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TMI Blog2011 (5) TMI 312X X X X Extracts X X X X X X X X Extracts X X X X ..... deemed MODVAT Credit, the same is for various other items/inputs which have gone into the manufacture of grey fabrics which were exempted during the relevant period and were being cleared by the manufacturer without payment of duty - Having observed that expression or unprocessed fabris were appearing in Para 4 of the notification subsequently issued for a limited period, which is not involved in the present appeal, hence the availment of actual duty paid on the grey fabrics in terms of provisions of Rule 3 and simultaneous availment of deemed MODVAT Credit in respect of specified goods mentioned in notification in question cannot be faulted upon - Decided in favour of assessee. - E/1412/2006 - - - Dated:- 6-5-2011 - Mrs. Archana Wadhw ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... availing MODVAT Credit of actual duty paid on the grey fabrics received by them during the period 1.3.01 to 27.2.02. They, accordingly, took the credit of Rs.1,18,66,416/- (Rupees One Crore, Eighteen Lakhs, Sixty Six Thousands, Four Hundred and Sixteen only) on 27.2.02. In respect of un-processed Denim fabrics, the assessee availed MODVAT Credit of duty actually paid on the said fabrics at the time of their clearance from 100% EOUs, vide their letter dt.25.2.02 addressed to Range Supdtt., they intimated that through inadvertence they have failed to take deemed credit on the said processed fabrics cleared by them in terms of Notification No.7/2001-CE(NT), and No.53/2001-CE(NT), which provides for availing of deemed MODVAT Credit at cert ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ase of M/s S. Kumar Ltd. Vs. CCE Indore as reported in 2002 (148) ELT 394. However, as the appellant had not utilized the disputed credit and had subsequently reversed the same, he set aside the interest and penalty on the same. The said part of the Commissioner(Appeals) s order stand accepted by the assessee and there is no appeal against the same. 4. In respect of the subsequent availment of CENVAT Credit of actual duty paid on the cotton fabrics to the tune of Rs.1,18,66,416/- (Rupees One Crore, Eighteen Lakhs, Sixty Six Thousands, Four Hundred and Sixteen only), he allowed the appeal on the ground that there is no prohibition or embargo cited under the rule or in terms of notification in question to simultaneous availment of deemed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t duty paid on the inputs of the exempted grey fabrics will be offset when paying duty on the processed fabrics. Logically, this should not prevent MODVAT Credit being availed on various other products which are the inputs for the manufacture of processed fabric; including capital goods and other inputs. In the light of this understanding of the legal position, we need to read the provisions of the two concerned notifications, Notification No.7/2001-CE(NT) dt.1.3.01 and No.53/2001-CE(NT), dt.29.6.01. 6. Notification No.7/2001-CE(NT) grants deemed credit to processed fabrics for inputs which are yarn, dyes, chemicals and packaging materials. The point of deemed credit is that duty paying documents are not available, therefore regular cre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... no doubt that in accordance with the wording of this Notification, credit on deemed basis under Notification No.53/2001-CE(NT) and regular CENVAT Credit can be allowed simultaneously. 8. It is also seen that the said Notification No.53/2001 was superseded by subsequent notification No.6/2002. The relevant Para 4 of the subsequent notification was as follows: 4. The provisions of this notification shall not apply to a manufacturer (other than a composite mill) who avails any credit, under Rule 3 of CENVAT Credit Rules, 2002, in respect of the declared inputs or unprocessed fabrics which are used in the manufacture of the said final products. 9. When we compare above paragraph with Para 4 of earlier notification, we find that de-b ..... X X X X Extracts X X X X X X X X Extracts X X X X
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