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TMI Blog2000 (1) TMI 76X X X X Extracts X X X X X X X X Extracts X X X X ..... ey however, did not utilise these inputs in the manufacture of electric fans and removed such inputs as such without any processing. On removal of the inputs, they paid central excise duty equivalent to the Modvat credit taken by them on receipt of the said inputs. During the relevant time the inputs could only be removed for home consumption on payment of appropriate duty of excise as if such inputs had been manufactured by the assessee receiving them, as per provisions of Rule 57F of the Central Excise Rules, 1944 (hereinafter referred to as the 'Rules'). The Asstt. Collector of Central Excise in his adjudication order dated 24-12-1991 referred to the provisions of Rule 57F of the Rules and observed that the inputs removed as such were de ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ory; or be removed, subject to the prior permission of the(ii) Collector of Central Excise, from the factory for home consumption or for export on payment of appropriate duty of excise or for export under bond, as if such inputs have been manufactured in the said factory : Provided that where the inputs are removed from the factory for home consumption on payment of duty of excise, such duty of excise shall in no case be less than the amount of credit that has been allowed in respect of such inputs under Rule 57A." 4.It is seen that under Rule 57F of the Rules, the inputs in respect of which the credit of duty had been allowed under Rule 57A of the Rules could be removed subject to the prior permission of the Collector of Central Ex ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... emoval of the inputs for home consumption as such could it may happen, be lower than the amount of credit; but in such an eventuality the amount of duty payable would be the amount of credit. 5.The expression used in Rule 57F(1)(ii) of the Rules was the 'appropriate duty of excise'. The appropriate duty of excise is the duty of excise as applicable to the excisable goods when they are removed from the place at which the duty liability is attracted. In the case of removals under Rule 57 F the time and place for payment of duty was when the inputs were removed from the factory in which they were received under Rule 57A of the Rules. 6.Under the provisions of Rule 57F of the Rules a legal fiction had been created that when the inputs in r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rtinent to note that vide Notification No. 28/95-C.E. (N.T.) dated 29-6-1995, the provisions were changed as under :- "Provided that where the inputs are removed from the factory for home consumption on payment of duty of excise such duty of excise shall be the amount of credit that has been availed in respect of such inputs under Rule 57A". This change makes it clear that prior to 29-6-1995, duty of excise applicable to the inputs removed as such without use in the manufacture of final products, for which purpose they had been brought, was not the amount of credit taken in respect of such goods but the amount of duty payable as if such inputs have been manufactured in the said factory as applicable on the date of removal from the rece ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nputs" and then it had been viewed as under :- "Therefore, 'appropriate duty of excise' has to be taken as the rate of duty which he suffered at the first instance and it cannot be read to mean 'effective rate of duty' as prevalent at the time of clearance of inputs for home consumption." This view does not flow from the observations extracted above." 12.After giving our careful consideration to the legal provisions and the facts on record, we do not agree with the view taken by the Collector of Central Excise (Appeals), Chandigarh. We set aside the same and restore the Order-in-Original passed by the Asstt. Collector of Central Excise. As a result, the appeal filed by the Revenue is allowed. Ordered accordingly. - - TaxTMI - TMI ..... X X X X Extracts X X X X X X X X Extracts X X X X
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