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TMI Blog2015 (9) TMI 925X X X X Extracts X X X X X X X X Extracts X X X X ..... lling Mills (P) Ltd. (2011 (8) TMI 1093 - CESTAT CHENNAI) - The ratio of the High Court of Madras order [2014 (12) TMI 905 - MADRAS HIGH COURT] is squarely applicable to the present case as the appellant availed the credit on inputs when the final product was dutiable and there was no one to one correlation and the final product was exempted vide Notfn 23/2004-CE dt. 9.7.2004 and the sub-rule (3) of Rule 11 of CCR came into effect from 1.3.2007 onwards and cannot be applied retrospectively. - impugned order confirming the demand on credit already taken on inputs lying in stock when the finished goods i.e. computers became exempted on 9.7.2004 is liable to be set aside - Decided in favour of assessee. - Appeal No. E/131/2006 - Final Order No. 40551/2015 - Dated:- 18-3-2015 - R. Periasami, Member (T),J. For the Appellant : Mr Raghava Ramabadran, Advocate and Mr. Sai Prasanth, Adv. For the Respondent : Ms Indira Sisupal, AC (AR) ORDER The present appeal is against the Order-in-Appeal dt. 6.12.2005. 2. The brief facts of the case are that appellants are manufacturers of Retail Computer Systems, DOT Matrix Printers falling under Chapter Heading 84 85 and regis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pment Ltd. Vs CCE -2014-TIOL-2307-HC-MAD-CX 2. CCE Panchkula Vs HMT (TD) Ltd. 2010-TIOL-316-HC-P H-CX 3. CCE Vs TAFE Ltd. 2011 (268) ELT 49 (Kar.) 4. CCE Vs TAFE Ltd. Supreme Court Order dt.16.9.2011 in SLP No.14763/2011 5. Commissioner Vs Ashok Iron Steel Fabricators 2003 (156) ELT A212 (SC) 6. CCE Chandigarh Vs Kashmir Conductors 1997 (96) ELT 257 (T) 7. Madura Coats Vs CCE 1996 (82) ELT 512 (T) 4.1 He further placed reliance on the Hon'ble Supreme Court judgment in the case of Dai Ichi Karkaria - 1999 (112) ELT 353 (SC) wherein the Apex Court while dealing with the Central Excise Rules, 1944 held that there is no provision for reversal of credit except where credit is taken illegally or irregularly. 4.2. He submits that case law relied upon by Commissioner (Appeals) in the impugned order in the case of Albert David Ltd. Vs CCE [2003 (151) ELT 443 (T) as affirmed by the Apex Court [2003 (157 ELT A81(SC)] was clearly distinguished by the Hon'ble Madras High Court in their subsequent case in the case of Tractor and Farm Equipment Ltd. Vs CCE [2014-TIOL-2307-HC-MAD-CX] and same is not applicable to the facts of this case. 4.3 Ld. Advocate further ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ule 11 of CCR was inserted making specific provision where a manufacture is required to pay amount equal to the cenvat credit taken on inputs lying in stock if the final product became fully exempted. The Revenue relied on Tribunal's decisions in the case of Albert David Ltd. Vs CCE (supra) and Explicit Trading Marketing (P) Ltd. Vs Commissioner (supra). Both the decisions were upheld by Supreme Court. I am fully aware of the fact that this Tribunal Bench also upheld the reversal of credit in the case of CCE Vs M/s.Annapoorna Re-rolling Mills (P) Ltd. (supra) by relying above decisions. 9. However, it is relevant to see that the Hon'ble High Court of Madras in the case of Tractor and Farm Equipment Ltd. Vs CCE (supra) on identical issue examined the case in detail and distinguished the decisions of both M/s.Albert David Ltd. and M/s.Super Cassettes Industries Ltd. (supra) and held in favour of the appellant. The relevant paragraphs of High Court order is reproduced as under :- 14. In the instant case, assuming for the moment that the credit is available, it can be used for payment of duty on any other excisable articles and not exempted goods. In such view of the m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... supplied) 16. Once it is held that no co-relation between the raw material and the final product is required, the appellant's plea stands answered. If credit can be taken against excise duty on a final product manufactured on the very day, it makes it abundantly clear that there need not be co-relation between the input and the goods cleared and as a result, validly taken credit need not be reversed. The Central Excise Rules would come into play in the following manner, that is to say, on the date when the final goods become exempt from payment of duty, for the inputs received on and after the said date, no credit can be taken. This would be the correct method of understanding of the position of law. 17. The introduction of Rule 11(3) of the Cenvat Credit Rules, 2004, by Notification No.10/2007-CE (NT), dated 1.3.2007 and the Tax Research Unit Circular in D.O.F.No.334/1/2007-TRU, dated 28.2.2007 clarifying that it will come into effect immediately, makes it clear that the position of law as it stood decided in the assessee's own case by the Karnataka High Court, the appeal against which was dismissed by the Supreme Court, is the correct position. The Tribunal in this ..... X X X X Extracts X X X X X X X X Extracts X X X X
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