9911796707
TMI Blog1993 (11) TMI 164X X X X Extracts X X X X X X X X Extracts X X X X ..... ome inputs in respect of which Modvat credit had been taken and utilised were still available with the Respondents and the authorities have sought to recover the amount taken as Modvat credit in respect of the same. The learned Collector (Appeals) has held that Modvat credit had been correctly taken and utilised and there was no warrant in law to recover the amount from the Respondents notwithstanding the fact that Modvat facility was withdrawn in respect of inputs on which credit has been taken and were lying in stock. 2. Shri J.P. Gregory, the learned SDR pleaded that inasmuch as these inputs have not been used in or in relation to the manufacture of the final product, the question of taking Modvat credit or utilising the same could not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... are not used as contemplated under Rule 57F(1), duty on the inputs is payable in terms of Rule 57-I(2). (4) The case of M/s. Wipro Information Technology relied on by the Collector (Appeals) related to expunging of credit under Rule 56A, as the final product became exempted subsequently whereas the present case relate to demand of duty on inputs under Rule 57-I(2). The ratio of the above case is not therefore, applicable to the facts of the present case." 3. Shri C. Chidambaram, the learned Consultant for the Respondent relied on the decision of this Tribunal in the case of Sri Sarvaraya Sugar (Bottling Unit) Ltd. reported in 1992 (59) E.L.T. 125. He drew our attention to the finding of the Tribunal in para 6 of the order which is repro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion of credit was otherwise than set out under Rule 57F. There is no specific provision under Modvat Rules providing for recovery of Modvat Credit whereby if in respect of any particular commodity credit allowed is utilised under Rule 57F and facility of Modvat is withdrawn and the inputs received earlier to the date of withdrawal of the Modvat facility are still lying unutilised. There is no one-to-one correlation also provided for in respect of the inputs used and the finished product manufactured out of the same for the purpose of utilisation of Modvat Credit. It is not the case of the Department that input credit taken was not utilised for the specified finished product at the relevant time. In view of the above we hold that the credit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tioning or carrying out any other operation necessary for the manufacture of the final product or remove the same without payment of duty under bond for export, and return the same to his factory for further use in the manufacture of the final product, provided that the waste, if any arising in the course of such operation is also returned to the said factory. (b) for the purpose of manufacture of intermediate products and return the said intermediate products to his factory for further use in the manufacture of the final product or remove the same without payment of duty under bond for export, provided that the waste if any, arising in the course of manufacture of such intermediate product is also returned to the said factory." We obse ..... X X X X Extracts X X X X X X X X Extracts X X X X
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