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TMI Blog2013 (2) TMI 31X X X X Extracts X X X X X X X X Extracts X X X X ..... and decide the issue by invoking the provisions relating to the removal of inputs, without determining as to how the impugned goods qualified to be the inputs? 2. Briefly stated facts are as under. 2.1) Respondent assessee is engaged in the manufacturing activity of an item called "P.D. Pumps". On purchase of such pumps, the respondents availed of modvat credit under rule 57A of the Central Excise Rules, 1944. Revenue however, was of the opinion that the respondent did not carry out any manufacturing activity on the PD pumps purchased exclusively from its sister concern before clearance. The respondent was therefore, required to reverse such credit. 2.2) A show cause notice on this basis was issued on 18.10.1994 why the credit taken shou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eals and reversed the orders passed by the Revenue Authorities. The Tribunal held as under: "5. The Department's contention that the appellants did not file a declaration under Rule 57G is not correct. We have perused the declaration filed by the appellants. They have clearly declared their inputs and outputs as P.D. pumps. Further, the Tribunal in the case of Rico Auto Industries Ltd. Vs. CCE. New Delhi III[2003(57)RLT 271] held that when inputs are subjected to certain processed and the processed inputs were cleared on payment of duty which was more than the credit taken, modvat credit cannot be denied on the ground that the processes undertaken did not amount to manufacture. The ratio of this decision applies to the present case. Ti is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... F. Manner of utilisation of the inputs and the credit allowed in respect of duty paid thereon.- (1) The inputs in respect of which a credit of duty has been allowed under rule 57A may- (i) be used in, or in relation to, the manufacture of final products for which such inputs have been brought into the factory; or (ii) shall be removed, after intimating the Assistant Collector of Central Excise having jurisdiction over factory and obtaining a dated acknowledgment of the same, from the factory for home consumption or for export under bond, as if such inputs have been manufactured in the said factory. Provided that where the inputs are removed from the factory for home consumption on payment of duty of excise, such duty of excise shall in n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nufacture. 10.We are informed that such decision of the Tribunal in case of Rico Auto Industries Ltd. (supra) was carried in appeal before the Punjab and Haryana High Court. Appeal was disposed of remanding the proceedings for fresh consideration before the Tribunal. In the second round, the Tribunal once again ruled in favour of the assessee which decision is reported in 2007(210) ELT 583 (Tri-Del) in case of RICO Auto Industries Ltd. v. Commissioner of C.Ex., New Delhi. The Tribunal observed as under: "7. Apart from the fact that the assessee had satisfactorily established the nature of manufacturing processes to which these two items had undergone before they were removed on payment of excise duty on the value added basis, it is also n ..... X X X X Extracts X X X X X X X X Extracts X X X X
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