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2016 (9) TMI 424 - AT - Central ExciseSSI Exemption - Demand for January 1998 to March 1998 - manufacture of plastic spoon for Complan and Farex - availment of ineligible concessional rate of duty under SSI notification 4/97 - appellant claimed that they had not availed modvat/ cenvat credit in respect of inputs used for manufacture of Farex spoon - Held that:- Notification 4/97 dated 01.03.1997, clearly envisages the exemption to final product to SSI only if modvat credit is not availed. In the absence of any evidence indicating that the appellant had not availed the modvat credit on the inputs, the impugned order confirming the demand of the duty with interest is correct. Imposition of penalty - Rule 173Q of the erstwhile Central Excise Rules, 1944 - Held that:- it is found that the adjudicating authority as well as the first appellate authority has not indicated under which sub-rule of Rule 173Q the penalty has been imposed. It is a settled law that for imposing penalty under Rule 173Q, specific sub-rule needs to be invoked. In any case, we find that the appellant could have entertained a bona fide belief that he can avail the benefit of SSI exemption in respect of Farex spoon which are manufactured out of inputs on which modvat credit was not availed. Therefore, the appellant need not be visited with any penalty under Rule 173Q. - Decided partly in favour of assessee
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