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TMI Blog2019 (5) TMI 1479X X X X Extracts X X X X X X X X Extracts X X X X ..... result, Menthol Flakes & Menthol Crystals were exempted from the whole of the duty of Excise leviable thereon. The other final products manufactured by the appellant continued to be dutiable. As on 01.03.2008 appellant had 5040 kg. of Crude Menthol involving Cenvat Credit of Rs. 4,74,268/- in their stock and 98561 Kg. of goods in-process involving Cenvat Credit of Rs. 95,51,299/-. It appeared to Revenue that provisions of Sub-rule (3) of Rule 11 of Cenvat Credit Rules, 2004 would be applicable as on 01.03.2008 and as a result, appellant were not eligible to avail Cenvat Credit of Rs. 95,51,299/- involved in the goods in-process and balance Cenvat Credit would lapse. Further, appellant had cleared on 29.02.2008, a consignment of Menthol for export by paying Central Excise duty through debit of Cenvat to the tune of Rs. 7,68,608/-. The said consignment was returned on 07.03.2008. It appeared to Revenue that the Menthol cleared before 29.02.2008 became fully exempt from whole of the duty of Excise w.e.f. 01.03.2008 and the appellant was not eligible to avail Cenvat Credit of duty paid on 29.02.2008 in terms of provisions of Rule 16 of Central Excise Rules, 2002. Therefore, Cenvat Cre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... prohibit the utilization of the Cenvat credit available as on the date of exemption for payment of the duty on the dutiable final products, as in terms of Rule 3 (4) of the Cenvat Credit Rules, 2004, the Cenvat credit can be utilized for payment of any duty of excise on any final product. Needless to say, various Rules of the Cenvat Credit Rules, 2004, have to be read harmoniously and, therefore, Rule 11 (3) cannot be given an interpretation which is in-conflict with the provisions of Rule 3 (4). However, the Rule 11 (3) would be subject to the provisions of Rule 6 and in this regard we do not accept the appellant's plea that the provisions of Rule 6 (1) are not applicable. From a perusal of Rule 11 (3) as well as 11 (2) it is clear that these two sub-Rules of Rule 11 are also in accordance with the general principles of the Cenvat credit that no Cenvat credit would be admissible in respect of inputs or input services which have been used in or in relation to manufacture of the exempted final products. As observed by the Apex Court in its judgment in the case of CCE, Vadodara vs. Gujarat Narmada Fertilizers Co. Ltd. (supra) mentioned above, this principle is inbuilt in the very str ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in view our observations in this order. The penalty imposable shall be according to the re-quantified demand. The appeal stands disposed of as above." The impugned Order-in-Original emanates from the said Final Order dated 30.09.2014 passed by this Tribunal. 3. The ld. Original Authority through impugned order has confirmed the demand of Cenvat Credit of Rs. 1,07,94,175/- and directed the appellant to pay interest on the same. Further, the Original Authority has imposed equal penalty on the appellant under Rule 15 of Cenvat Credit Rules, 2004 read with Section 11 AC of the Central Excise Act, 1944. Aggrieved by the said order appellant is before this Tribunal. 4. Heard the ld. Counsel for the appellant. The ld. Counsel has made following submissions:- (A) Appellant through letter dated 28.03.2016 submitted that the exempted finished goods manufactured out of duty paid inputs were largely exported by them and therefore, Cenvat Credit availed on inputs cannot be denied to them under provisions of Clause (v) of Sub-rule (6) of Rule 6 of Cenvat Credit Rules, 2004. (B) All the documents required to examine exports by the appellant were submitted to the Original Authority for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dame order which was set aside by this Tribunal. 4. The ld. A.R. for Revenue has reiterated the contents of the impugned Order-in-Original. 5. Having considered the rival submissions from both the sides and on perusal of said Final Order of this Tribunal dated 30.09.2014 and record, it is very clear that the Original Authority has not taken into consideration all the evidences placed before him for arriving at the decision. He has decided the issue of Cenvat Credit on the basis of said report dated 18.02.2016 submitted by the Jurisdictional Assistant Commissioner without forwarding a copy of the same to the appellant and seeking their comments on the same. We find that the impugned order is passed in violation of principles of natural justice. Further, the Original Authority also did not give an opportunity to the appellant to produce whatever documents and records it needs for passing the lawful order and only made an observation that RG-1 in Original was not produced and therefore verification of finished goods cleared for export could not be undertaken. The said observation is an admission of Original Authority for non-compliance of directions of this Tribunal passed through ..... X X X X Extracts X X X X X X X X Extracts X X X X
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