TMI Blog2001 (8) TMI 178X X X X Extracts X X X X X X X X Extracts X X X X ..... cts. Where the final products are exempted the credit is not allowed. It may happen that some inputs may be used in the manufacture of final products some of which are dutiable and the others are not dutiable. In that situation Rule 57C requires that the inadmissible portion of the credit should be written back. Some manufacturers find it difficult to maintain elaborate accounts of duty paid input ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ordinarily used in or in relation to the manufacture of both the aforesaid categories of final products, whether directly or indirectly and whether contained in the said final products or not, the manufacturer shall, unless the provisions of sub-rule (9) are complied with, pay an amount equal to eight per cent of the price of the second category of final products charged by the manufacturer for th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... time to time by issue of invoices under Rule 258/173G. The show cause notice was issued on 23-5-1998. The charge in the show cause notice was that the practice adopted by the present appellant was in contravention of Rule 57CC. The specific averment in the show cause notice reads as under : "However, M/s. Mayur Colours Ltd., D-2/2 Tarapur MIDC have transfered on reversal of proportionate duty o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... also) that the assessee were maintaining separate accounts of such inputs. He, however, observed that sub-rule (9) reproduced above required not only maintenance of separate accounts but also required "separate inventory". He termed this as non-compliance with the spirit of sub-rule (9). 4. The Commissioner (Appeals) after taking cognizance of two judgments of the Supreme Court which enabled suc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ut would be engaged at all times in physically shifting the goods as per this interpretation. On perusal of the records I am satisfied that the present practice adopted by the appellant was valid in terms of sub-rule (9) of the Rule 57CC and therefore the demands confirmed against the appellant and the penalty imposed do not survive. 6. The appeal is accordingly allowed with consequential relief ..... X X X X Extracts X X X X X X X X Extracts X X X X
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