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TMI Blog1995 (8) TMI 149X X X X Extracts X X X X X X X X Extracts X X X X ..... under manufacture or which stood manufactured on the date when they opted out of the MODVAT Scheme and opted for the benefit of Notification 175/86. The learned lower authority in his findings has held as under : In the Appeal Memorandum, the appellants main contention is that there is no one to one co-relation in the usage of material and hence credit availed cannot be held as irregular and that there is no specific provision for demanding duty on the inputs held. Rule 57C specifies that no credit of the [specified] duty paid on the inputs used in the manufacture of a final product shall be allowed if the final product is exempt from the whole of duty of excise leviable thereon or is chargeable to Nil rate of duty. In this case, the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rder of the Asst. Collector and confirmed the duty demand and this has been paid by us. Our submissions here is that the view taken by the lower authorities is not correct and that at the time of opting out of MODVAT, demand of duty on the inputs is not intended in law and there is no provision for the same. We wish to bring on record a decision of the same Bench in a similar case relating to the same period, in the Appeal filed by M/s. Gangal Pharmaceuticals, Hubli, in Appeal No. E/161/92-MAS, decided on 11-5-1992". 2. We have considered the pleas made by both the sides. The short issue that falls for determination is whether on the day when the appellants opted for benefit of Notification 175/86 the MODVAT credit attributable to the i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (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 Chapter of the said Schedule, shall not exceed rupees twenty lakhs (w.e.f. 14-4-1990)." It is clear from this that in case the appellant have availed of the benefit of MODVAT credit in respect of the inputs, the benefit of Notification is restricted to a lesser amount. In the present case therefore since the appellants had availed of the MODVAT credit in respect of the inputs which were lying in stock and also which were contained in the semi-finished goods and finished goods on the day the appellants opted for the benefit of Noti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1(a)(i) of the Notification No. 175/86 as above. The other course open in case the authorities felt that on the assessees opting out of MODVAT they had to be allowed the benefit of free clearance under Notification 175/86, the authorities could have recovered the duty on the inputs which were lying in stock at the time when these are taken into use for manufacture of the finished goods for clearance free of duty in terms of Notification No. 175/86. Under Rule 57F the inputs on which the MODVAT credit has been taken on clearance for home consumption when the unit would not be functioning under the MODVAT scheme the same could be allowed clearance on payment of duty. This we have held in a number of cases. In the case of M/s. Pinakini Bevera ..... X X X X Extracts X X X X X X X X Extracts X X X X
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