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TMI Blog2006 (1) TMI 129X X X X Extracts X X X X X X X X Extracts X X X X ..... ty liability for cotton and polyester verieties of yarn, irrespective from which source the MODVAT credit was obtained. It is not permissible to fragment if so as to restrict it only to particular lines of production. Such an allocation of credit, raw material-wise or final product-wise is not permitted by the rule. Nor it is practicable. X X X X Extracts X X X X X X X X Extracts X X X X ..... h source the MODVAT credit was obtained. Under the impugned order, Commissioner has held that input credit accruing in regard to inputs for cotton yarn could be utilized only for discharge duty on the cotton yarn. Similar view has been taken in regard to polyester yarn also. The duty demands as mentioned in the impugned orders have been confirmed based on that view. 3. The contention of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ai Ichi Karkaria Ltd., reported in 1999 (112) E.L.T. 353 (S.C.). It is being pointed out that the Supreme Court observed, "the credit is, therefore, indefeasible". The Court further observed as under : "It should also be noted that there is no co-relation of the raw material and the final product; that is to say, it is not as if credit can be taken only on a final product that is manufactured out ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ourt and instructions of the Central Board of Excise and Customs. MODVAT credit account is indefeasible. It is not permissible to fragment if so as to restrict it only to particular lines of production. Such an allocation of credit, raw material-wise or final product-wise is not permitted by the rule. Nor it is practicable. 5. In view of what is stated above, appeals are allowed after sett ..... X X X X Extracts X X X X X X X X Extracts X X X X
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