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2010 (1) TMI 401 - AT - Central ExciseCenvat Credit- The appellants are engaged in the manufacture of Steel Patta Patti and they clear the same on the payment of duty. Since the appellants are not maintaining separate account in respect of inputs used in the manufacture of dutiable and exempted goods, appellants were required to pay 10% of the value as per the provisions of Rule 6(3) of Cenvat Credit Rules. Instead of paying 10% the appellants paid 16% by reversing cenvat credit and it was informed to them that this procedure was wrong and accordingly show cause notice was issued requiring the appellants to show cause as to why the amount of Rs. 1,13,092/- should not be recovered from them under Section 11D of Central Excise Act, 1944 and interest as applicable under Section 11DD should not be recovered from them. The Original Adjudicating Authority upheld the demand and imposed penalty of equal amount of duty demanded. On an appeal filed by the appellant, Commissioner (Appeals) held that as per the provisions of Rule R (sic) of Cenvat Credit Rules, appellants can pay 10% by reversing the Cenvat credit but the balance amount is to be paid in cash. Party is in appeal against this decision. Held that- inputs used commonly in exempted and dutiable products. Assessee paying 16% of value under Rule 6(3) of Cenvat Credit Rule 2004 by reversing Cenvat Credit. Since assessee had paid duty recovered by them to Government demand under section 11D of Central Excise Act was not sustainable.
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