9911796707
TMI Blog2006 (9) TMI 22X X X X Extracts X X X X X X X X Extracts X X X X ..... and imposing penalty. The facts of the case are as follows: The facts, in brief, of this case are that the Appellants are engaged in the manufacture of Bulk Drugs and Drug intermediates falling under Chapter Heading No. 2942 of the schedule to the Central Excise Tariff Act, 1985. The Appellants were taking Cenvat Credit on all the inputs received and utilized in the manufacture of finished products. Some of the inputs were common inputs used in the manufacture of dutiable final goods as well as non-dutiable or exempted final goods. However, some of the inputs were exclusively utilized in the manufacture of exempted final goods. It appeared that the Appellants had contravened the provisions of Sub-rule (1) of Rule 6 of Cenvat Credit Rules ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ith Section 11AB of Central Excise Act, 1944. 2. The learned Counsel submits that the very issue has been decided in assessee's favour in their own case in terms of the Final Order Nos. 572-576/ 2005 dated 7.4.2005; Final Order Nos. 874-875/2006 dated 21.4.2006 [reported in 2006(76) RLT81O (CESTAT-Ban.)] and Final Order Nos. 1961-1962/2005 dated 10.10.2005. He produces a copy of these orders. He submits in terms of these order, they are not required to reverse the credit and demands are therefore not sustainable. 3. The learned JDR reiterates the Departmental view. 4. On a careful consideration, we notice from the Final Order Nos. 572-576/ 2005 dated 7.4.2005, the Tribunal in Paras 6-7 has held as follows: 6. We find that Rule ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... isfied if credit is not availed (using the expression loosely) on inputs used in the exempted product. Since the expression used is specific and clear; it is evident that the legislature wanted to make it clear that Rule 57C (1) can be treated as complied with if and only if the requirement of Rule 57CC (1) is fulfilled by the specified category of manufacturer. That is why the expression "only when" and not merely the word "when" is employed in the latter portion of Rule 57C (2). It is therefore, clear that once an assessee manufactures dutiable and exempted final products and takes credit of all the inputs and pays an amount of 8% as required under Rule 57CC (1), he would be deemed to have complied with the requirement of Rule 57C (1) and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dit of specified duty on any inputs used in the exempted as well as dutiable final product For such category of manufacturer, the obligation imposed by the rule was payment of an amount @ 8%. The expression " the manufacturer takes credit of specified duty on any input.., which is used or ordinarily used in or in relation to the manufacture of both the aforesaid categories of final products Was descriptive of the type of manufacturer covered by Rule 57CC (1). Payment of 8% had no nexus or bearing with the credit take on the so- called exclusive inputs. There was nothing in Rule 57CC (1) to indicate that 8% paid was to be accounted for or treated as credit attributable to the exclusive inputs. In fact, the reference to common inputs has been ..... X X X X Extracts X X X X X X X X Extracts X X X X
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