CEA No.106 of 2011 (O&M) -1- IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH CEA No.106 of 2011 (O&M) Date of decision: 17.04.2012 Commissioner of Central Excise, Central Excise Commissionerate, Ludhiana ....Appellant Versus M/s Godson Spinners Ltd. ....Respondent CORAM: HON'BLE MR. JUSTICE M.M. KUMAR HON'BLE MR. JUSTICE ALOK SINGH Present: - Mr. Kamal Sehgal, Advocate, for the appellant. 1.Whether to be referred to the Reporters or not? 2.Whether the judgment should be reported in the Digest? ***** ALOK SINGH, J. 1. Present appeal is filed under Section 35-G of the Central Excise Act, 1944 assailing the order dated 15.3.2011 passed in Excise Appeal No.142 of 2005 by the Customs, Excise and Services Tax Appellate Tribunal, New Delhi. 2. Brief facts of the present case, inter alia, are that respondent- company is engaged in manufacturing of cotton yarn classifiable under Chapter 52 and has availed Cenvat Credit on the capital goods to the tune of ` 10,55,996/- during the period from September, 2001 to March, 2002 being 50% of the total credit of ` 20,84,742/- pertaining to the capital goods received by them during the period from April, 2000 to September, 2000. Under Notification No.47/2000 dated 1.9.2000, exemption limit of SSI units was raised to ` 1,00,00,000/-, therefore, the company surrendered their central excise registration and at the time of CEA No.106 of 2011 (O&M) -2- surrendering registration respondent-company had a credit balance of ` 10,42,371/- out of the said total cenvat credit amount to ` 20,84,742/- in relation to the duty paid on the capital goods during the period from April, 2000 to September, 2000. However, in the year 2001, SSI exemption on cotton yarn was withdrawn. Accordingly, the respondent- company again got registered with the Central Excise Department on 2.3.2001 and proceeded to avail the benefit of the credit to the tune of ` 10,42,371/- being the opening balance of the cenvat credit in March, 2001, which was lying in the balance account at the time of surrender of the registration in December, 2000. The respondent-company has utilized the said balance credit availed in relation to the capital goods during the period from September, 2001 to March, 2002 and has revealed the same from RT-12 return, however, show-cause notice dated 21.9.2001 and 30.10.2002 were issued, which were contested by the respondent-company. 3. Learned Tribunal in the case of J.R. Herbal Carer India Ltd. vs. Commissioner of Central Excise, Noida, 2010 (253) E.L.T. 321 (Tri. Del.), has held as under: - “..........A manufacture manufacturing excisable goods but exempt from registration formalities under Rule 9 (1) for the reason that he is availing SSI exemption and the value of his clearances during the financial are within the full exemption limit, does not cease to be a manufacturer of exisable goods and therefore, capital goods Cenvat credit in terms of the provisions of Rule 3(1) read with Rule 4 of CCR, 2002 could not be denied to him for this reason.” 4. On being asked as to whether judgment in the case of J.R. Herbal (supra) was challenged by the department, Mr. Kamal Sehgal, learned counsel for the appellant, has fairly stated that it was never CEA No.106 of 2011 (O&M) -3- challenged. 5. From the admitted facts, as narrated hereinabove and more particularly in view of the fact that registration was surrendered because of Notification No.47/2000 dated 1.9.2000 enhancing the exemption limit of SSI units to ` 1,00,00,000/- and was again obtained after withdrawal of the enhanced exemption and meanwhile respondent did not stop the manufacturing activities, we find no merit in the appeal and same is devoid of any merit. Hence is dismissed. (M.M. Kumar) Judge (Alok Singh) Judge April 17, 2012 R.S.