2007 (3) TMI 277 - HC - Central Excise

Summary

Issues Involved:
Interpretation of Rule 57AC of Central Excise Rules by the Tribunal
Justification of the Tribunal in deciding the appeal without recourse to Rule 57AD of Central Excise Rules

Interpretation of Rule 57AC of Central Excise Rules by the Tribunal:
The appellant sought leave to amend the questions of law, focusing on the interpretation of Rule 57AC of the Central Excise Rules by the Tribunal. The appellant's counsel contended that the Tribunal had erred in its interpretation, emphasizing that the reversal of credit availed should not impact the application of Rule 57AD. However, the respondent's counsel referenced a Supreme Court judgment in Eicher Motors Ltd. v. Union of India, highlighting that the provision for credit is akin to tax paid until adjusted on future goods. The Supreme Court's stance clarified that the rule does not apply to goods manufactured before a specific date, where credit had been availed for further manufacturing purposes. Consequently, once credit is availed and reversed, the assessee is deemed as not availing the credit.

Justification of the Tribunal in deciding the appeal without recourse to Rule 57AD of Central Excise Rules:
After considering the arguments and the Supreme Court's precedent, the High Court concluded that no substantial question of law was present in the appeal. Consequently, the appeal was dismissed based on the interpretation and application of Rule 57AC of the Central Excise Rules, as clarified by the Supreme Court's judgment. The High Court's decision was influenced by the understanding that the rule does not apply retroactively to goods manufactured before a specific date with credit availed for further manufacturing, emphasizing the treatment of credit availed and reversed.