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TMI Blog2004 (8) TMI 518X X X X Extracts X X X X X X X X Extracts X X X X ..... ents, it was noticed that they have carried forward the unutilised credit lying in their RG 23A part II account to the extent of Rs. 4,06,594.00/- and have also taken fresh credits to the extent of Rs. 4,49,773.44 during the period from 1-4-1999 to 30-9-1999. The assessee-respondents were clearing their final products without payment of duty in terms of Notification No. 75/87, dated 1-3-1987. Rule 57C prescribed that the credit of duty shall not be allowed if the final product is exempted from payment of duty. It was in these circumstances that show cause notice was issued to the assessee-respondents and the show cause notice culminated in the order of adjudication passed by the Deputy Commissioner whereby he has confirmed the duty demand of Rs. 8,56,368/- apart from imposing penalty of Rs. 1,00,000/- under Rule 173Q of the C.E. Rules, 1944. He has also demanded interest under Section 11AB, and also rejected their refund claim for Rs. 3,53,075.22 under Section 11B of the C.E. Act, 1944. Aggrieved by the said order, the party filed appeal before the Commissioner (Appeals) who by the impugned order has held that the refund claim should not have been rejected. He has also directed th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s which are exempted from payment of duty, in terms of Rule 57C, they are not entitled to take any credit. In terms of Rule 57H(7), the balance of credit if any lying in balance shall lapse and shall not be allowed for payment of duty on any excisable goods whether cleared for home consumption or for export. Therefore, the transfer of unutilised credit of the previous financial year to the next financial year was not correct. She, therefore, prayed for setting aside the impugned order and allowing the appeal. 4. Heard Shri K. Ramachandran, learned Counsel for the respondent. He has pleaded that the impugned order is a reasoned order. He has also pleaded that the assessee-respondents have restricted their claim only to the duty paid on the inputs which have been used in the manufacture of the final products exported. He has further pleaded that the assessee-respondents are entitled to refund of the amount claimed in terms of Rule 57F(13). He has prayed for rejection of the Revenue appeal. He has also invited my attention to the Larger Bench decision in the case of Hotline Teletubes Components Ltd. v. CCE, Bhopal reported in 2001 (131) E.L.T. 300 (Tri. - LB) wherein in similar ci ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed in the manufacture of the final products exported out of the country under bond. From the impugned order, I find that the Commissioner (Appeals) has not discussed in detail about the lapsing of the credit except stating that in the case of the appellants, there is no such provision to lapse the credit under Notification No. 10/99 in terms of which the assessee availed exemption from duty whereas in the issue on hand, the Notification under consideration is Notification No. 75/87-C.E., dated 1-3-1987 and not Notification No. 10/99-C.E., dated 28-2-1999 as amended and effective up to 31-3-2000. However, for this discrepancy, I am not inclined to remand the matter to the Commissioner (Appeals) as all the materials are available before me to decide the issue. I have perused Notification No. 75/87, dated 1-3-1987 which is a specific exemption Notification based on the value or quantity of clearances in a financial year, in respect of the goods cleared for home consumption and not for export under bond. I have also perused Rule 57H(7) which has been heavily relied upon by the Revenue in support of their plea to deny the benefit of Modvat credit and refund. This Rule reads as under : ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for refund of duty in respect of the duty paid on the inputs which have been used in the manufacture of the final products exported. The plea of the appellants is that they are entitled to refund of the said duty in terms of Rule 57F(13). The said rule is reproduced below for convenience of reference : Where any inputs are used in the final products which are cleared for export under bond or used in the intermediate products cleared for export in accordance with sub-rule (4), the credit of specified duty in respect of the input so used shall be allowed to be utilised by the manufacturer towards payment of duty of excise on any final products cleared for home consumption or for export on payment of duty and where for any reason such adjustment is not possible, the manufacturer shall be allowed to refund of such amount subject to safeguards, conditions and limitations as may be specified by the Central Govt. by Notification in the Official Gazette 7.1 I observe that this very question has been addressed by the Larger Bench in the case of Hotline Teletubes Components Ltd. v. Commissioner, Bhopal reported in 2001 (131) E.L.T. 300 wherein the Larger Bench has held as under : ..... 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