TMI Blog1996 (4) TMI 257X X X X Extracts X X X X X X X X Extracts X X X X ..... ember (T)]. The appellants manufacture excisable products, namely, front and rear wheel assemblies, knuckle steering, tools and implements in the manufacture of which they use materials, duty paid on which is being availed of as Modvat credit under Rule 57A of the Central Excise Rules. Some of these products were being cleared by them free of duty under Chapter X Procedure. For the inputs us ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mitted that as far as the disallowance of Modvat in respect of the inputs used in the manufacture of exempted final products is concerned, they have no case in terms of the larger Bench decision in Kirloskar Oil Enginess [1994 (73) E.L.T. 835 (Tri.) = 1994 (4) RLT 296]. Even as regards the differential quantity involved between the weight of inputs issued for the manufacture of such exempted produ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it would have been a very difficult job for them to apportion the scrap according as it arose in relation to duty paid products or products cleared free of duty. Such segregation was also not a practical proposition, as such scrap arose from the manufacture of their products which were cleared under both categories and at the time of manufacture, such segregation as between dutiable products and e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he whole of the duty of excise leviable thereon or is chargeable to nil rate or duty or is not specified as a final product under Rule 57A. In this particular case, as pointed out by the learned counsel, they cleared the resulting scrap on payment of duty. Since the duty demand as a result of disallowance of Modvat credit is referable to the scrap arising in the course of manufacture of the final ..... X X X X Extracts X X X X X X X X Extracts X X X X
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