2025-VIL-1937-CESTAT-ALH-CE
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CENTRAL EXCISE CESTAT Cases

Central Excise - CENVAT credit on Capital goods imported under EPCG scheme, Special Additional Duty (SAD) on capital goods – Appellant availed CENVAT credit on Customs EC&SHEC paid on imported goods, duty paid on capital goods imported under EPCG scheme which were later destroyed in a fire accident and not in possession of the appellant on the date of availing credit, and Special Additional Duty (SAD) paid on capital goods imported - Whether the appellant was eligible to avail CENVAT credit on Customs Education Cess and Customs Secondary & Higher Education Cess paid on imported goods – HELD - The CENVAT Credit Rules, 2004 allow credit only on the specified duties mentioned in Rule 3(1) of CCR, 2004, which does not include Customs Education Cess and Customs Secondary & Higher Education Cess. Merely paying these cesses along with the Customs duty does not make them eligible for CENVAT credit. The adjudicating authority rightly disallowed the credit of these cesses - the demand along with interest and penalties imposed on the appellant for the ineligible CENVAT credits availed is upheld and the appeal is dismissed - Whether the appellant was eligible to avail CENVAT credit on the duty paid on capital goods imported under EPCG scheme which were later destroyed in a fire accident and not in possession of the appellant on the date of availing credit - HELD - The appellant had failed to fulfill the export obligation under the EPCG scheme, and the capital goods were destroyed in a fire accident before the prescribed period for fulfilling the export obligation. Since the goods were not in the possession of the appellant on the date of availing the credit, the Tribunal held that the credit was not admissible under Rule 4(2)(b) of the CENVAT Credit Rules, 2004 - Whether the appellant was eligible to avail CENVAT credit on the Special Additional Duty (SAD) paid on the capital goods imported – HELD - The CENVAT Credit of SAD was admissible only from 1st March 2005 as per Notification No. 13/2005-CE (NT) dated 1st March 2005. Since the capital goods were imported prior to this date, the credit of SAD was not admissible to the appellant under Rule 3(1) of the CENVAT Credit Rules.
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