9911796707
TMI Blog2008 (9) TMI 698X X X X Extracts X X X X X X X X Extracts X X X X ..... s does not amount to manufacture; confirmed the demand of an amount of Rs. 1,65,45,396/- in terms of Rule 6(3)(b) of the Cenvat Credit Rules, 2004 along with interest and; imposed equivalent penalty of Rs. 1,65,45,396/-. 2. Heard both the sides and perused the records. 3. The applicants are, inter alia, engaged in the manufacture of different Bulk Drugs and Formulations falling under different sub-headings of Chapters 29 and 30 of the Central Excise Tariff Act, 1985. 4. The Applicants, inter alia, manufacture Rifampicin, Isoniazid, Pyrazinamide and Ethambutol. They import Dapasone BP Tablets and Clofazamine (Lamprene) BP capsules without payment of CVD under Notification No. 4/2006 dated 1-3-2006. 5. They sell Rifamp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ugs Sr. No. Products Chapter Sub-heading (i) Isoniazid 30049051 (ii) Rifampicin 30049052 (iii) Pyrazinamide and ethambutol 30049053 (iv) Streptomycin 30049054 (v) Dapsone (DDS), acednpsone (DADDS), solopsone and Clofazaimine 30049055 (vi) Chloroquine, amodiaquine, mefloquine, quinine, Chloroguamide, pyrimethamine 30049056 (vii) Other antitubercular drugs 30049057 (viii) Other antileprotic drugs 30049058 (ix) Other antimalarial drugs 30049059 8.1 The Applicants have classified the disputed products manufactured by them as follows : Sr. No. Products Chapter Sub-heading 1. M.B.Child, M.B.Adult, P.B.Child, P.B.Adult 30049058 2. Lamprene (Clofazimine) 30049058 3. Rimactane (Rifampicin) 30049057 4. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nbsp; cleared for export under bond in terms of the provisions of the Central Excise Rules, 2002. 12. The Commissioner has, in para 22 of the Order, held that the applicants are not maintaining the separate accounts for the inputs and input services as are required under Rule 6(2) of the Cenvat Credit Rules, 2004 and hence are reauired to pay an amount equal to 10 per cent under Rule 6(3) of the Cenvat Credit Rules, 2004. 13. It is the contention of the applicants that none of the goods held to be exempted by the Commissioner under Notification No. 4/06 dated 1-3-2006 are cleared by them for home consumption. According to them, these goods are cleared either for export or under Notification No. 108 of 1995. 14. The Commiss ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s, 2004. 18. Prima facie, it appears that the Order of the Commissioner is contrary to and inconsistent with the judgment of the Hon'ble Bombay High Court dated December 6, 2007 in Writ Petition No. 6951 of 2007 filed by M/s. Repro India Ltd. [2009 (235) E.L.T. 614 (Bom.)] in which it has been held as under : "8. The Cenvat credit is allowed on the duty paid on inputs to mitigate the effect of double taxation of levying duty on inputs as also on the final product. If, however, the exempted final product is exported it calls for a special relaxation/dispensation to make the goods of the country internationally competitive. As an illustration suppose a final product like tractor is otherwise exempted from excise duty even for dome ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the exported goods under Rule 6(3)(b) on the footing that the printed books are exempt and, therefore, attract Rule 6(1) would be incorrect and completely nullify and frustrate Rule 6(6)(v). 9...... A perusal of the aforesaid Rules would clearly show that sub-rule (i) to (vi) are identical and the difference in Rule 6(6) of the Cenvat Credit Rules, 2004 and 6(5) of the Cenvat Credit Rules, 2002 is not relevant for the purpose of the present case. Rule 6(1), 6(2), 6(3) and 6(4) of the Cenvat Credit Rules under Cenvat Credit Rules, 2002 as well as under Cenvat Credit Rules, 2004 remains the same. As noted earlier the object and purpose of Rule 6(6) of Cenvat Credit Rules, 2004 is to promote the policy of the Government that the benefit of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bility of the Modvat credit on the inputs used in the exempted products being exported, has held that the bar of Rule 57C and Rule 57CC will not be applicable in respect of exported products even though the same are otherwise exempt from duty. 20. Prima facie, it appears that the applicants are not required to pay an amount equal to 10% under Rule 6(3)(b) of the Cenvat Credit Rules, 2004 and appear to be entitled to the credit of the duty paid on inputs used in the goods, which have been held by the Commissioner to be exempted from duty under Notification No. 4/06 dated 1-3-2006, as these goods were for export. 21. The applicants have made out a strong case for the complete waiver of the pre-deposit of the amounts demanded. We, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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