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TMI Blog2013 (2) TMI 142X X X X Extracts X X X X X X X X Extracts X X X X ..... nion of India (2011 (2) TMI 575 - GUJARAT HIGH COURT) it is held that as on the date of the adjudication order and on the date of filing the appeal too, Section 73(2) itself was not available and that it was amended under the Finance Act, 2010 only during the pendency of the appeal. Thus, with the bona fide prosecution of the appeal no justifiable ground to accept the stand taken by the Revenue that in the absence of compliance of the conditions in Section 73(2) of the Finance Act, 2010 within the six months' period, the claim of the assessee has to fail. The question of such a compliance as on the date of adjudication or filing of the appeal not being there, when the Tribunal felt, on facts, that it was necessary to remand the matter back to the Adjudicating Authority. Thus, we have no hesitation in confirming the order of remand restoring the matter back to the Adjudicating Authority to consider the claim of the assessee. Direct the assessee to produce necessary evidence in the form of certificate from a Chartered Accountant or a Cost Accountant for the relevant period, certifying the amount of input credit attributable to the inputs used in or in relation to the manufacture of f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... en taken. In the context of Rule 6 of the CENVAT Credit Rules, 2004, particularly Sub.Rule (2), requiring an assessee/manufacturer to maintain separate accounts in respect of exempted goods and dutiable goods for the purpose of working out CENVAT credit on the inputs used, a show cause notice was issued, calling upon the respondent to indicate whether it had opted for maintaining separate accounts for exempted and dutiable final products, failing which, the manufacturer would have to pay 10% of the total price of the exempted goods at the time of clearance from the factory. 3. The Adjudicating Authority pointed out that the assessee had not maintained separate accounts and hence, in these circumstances, proceedings were initiated to recover duty in terms of Rule 14 of the CENVAT Credit Rules, 2004 read with Section 11A(1) of the Central Excise Act, 1944. 4. The assessee pointed out through a statement that they had not taken any CENVAT credit in the months of January and February, 2008 on furnace oil used in respect of exempted goods. It also produced flow meter readings. Apart from that, it contended that it maintained separate accounts. The assessee further pointed out th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Bill, 2010 receives the assent of the President. Thus, the six months' period expired on 7.11.2010. Hence, on the admitted fact that the respondent had not filed any such option with necessary documents within the said period, the claim could not be considered. He further contended that the findings of the Tribunal that the respondent had not taken any CENVAT credit for the period January and February 2008 and for the month of March 2008, the respondent reversed the proportionate credit, are perverse findings, not based on any material. 7. Countering the said claim, learned counsel for the assessee pointed out through the reply to the notice issued by the Adjudicating Authority, which was extracted in the adjudication order, that the specific case of the assessee was that it did not claim any CENVAT credit on the inputs used in the manufacture of exempted goods for the months of January and February 2008 and that for the month of March 2008, it had reversed the entry. In the circumstances, in the absence of any material at the hands of the Revenue, the finding could not be called perverse. The only question that was considered by the Adjudicating Authority at the time of adjudi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... owever, reversed it thereafter. In the background of the said claim, the Tribunal thought it fit to remand the matter back, directing the Adjudicating Authority to find out as to whether the formula provided for has been properly applied in this case. Ultimately, if the assessee is to have the benefit of no liability, it has to follow the formula provided for under Rule 6(3A) of the CENVAT Credit Rules. 11. Thus, the question that has to be considered is as to whether the reversal of the credit for the month of March 2008 was taken on the basis of the formula provided for and in accordance with Section 73(2) of the Finance Act, 2010. In the decision reported in 2011 (267) E.L.T. 153 (cited supra), the Gujarat High Court considered a similar situation. There printing ink was used in the manufacture of dutiable plastic material and exempted labels and separate account under Rule 57C of the Rules was not maintained. The Gujarat High Court observed as follows: "8. Rule 57C of the Rules laid down that no credit of the specified duty paid on the inputs used in the manufacture of a final product shall be allowed if the final product is exempt from the whole of the duty of excise lev ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of goods. Such assessees would have to make an application for the same within six months of the enactment of the Bill along with documentary evidence and a certificate from a Chartered Accountant or a Cost Accountant certifying the amount of input credit certifying the amount of input credit attributable to the inputs used in or in relation to the manufacture of final products which are exempted from the whole of the duty or chargeable to Nil rate of duty, within a period of six months from the date on which the Finance Bill, 2010 receives the assent of the President. The Finance Bill, 2010 has received the assent of the President on May 2010. Admittedly, the assessee did not make the application on account of the pending proceedings before the Court. Thus, considering the said fact, the High Court pointed out to the contention of the assessee that they were not required to make any such application on account of the reversal of the credit already taken and held that considering the amended Rule as to the availability of the benefit as contemplated under Section 69 of the Finance Act taking care of such situation and the fact that the amendment came during the pendency of the app ..... X X X X Extracts X X X X X X X X Extracts X X X X
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