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TMI Blog2003 (8) TMI 62X X X X Extracts X X X X X X X X Extracts X X X X ..... er Chapter Heading 87.08 of the Central Excise Tariff Act, 1985. It took credit on inputs i.e. Angles and M.S. Flats during the period from April, 1987 the July, 1987 under Government of India Ministry of Finance Order F. No. B22/5/87-TRU, dated 7-4-1986. The Assistant Commissioner issued notice to Respondent No. 1 proposing to recover the Modvat credit availed by it. After considering its reply, the adjudicating authority confirmed the proposal vide its order dated 6-9-1988. The Collector (Appeals) accepted the appeal filed by Respondent No. 1 and quashed order dated 6-9-1988. Customs, Excise and Gold (Control) Appellate Tribunal, New Delhi (for short, 'the Tribunal') upheld the order of the Collector (Appeals) and dismissed the appeal fil ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on by the learned Counsel for the parties. 6.In Upper India Steel Manufacturing and Engineering Co. Ltd. case (supra), a Division Bench of this Court approved the view taken by the learned Single Judge that the burden to establish the conditions specified in Government of India's order dated 7-4-1986 was on the manufacturer. The Division Bench rejected the argument that the benefit of deemed Modvat credit is admissible to the manufacturer on the inputs and it was for the department to show that inputs used in the manufacturing of the final products fell within the scope of the exceptions. 7.In Collector of Central Excise, Chandigarh v. M/s. Decent Dyeing Co. (supra), the Supreme Court considered the question as to whether the onus to pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (S.C.), the Supreme Court dealt with the case of a notification granting exemption of so much of the duty as is in excess of the duty on base yarn if not already paid plus Rupees ten per Kg. The assessee had disclosed the names of traders from whom he made the purchases of base yarn and names of manufacturers and also enclosed copies of relevant record. The Revenue did not verify the facts and proceeded on the basis that it was for the assessee to prove actual payment of base yarn duty. The Supreme Court held this was not a proper approach. It was not as if the assessee alone should have special knowledge of the fact of payment of duty. It was therefore for the Revenue to prove non-payment. This principle has been followed by the Tribunal i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... plained by the appellate Division Bench of the Court in the judgment reported in 1995 (75) E.L.T. 735 (P H) in the following words :- "The grievance of the appellant is that the learned single judge has placed the burden on the manufacturers is totally misconceived. According to the learned single judge, the manufacturer has to take a definite stand. We find that the view taken by the learned single judge is wholly unexceptionable." (Emphasis supplied) The Punjab and Haryana High Court was not, in the above case, dealing with a notification exempting goods from excise duty subject to conditions. A manufacturer who seeks the benefit of the Government order issued under proviso to Rule 57G(2) must naturally say so, that is, take def ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ocumentary evidence to show that the reduced duty has been paid and it is for the assessee to produce the documents and prove the positive fact required to be proved. But basically it is for the person who sets up an exception to prove it. The mere existence of an exemption notification is not sufficient to show that the inputs is wholly exempt from duty or clearly recognised as not being duty paid or charged to nil rate of duty. This consequence may automatically follow in the case of unconditional exemption once it is shown that the inputs in question are attracted by the notification. In the case of conditional exemption, unless it is shown that all the conditions are satisfied in a given case, it cannot be stated with certainty that t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xempted from duty, they are not duty paid and hence no credit is admissible. Credit of duty paid not on inputs of the assessee but on raw materials by using being which the inputs are manufactured may be admissible to the manufacturer of inputs. No credit can be enjoyed by the user of the inputs, of duty not paid on the inputs, but on the raw materials of the inputs. Duty paid on the raw materials of inputs cannot be credited to the account of purchaser of the inputs. Assessee in these cases cannot seek credit for duty paid not on their inputs but on raw materials for the inputs. Payment of duty, down the line at some earlier stage cannot go to the benefit of the assessee." 9.In our opinion, the law laid down by the Supreme Court in Colle ..... X X X X Extracts X X X X X X X X Extracts X X X X
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