As pers sec 11A if Cenvate Credit taken on capital goods and removed as such than assessee liable to refund the credit taken

Court :
HIGH COURT OF DELHI

Brief :
The brief facts leading up to the filing of the present appeals may be noticed. M/s. Harsh International Pvt. Ltd., one of the appellant, herein, is a company engaged in the manufacture of chewing tobacco. It was registered under the Central Excise Law for the manufacture of chewing tobacco under the brand name of “Mehak Chaini Khaini”. The company was availing the Cenvat credit on the capital goods under the Cenvat Credit Rules, 2004. On 1st July, 2007, it informed the Central Excise Authorities that pursuant to the withdrawal of the licences issued by the licensor, it has stopped production and clearance of the goods and that the factory would remain closed for an indefinite period and all manufacturing activity would stand suspended from 30th June, 2007. By letter dated 18th July, 2007, the appellant also surrendered in original the registration certificate issued by the Central Excise Authorities stating that it was no longer required. In the months of June and July, 2007, it sold the capital goods such as “old used filter pouch packing machine”, “old used HFFs machine PK 85”, “old used dust collector”, “old used packing and sealing machine”, “old used air compressor”, “old used grinder” and some other used machines to its sister concern, viz., Harsh International (Khaini) Pvt. Ltd., the other appellant herein, and did not pay any excise duty thereon, taking the position that under Rule 3(5) of the Cenvat Credit Rules, 2004 used capital goods, did not affect any duty nor was it required to reverse the cenvat credit which it availed of at the time of purchase between 2003 and 2005.

Citation :
COMMISSIONER OF CENTRAL EXCISE …..Respondent Through: Mr. Satish Kumar, Sr. Standing Counsel + CEAC NOs.12/2011 HARSH INTERNATIONAL PVT. LTD..... Appellant Through: Dr.Seema Jain with Mr.Ajay K.Jain and Mr.Dushyant K.Mahant, Advocates. VERSUS COMMISSIONER OF CENTRAL EXCISE …..Respondent Through: Mr. Satish Kumar, Sr.Standing Counsel