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2008 (223) E.L.T. 302 (Tri.-Bom) [05-11-2007]
2008 (223) E.L.T. 302 (Tri. - Mumbai)
IN THE CESTAT, WEST ZONAL BENCH, MUMBAI
Shri M.V. Ravindran, Member (J)
COMMISSIONER OF CENTRAL EXCISE, PUNE-II
Versus
INDIAN HUME PIPE CO.LTD.
Final Order No. A/1593/2007-WZB/C-IV/SMB, dated 5-11-2007 in Appeal No. E/349/2007
Cenvat/Modvat - Inputs - Dutiable as well as exempted products manufactured by assessee without maintaining
separate account of inputs - Cenvat credit taken on inputs used in manufacture of exempted products having been
reversed by them, amount of 10% of price of exempted final products not required to be paid by assessee - Demand not
sustainable - Rule 6(3)(a) of Cenvat Credit Rules, 2004. [1996 (81) E.L.T. 3 (S.C.) relied on]. [para 4]
Appeal rejected
CASES CITED
Chandrapur Magnet Wires (P) Ltd. v. Collector — 1996 (81) E.L.T. 3 (S.C.) — Relied on... [Para 3]
Commissioner v. Bombay Dyeing and Mfg. Co. Ltd. — 2007 (215) E.L.T. 3 (S.C.) — Referred [Para 3]
Rashtriya Ispat Nigam Limited v. Commissioner — 2007-TIOL-1478-CESTAT-Bang. — Relied on............... [Paras 3, 4]
REPRESENTED BY : Shri S.G. Dewalwar, SDR, for the Appellant.
Shri Prakash Shah, Advocate, for the Respondent.
[Order]. - This appeal is filed by the Revenue against the Order-in-Appeal No. Pll/BKS/300/06 dated 16-11-06.
2. It is the contention of the ld. SDR that the ld. Commissioner (Appeals) has erred in allowing the appeal of the respondent. It is his
submission that the provisions of Rule 6(3) are very clear, inasmuch, the appellant is required to pay the 10% of amount, having availed of
Modvat credit on the inputs which are used for the manufacture of duty paid and extended goods. It is his submission that no separate accounts
are maintained as per the provisions of Rule 6(3)(a), will come into play and 10% amount of total price of the value of the exempted goods, has
to be reversed.
3. The ld. Counsel appearing on behalf of the respondent submits that the issue is no more res integra, produce decision of the
Hon’ble Supreme Court in the case of Commissioner of Central v. Bombay Dyeing & Mfg. Co. Ltd. as reported at [2007 (215) E.L.T. 3 (S.C.)]
and also decision of the Division Bench of Tribunal in the case of M/s. Rashtriya Ispat Nigam Limited v. Commissioner of Central Excise
[2007-TIOL-1478-CESTAT-Bang].
3. Considered the submissions made by both sides and perused the records. The undisputed facts are that the respondent has used
steel, cement in the prestressed cement for manufacturing of exempt product, as well as dutiable products without maintaining a separate
account of inputs. It is also undisputed that the respondents had reversed the amount of the credit taken on cement which were used in the
manufacture of prestressed cement cleared without payment of duty by availing the exemption given to them on this factual grounds, the ld.
Commissioner (Appeals) has relied upon the decision of the Hon’ble Supreme Court in the case of Chandrapur Magnet Wires (P) Ltd. v.
Collector of Central Excise, Nagpur as reported at 1996 (81) E.L.T. 3 (S.C.). The finding of the ld. Commissioner (Appeals) are very relevant
:-
“In view of the above I find that when the appellants have reversed the Cenvat credit taken on inputs used in the manufacture of
exempted products, they are not required to pay the amount of 10% of the price of the exempted final product. Thus the demand of Rs.
4,15,202/-, interest under Section 11AB of Central Excise Act, 1944 and penalty of Rs. 40,000/- under Rule 15(1) of Cenvat Credit Rules, 2004
are therefore, not sustainable and are set aside”.
4. If it is undisputed that the appellant had reversed the Cenvat credit taken on inputs used in the manufacture of exempted products.
I find that the decision of the Division Bench of the Tribunal in the case of Rashtriya Ispat Nigam Limited (supra) covers the issue in favour of
respondent.
5. Accordingly, the impugned order does not suffer from any infirmity. The appeal filed by the Revenue is rejected.
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