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TMI Blog2009 (12) TMI 125X X X X Extracts X X X X X X X X Extracts X X X X ..... credit taken by the assessee was not required to be reversed. He accordingly upheld the assessee’s claim. The Tribunal upheld the order of first appellate authority order. In the light of the decision of CCE v. Dai Karkaria Ltd. 1999 (7) SCC 448, held that- even though the final product of the assessee might be exempted from payment of excise duty, the assessee could not be asked to reverse the cenvat credit already taken by it. Thus the appeal of the revenue is liable to be dismissed. - 14 of 2008 - - - Dated:- 9-12-2009 - Deepak Gupta and V.K. Ahuja, JJ. Shri Sandeep Sharma, ASG, for the Appellant. Shri Karan Singh Kanwar, Advocate, for the Respondent. [Order per: Deepak Gupta, J. (Oral)]. - This appeal was admit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that it was not required to reverse the benefit of modvat credit taken by it on the inputs purchased prior to its opting to take benefit of the exemption notification referred to above. The Assessing Officer rejected the contention of the assessee. 4. The assessee filed an appeal and the same was accepted and it was held that the modvat credit obtained by the assessee was not required to be reversed. Thereafter, the revenue approached the Customs, Excise Service Tax Appellate Tribunal (CESTAT) which dismissed the appeal in view of the law laid down by a Five Member Bench in CCE, Rajkot v. Ashok Iron Steel Fabricators reported in 2002 (140) E.L.T. 277 (Tri.-LB) = 2002 (48) RLT 789. 5. The main argument of Sh. Sandeep Sharma, lea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... It is clear from these rules, as we read them, that a manufacturer obtains credit for the excise duty paid on raw material to be used by him in the production of an excisable product immediately it makes the requisite declaration and obtains an acknowledgement thereof. It is entitled to use the credit at any time thereafter when making payment of excise duty on the excisable product. There is no provision in the rules which provides for a reversal of the credit by the Excise Authorities except where it has been illegally or irregularly taken, in which event it stands cancelled or, if utilized, has to be paid for. We are here really concerned with credit that has been validly taken, and its benefit is available to the manufacturer without an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s to be similar. 10. It would also be pertinent to mention here that the High Court of Kerala in Collector of Central Excise and Custom, Cochin v. Premier Tyres Ltd. , 2001 (130) E.L.T. 417 (Ker.) following the judgment of the Apex Court answered a similar question in favour of the assessee and against the Department. 11. It would also be pertinent to mention that the judgment of the Tribunal in Ashok Iron and Steel Fabricators' case has been upheld by the High Court of Rajasthan in Hindustan Zinc Ltd. v. Union of India , 2008 (223) E.L.T. 149 (Raj.). The High Court held as follows:- "It can be seen from yet another angle. In case inputs are received in factory and used in manufacture of end product. But the end product is destr ..... X X X X Extracts X X X X X X X X Extracts X X X X
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