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TMI Blog2013 (11) TMI 1384X X X X Extracts X X X X X X X X Extracts X X X X ..... ow cause notice cannot invoke Rule 6(3) of Cenvat Credit Rules and demand an amount to 10% equal to the sale value of the exempted final products. The Rules 6(2) & 6(3) would not apply when some exempted final products emerge as inevitable and unavoidable waste or by-product, as in such a situation, even if the manufacturer wants, he cannot maintain separate account and inventory - Rule 6(2) and 6(3) cannot be construed to impose an obligation on a manufacturer which is imposable to observe and then go on penalise him, by the demands under Rule 6(3) and imposition of penalty – Relying upon RALLIS INDIA LTD. Versus UNION OF INDIA [2008 (12) TMI 46 - HIGH COURT BOMBAY] - Rule 57 CC of Central Excise Rules, 1944 (which is pari materia with ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... exempted final product have not been maintained as per provisions of the Rule 6(2) so that the cenvat credit is taken only in respect of those inputs or input services which are used for manufacture of dutiable final products, the provisions of sub-rule (3) of Rule 6 of Cenvat Credit Rules, 2004 would be attracted and in respect of clearance of iron ore fines or coal fines, an amount equal to 10% of the sale value would be payable. On this basis, separate show cause notice for demand of an amount of Rs.2,58,481/- in respect of clearances of iron ore fines for a demand of an amount of Rs.2,78,119 in respect of clearance of coal fines along interest and imposition of penalty were issued. These show cause notices were adjudicated by two separa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s been availed are used in or in relation to the manufacture of dutiable as well as exempted final products and the manufacturer has not maintained separate account and inventory of the inputs/input services meant for dutiable and exempted final products and confined the cenvat credit availment only to input and input services meant for dutiable final products. In these two cases, ongoing through the show cause notices, I find that nowhere in the show cause notices, it is mentioned as to which are the common input or input services in respect of which cenvat credit has been availed and which had been used in or in relation to the manufacture of dutiable and exempted final products. Unless the common inputs and or input services, in respect ..... X X X X Extracts X X X X X X X X Extracts X X X X
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