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TMI Blog2017 (1) TMI 1315X X X X Extracts X X X X X X X X Extracts X X X X ..... passed. Such order does not provide any scope to appreciate that the appellant carried out manufacture of the exempted goods during the material period only using the input in question - In absence of any evidence to show that the appellant has not used the input commonly with others for manufacture of exempted goods as well as dutiable goods, proposition of the appellant that 8% demand on the va ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... der a Notification. Both goods were manufactured for Defence Department making exclusive use of an input. Revenue disentitled the appellant to the MODVAT credit. However appellant has paid 8% of the value of the exempted goods to resolve the dispute on an allowance of MODVAT Credit. Therefore, there should not be any direction for reversal of the MODVAT credit. 2. Appellant further submitted ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or manufacture of exempted goods. 4. Learned AR also says that the appellant was before Settlement Commission and withdrew its application. To this proposition, appellant replies that Settlement Commission did not look into the merits of the case at all. However, settlement petition was rejected when the quantum of deposit for settlement was disagreed between the parties. 6. Heard both sid ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... into, nothing is apparent from the adjudication order to appreciate that the authority made any trial run to find out that the input in question was the only input used to manufacture goods meant for Indian Navy. Appellant says this input was commonly used along with other inputs for manufacture of exempted goods and other finished goods. Had there been any trial run to ascertain that the finishe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d to the issue, which is running for the last 15 years, the appellant can only be directed to deposit 8% of the amount of the value of the goods cleared with interest if any, for the default amount to bring an end to the issue. 10. In view of the dispute between the parties as above on the point of law, there shall be no penalty. 11. In the result, appeal is allowed to the above extent. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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