application submitted that only maximum was prescribed in the said Rules and in the instant case since the unit was started at the end of the year, they could not avail within the financial year, nevertheless, same has been availed on 1 -4 -2001. He also referred to the Circular No. 199/33/96 -CX., dated 23 -4 -96 wherein it clarifies that in the case of capital goods, it may not be always possible to avail the credit within six months from the date of issuance of the documents. He also relied upon the decision of the Tribunal in the case of Surya Prabha Mills Ltd. [2002 (149) E.L.T. 929 (Tri. - Chennai)] in support of his contention that no restriction in the time -limit fixed for taking the credit in respect of capital goods under rules pertaining to availment of Modvat credit, referring to the Circular referred to above.