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2005 (4) TMI 224 - CESTAT, BANGALORECenvat/Modvat - Inputs for manufacture of final products - Whether the appellants can avail Modvat credit when they have already paid 8% of the price in terms of Rule 57CC(1) on the exempted final product - HELD THAT:- The exemption which they claimed was also subject to the same condition that Modvat credit should not have been taken on the inputs used in the manufacture of the exempted goods. In order to satisfy these requirements they paid Central Excise Duty of 8% as fixed for such cases under Rule 57CC. Rule 57CC relates to "adjustment of credit on inputs used in exempted final products or maintenance of separate inventory and accounts of inputs by the manufacturer". This rule is specific to cases where adjustment of credit is required to be made as the inputs have gone into the production of exempted final products. Sub-rule (1) of this Rule specifically provides that payment of duty at 8% may be done, if the manufacturer is not able to meet the requirement [under sub-rule (9)] of maintaining separate inventory and accounts of the receipt and use of inputs for the manufacture of goods on which exemption is claimed. Such payment of duty at 8% brings about the adjust (sic) of excess credit taken. In view of the above discussion and the ruling of the Tribunal in the case of M/s. Escorts Ltd.[2004 (8) TMI 216 - CESTAT, NEW DELHI] and Malviya Chemicals [2000 (11) TMI 401 - CEGAT, NEW DELHI], the impugned orders are set aside and appeals allowed with consequential relief if any.
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