ORDER
P.G. Chacko, Member (J)
1. The present application is for early disposal of the appeal. After hearing both sides, we are of the view that the appeal itself requires to be disposed of summarily. Accordingly, after allowing the application, we take up the appeal.
2. The appeal is against denial of permission, by the lower authorities to the appellants, for transfer of unutilized CENVAT credit to the appellant’s Gujarat Unit. The appellant’s unit at Pondicherry was wound-up and the plant and machinery were transferred to their Gujarat Unit after taking permission from the departmental authorities. The relevant letter of the Assistant Commissioner of Central Excise, Pondicherry permitting shifting of factory and the relevant letter of his counterpart in Gujarat accepting the Gujarat Unit’s request for taking over the plant and machinery are available on record. When these permissions were granted, the appellant’s request for transfer of unutilized CENVAT credit on inputs to the CENVAT account of their sister unit was under examination. Eater on, the Assistant Commissioner of Central Excise at Pondicherry declined permission for transfer of the credit and the Commissioner (Appeals) sustained the decision of the lower authority. Hence the present appeal.
3. After considering the submissions of both sides, we note that the application for permission to transfer the credit was made under Rule 10 of the CENVAT Credit Rules, 2004. Sub-rule (1) of Rule 10 is as under:
If a manufacturer of the final product shifts his factory to another side or the factory is transferred on account of change in ownership or on account of sale, merger, amalgamation, lease or transfer of the factory to a joint venture with the specific provision to transfer of liabilities of such factory, then, the manufacturer shall be allowed to transfer the CENVAT credit lying unutilized in his accounts to such transferred, sold, merged, leased or amalgamated factory.
Sub-rule (3) states that transfer of the CENVAT credit under the above provision shall be allowed only if the stock of inputs as such or in-process, or the capital goods is also transferred along with the factory or business premises to the new site, or ownership and the inputs, or capital goods, on which credit has been availed are duly accounted for to the satisfaction of the Deputy Commissioner/Assistant Commissioner of Central Excise. In the present case, it is not in dispute that the appellants shifted their plant and machinery from Pondicherry to Gujarat after obtaining the requisite permission from the departmental authorities. It is, again, not in dispute that there was no stock of inputs as such or in process at the time of this shifting of factory. However, at that time, there was unutilized input-duty credit to the extent of over Rs. 33 lakhs in the relevant CENVAT account of the appellant’s Pondicherry Unit. It was this credit which was sought to be transferred to the Gujarat Unit. It is the Revenue’s case, reiterated by learned SDR, that such transfer of credit must be accompanied by physical transfer of inputs as such or in process. Learned consultant for the appellants has contested this stand of the Revenue. In this connection, he has relied on the decision of this Bench in CCE, Chennai v. Smithkline Beecham Consumer Health Care Ltd. 2007 (209) ELT 96 (Tri. Chennai), wherein, on a similar set of facts, it was held that physical transfer of inputs to the new site was not necessary for transfer of unutilized credit to the new unit. No case law to the contra has been cited by learned SDR. There is no case for the Revenue that the inputs on which the above credit had been availed were not duly accounted for by the appellants to the satisfaction of the jurisdictional Deputy/Assistant Commissioner of Central Excise at Pondicherry. Their only case is that there was no transfer of inputs as such or inputs in process along with capital goods to the Gujarat Unit. This argument belies logic inasmuch as it would mean that transfer of a factory from one site to another is not permitted in law if inputs have been wholly utilized in the manufacture of final products. The argument advanced on behalf of the department is to the effect that either input as such in stock or input in process must be physically available and the same should be transferred along with capital goods in connection with shilling of factory so as to claim transfer of unutilized CENVAT credit to the new unit. We find that, in the case of Smithkline Beecham Consumer Health Care Ltd. (supra) a similar situation was considered by this Bench and we held in favour of the party. The lower authorities ought to have allowed transfer of the CENVAT credit in question to the sister unit of the appellants
4. Learned consultant has also claimed interest on the amount of CENVAT credit. In this connection he has relied on case law. But we have not found any such claim having been raised before any of the lower authorities. There is no claim of such relief in the appeal memorandum before us either. Hence the claim for interest cannot be entertained.
5. For the reasons already recorded, we set aside the impugned order and allow this appeal.
(Dictated and pronounced in open court)