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TMI Blog1999 (8) TMI 691X X X X Extracts X X X X X X X X Extracts X X X X ..... er sub-heading No. 7221 without payment of duty under CT-2 certificates to M/s. Raj Ratan Steel Industry, Kalol and M/s. REI Industries, Bhiwadi, Rajasthan. The appellants were availing Modvat credit of duty paid on inputs used for the manufacture of said goods under Rule 57A of the Central Excise Rules, 1944. It was contended by the officers that when the appellants were clearing SS wire rods without payment of duty under CT-2 certificates, they were required to debit an amount equally to 8% of the price of the said goods so cleared without payment of duty from the factory in terms of provisions of Rule 57CC of Central Excise Rules, 1944. It was noticed that the appellants were not debiting the said amount at the time of clearance of the said goods from the factory. The SCN was therefore issued proposing to recover the aforesaid amount of Rs. 71,75,250/- and to impose penalty. The Assistant Commissioner under the impugned order has confirmed the said demand of duty and also imposed penalty as mentioned above. 4. The appellants in their appeal memorendum mainly submitted as under :- 1. That the Assistant Commissioner has erred in interpreting the two judgements namely (1) Or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... de by the appellants in their appeal memorandum and also submission made during the course of personal hearing. The issue involved in this case is whether the provision of Rule 57CC of Central Excise Rules, 1944 is applicable when goods are cleared under CT-2 certificate for use in the manufacture of excisable goods meant for export under Rule 13 of Central Excise Rules, 1944 or not. 7. It is observed from the case records that the appellant had cleared S.S. Wire Rods to M/s. Raj Ratan Metal Industries, Kalol (N.G.) and M/s. KEI Industries, Bhiwadi, Rajasthan without payment of duty on the strength of CT-2 certificates issued in terms of provisions of Rule 13 of Central Excise Rules, 1944 read with Notification No. 47/94-C.E. (NT), dated 22-9-1994. The Assistant Commissioner under the impugned order has held that the appellants were availing Modvat credit of duty paid on the inputs used in the manufacture of the aforesaid goods and since the said goods were cleared under CT-2 certificate, the appellants were required to debit an amount equal to 8% of the value of the goods so cleared without payment of duty under Rule 57C read with Rule 57CC of Central Excise Rules, 1944. It ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e instant case is as per Chapter X procedure. The heading of Chapter X itself mentions "remission of duty on goods used for special industrial purposes". Thus, in case of clearances made under Chapter X procedure the duty is required to be remitted only on following conditions stipulated under Chapter X and also the notification. In case the stipulated conditions are not fulfilled, the duty leviable on the subject goods is liable to be realised in terms of Rule 196 of Central Excise Rules, 1944. Thus, the provisions of exemption from duty as well as remission of duty are entirely different and cannot be equated. As per the ruling of the Hon'ble Supreme Court in case of Indian Aluminium Cables Ltd. v. State of Haryana (1976) 38 STC 108 at PPS111, 112 (S.C), the general exemption means that the goods should be totally exempt from tax before similar exemption from the levy of Central Sales Tax can become available. Where, the exemption from taxation is conferred by conditions or in certain circumstances, there is no exemption from tax generally. 12. Rule 57C stipulates that credit of duty not to be allowed if final products are exempt or the item chargeable to nil rate of duty. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of sub-rule (2) of Rule 56A which made proforma credit inapplicable in cases where the finished product are either exempted from the whole of duty or are chargeable to nil rate of duty. Para 6 of the letter F. No. 211/D2/73-CX 6, dated 3-4-1975 (Circular No. 10/75-CX6) issued by the Ministry is extracted below :- "6. The first point viz. whether the goods manufactured under Rule 56A ibid and exported in bond could be treated as exempted from payment of duty or chargeable to nil rate of duty was referred to the Ministry of Law who have advised that the goods exported in bond in such cases cannot be treated either as exempted from payment of duty or chargeable to nil rate of duty. Consequently, the provisions of clause (i) of the first proviso to sub-rule (2) of Rule 57A ibid would not apply to those cases where finished excisable goods are exported in bond. An extract of the advice of the Ministry of Law, Justice and Company Affairs is appended." 15. The provisions so interpreted is similar to Rule 57C with which we are concerned and the instruction will apply equally well to the present case. 16. It is also pertinent to mention that the Government of India has issued N ..... X X X X Extracts X X X X X X X X Extracts X X X X
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