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2023 (6) TMI 295 - AT - Central ExciseCENVAT Credit - interim product/intermediate goods - rubberised textile fabric - requirement to pay 8% of the value of exempted goods as duty - HELD THAT:- The appellant had availed the credit in respect of input used in manufacturing of interim product i.e. rubberised textile fabric. The benefit of exemption was not admissible as the goods were liable to be charged at nil rate of duty. If no credit was taken moreover the said rubberised textile fabric being input used for manufacture of PSP which were cleared at nil rate of duty and consume for same purpose was not eligible for the benefit of exemption Notification No. 67/95-CE dated 16/03/1995. Therefore, the appellant was required to pay 8% of the value of PSP bed cleared by them without payment of duty. It is clear that the appellant has paid 8% of the value of the rubberized textile fabric which in turn in use for manufacture of PSP, therefore, as the appellant has paid 8% of the value of rubberized textile fabric, which means that appellant has not taken the Cenvat Credit of 8% of the value of rubberised textile fabric. The similar issue came up before Tribunal in the case of LIFE LONG APPLIANCES LTD. VERSUS COMMISSIONER OF C. EX., DELHI-III [2000 (4) TMI 90 - CEGAT, COURT NO. II, NEW DELHI] where it was held that the appellant had satisfied the requirement of not taking Modvat Credit on the inputs used in the manufacture of exempted goods. Their case is specifically covered by Rule 57CC as well as the decision of Supreme Court with regard to not availing of Modvat Credit on inputs in the Chandrapur Magnet Wires (P) Ltd. case. The impugned order is, therefore, clearly erroneous. The appellant has paid 8% of the value of the exempted goods on which no credit has been taken by the appellant. Therefore, the appellant is not required to pay 8% of the value of PSP bed cleared by them. Therefore, impugned order is set aside - Appeal allowed.
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