2007 (1) TMI 9 - AT - Central Excise

SSI Notification and Modvat credit Appellants were availing benefits of SSI Notification and credit simultaneously on the same good Revenue has against the appellant After considering all details authority decided in favour of appellant

Summary

Issues:
1. Small scale exemption notification denial and penalties imposition.
2. Cum-duty price benefit denial.
3. Modvat credit entitlement and duty recalculations.
4. Exported goods duty sustainability.

Analysis:
1. The appellants, engaged in manufacturing various goods, appealed against an order denying small scale exemption notification and imposing penalties. The Revenue contended that simultaneous availment of exemption under Notification No. 1/93-CE and Modvat facility on different goods was impermissible. The Tribunal referred to the Supreme Court decision in CCE v Ramesh Food Products, which held against simultaneous benefits. Consequently, the denial of the small scale exemption notification was upheld.

2. The appellant argued that duty was demanded without allowing the benefit of cum-duty price. Citing the Supreme Court decision in CCE v. Maruti Udyog Ltd., the appellant claimed entitlement to cum-duty price benefit. The Tribunal acknowledged the ruling and directed duty recalculations to incorporate the cum-duty price benefit.

3. The appellant contended they were entitled to credit for inputs used in manufacturing goods on which duty was confirmed. Additionally, they argued that duty demand on exported goods was unsustainable. Referring to the Supreme Court's decision in Ramesh Foods and the Tribunal's decision in Faridabad Tools Pvt Ltd., the Tribunal noted the overruling of the latter by the former. Consequently, the imposition of penalty was deemed unsustainable, and the appellant was granted Modvat credit and duty recalculations.

4. The Tribunal, in line with the Supreme Court decision in Maruti Udyog Ltd., directed duty recalculations considering the benefit of cum-duty price. Moreover, the appellant was entitled to Modvat credit for duty paid on inputs used in manufacturing goods with confirmed duty. The duty was to be requantified after verifying the exports made by the appellant. Ultimately, the appeals were disposed of in favor of the appellant, granting the requested reliefs.