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2017 (2) TMI 1279 - AT - Central ExciseCENVAT credit - molasses used in manufacture of Rectified Spirit - Held that: - the method of proportionate reversal adopted by the appellants, cannot be faulted with and FIFO method cannot be followed as per the wish of the Revenue. Further, rectified spirit, though not excisable, Rule 6(2) is not applicable - demand set aside. Diversion of clearance of inputs as such - Molasses were transferred to another company without the permission of the Department - Held that: - Rule 8 of CCR provides that the Deputy Commissioner and Assistant Commissioner having jurisdiction over the factory of the manufacture of the final products may, in exceptional circumstances, having regard to the nature of the goods and shortage of storage space at the premises of such manufacture, by an order, permit such manufacturer to store the input in respect of which Cenvat Credit has been taken, outside such factory, subject to such limitations and conditions as he may specify, provided that where such input is not used in the manner specified in these Rules for any reason whatsoever, the manufacturer of the final products shall pay an amount equal to the credit availed in respect of such input - Admittedly in the facts and circumstances, there is no case made out by Revenue that the appellant have not manufactured finished products from such inputs which were stored outside. Further, it is an admitted fact that the inputs stored outside were subsequently received back in the factory for which proper records are maintained as recorded in the Panchnama. Appeal allowed - decided in favor of appellant.
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