Applicability of serial number of Customs notification decided unilaterally: CESTAT quashes Disallowance of CENVAT Credit

The Mumbai bench of CESTAT ruled in favor of a manufacturer of bulk drugs, overturning the disallowance of CENVAT credit. The dispute arose when the Revenue claimed the manufacturer should have availed full exemption under a specific Customs notification, which would have rendered their duty payments unnecessary. The tribunal found the Revenue's decision unilateral and unsupported, as it didn't provide the manufacturer a chance to contest the application of the exemption. Therefore, CESTAT set aside the Revenue's order, allowing the manufacturer to retain the CENVAT credit amounting to Rs. 66,29,230/- for the period in question. The decision underscores the importance of procedural fairness in tax disputes.