WIPRO LTD. Vs. COMMISSIONER OF CENTRAL EXCISE

JUDGEMENT

(1.) THE applicant had two units adjacent to each other. One of the units was clearing goods into DTA and the other unit was functioning as a 100% EOU. Both the units were taking Cenvat credit separately. During 2007, both the units got merged as per Rules and procedures to be followed for the said purpose and became one DTA unit. The Cenvat credit which was available in the books of account of EOU was transferred into the books of account of DTA unit. Revenue has taken objection that such transfer was not permitted and proceeded to recover amount so transferred. On adjudication, an amount of Rs. 4,50,46,157/ - has been confirmed against the applicant along with interest and penalty. Aggrieved by the order of the Commissioner, the applicant has filed this appeal along with stay petition for waiver of pre -deposit for admission of the appeal. The learned Advocate submits that provisions of Rule 10 of Cenvat Credit Rules, 2004 would cover this type of situations also, though it is not explicitly mentioned. He argues that Cenvat credit was available to both the units and when they became one unit there was no reason to deny the credit in the hands of the merged unit. He relies on the unconditional stay order passed by the Mumbai Bench of the Tribunal in the case of Technocraft Industries (India) Ltd. v. CCE -, 2011 (274) E.L.T. 446 which granted unconditional waiver in identical situation. He also relies on the decision of the Tribunal in the case of Sun Pharmaceuticals Industries Ltd. v. CCE - : 2010 (251) E.L.T. 312 which dealt with the reverse situation of conversion from DTA to EOU and allowed the appeal. Therefore, he submits that the stay petition be allowed.

(2.) HE also argued that the merger and transfer of credit was intimated to the Department vide letter dated 9 -4 -2007 which was acknowledged by the Deputy Commissioner of Central Excise, Poonamallee Division Chennai and therefore on limitation also they have a strong case.