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TMI Blog2010 (7) TMI 144X X X X Extracts X X X X X X X X Extracts X X X X ..... on input used as Fuel viz., Furnace Oil in terms of Rule 57B of the Central Excise Rules, 1944 which was being used to make dutiable as well as exempt goods. The company was availing credit on the whole of furnace oil irrespective of whether it was used in manufacture of dutiable goods or exempt goods. Show cause notice dated 11.03.1997 was issued to the company asking them as to why the credit of Rs.10,92,831/- for the period of May 1997 to September 1997 should not be denied to them because they were availing credit of the full amount irrespective of the fact whether they were manufacturing exempted goods or dutiable goods as prescribed under Rule 57 I of the Central Excise Rules, 1944. Another show cause notice dated 11.03.1998 was issu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... evant Rules including Rule 57AD of the Central Excise Rules, 1944 on the basis of which the Tribunal has also passed the order, the Supreme Court has held that the assessee would not be entitled to any benefit under the aforesaid provision. Relevant discussion in this behalf contained in the Para 10 of the judgment reads as under: "10. In our view, Sub-rule (1) is plenary. It restates a principle, namely, that CENVAT credit for duty paid on inputs used in the manufacture of exempted final products is not allowable. This principle is in-built in the very structure of the CENVAT scheme. Sub-rule (1), therefore, merely highlights that principle. Sub-rule (1) covers all inputs, including fuel, whereas Sub-rule (2) refers to non-fuel-inputs. S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the above case of Gujarat Narmada Valley reported in (2006) 193 ELT 136 (supra)." 4. Learned counsel for the respondent could not dispute the aforesaid position in law. Accordingly, this Appeal succeeds and orders of the Tribunal as well as Commissioner (Appeals) are hereby set aside and the orders of the Assistant Commissioner, Salem Division is restored. 5. We may, however, clarify that the respondent shall not be liable to pay any penalty or interest inasmuch as in the show cause notice dated 11.03.1998, levy of penalty or interest was not even proposed. Moreover, the order dated 18.03.1999 also does not cover this aspect. The aforesaid directions are in conformity with the judgment of the Supreme Court in Gujarat Narmada Fertiliz ..... X X X X Extracts X X X X X X X X Extracts X X X X
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