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2018 (8) TMI 1670 - CESTAT MUMBAICENVAT credit - inputs used in manufacture of both exempted goods and dutiable goods - Remand order - determination of value of ‘chloroquine’ at 115% of the cost of manufacture for discharge of liability at 8% under rule 57AD of the erstwhile Central Excise Rules 1944 - Held that:- That ‘chloroquine phosphate’ is an exempted product is not in dispute. Payment of duty on exempted products does not, in any way, take it out of sphere of the definition of the ‘exempted goods’ in the Central Excise Rules, 1944 or the successor rules carved out for administration of CENVAT Credit Rules, 2004. Accordingly, to the extent that ‘chloroquine phosphate’ is an exempted goods and that in the manufacture of those, and other dutiable goods, the appellant has utilized common inputs taking credit thereof, without distinguishing between utilization on exempted goods and on dutiable goods, the liability under rule 57AD of Central Excise Rules, 1944 cannot be avoided. The appellant has claimed that duty liability has been discharged on both ‘chloroquine phosphate’ and ‘bulaquine’ by adopting a value which takes into account both these products. If that is so, the duty discharged on ‘chloroquine phosphate’ is liable to be set off against liability under rule 57AD owing to the exempt nature of the ‘chloroquine phosphate’. That is an aspect that needs to be ascertained by the lower authorities. Matter remanded for ascertaining (i) to ascertain if duty liability has been discharged on ‘chloroquine phosphate’ at 16% of the value; (ii) determine the value of ‘chloroquine phosphate’ for the purpose of liability under rule 57AD of Central Excise Rules, 1944; and to compute the resultant duty liability that remains - appeal allowed by way of remand.
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