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TMI Blog1992 (12) TMI 148X X X X Extracts X X X X X X X X Extracts X X X X ..... ir Products, Banmore, could avail full exemption on one product and modvat credit on the other product under Notification 175/86 simultaneously. 2. In brief, the facts of the case here are that the respondents M/s. Gwalior Air Products Ltd., Gwalior are engaged in the manufacture of oxygen gas and acetylene gas. They availed modvat credit on acetylene gas and exemption under Notification 175/86 on oxygen gas after filing due declaration for both. Although a show cause notice dated 3-4-1990 was issued to the assessee proposing to recover Rs. 39,226.18 towards duty payable on account of wrong availment of Notification 175/86 on the ground that the Notification 175/86 does not allow a manufacturer to avail simultaneously modvat credit for on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The assessee is manufacturer of oxygen gas and acetylene gas both specified final products of Notification 175/86. (iv) As per Notification 175/86 there can be only two types of manufacturers i.e. either credit can be availed or exemption can be availed not both. (v) The provisions of Notification a(i) (ii) are mutually exclusive provisions and thus both benefits cannot be taken simultaneously. (vi) Notification 175/86, is applicable in its totality. It is not possible that a manufacturer will avail full exemption on one article and modvat credit on the other article. 6. I am afraid I cannot agree with the above views. The matter here is already settled by the decision of the Hon. Tribunal in the case of Swaraj Paints In ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... so much of the duty of excise leviable thereon which is specified in the said schedule (read with any relevant notification issued under sub-rule (1) of Rule 8 of the said Rules and in force for the time being) as is equivalent to the amount calculated at the rate of 10% ad valorem: (ii) In any other case from the whole of the duty of excise leviable thereon: Provided that the aggregate value of clearances of the specified goods under sub-clause (ii) of this clause in respect of any one heading No. of the said Schedule, shall not exceed rupees fifteen lakhs. It is seen that the benefit of exemption in terms of this notification is available in respect of specified goods and where the manufacturer avails of the credit of duty paid on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iew of sub-clause (a)(i)of the Notification. In our view, taking into consideration the provision of the Modvat scheme Notification 175/86, there is no doubt that the concessions envisaged under these are in respect of finished goods cleared from a factory and which are chargeable to duty and the purpose of both these is to reduce the total impact of duty in respect of finished goods. Under the MODVAT Scheme in case a finished goods paid the duty to the extent paid on inputs and used for those finished goods, is given as credit for being utilised for payment of duty. Under Notification 175/86 the benefit is available to individual specified goods as set-out in the Notification and what is envisaged in sub-clause (a)(i) is that the benefit a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssary verification arid allow the appellants the benefit as claimed by them, in case their plea made before us is found to be correct. We clarify that in respect of a particular specified product if the appellants at any stage during a financial year availed of the MODVAT Credit, the provisions of sub-clause (a) (i) of the Notification 175/86 in respect of that commodity will get attracted. The provisions of sub-clause (a)(i) makes no distinction as to at what stage in a financial year manufacturer avails of the MODVAT Credit in respect of the specified goods. With these observations we allow the appellant s plea and remand the matter to the lower original authority as mentioned above. Accordingly the appeal is allowed by way of remand. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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