TMI Blog2005 (6) TMI 353X X X X Extracts X X X X X X X X Extracts X X X X ..... No. 10/97-C.E., dated 1-3-1997. Such clearances were made without payment of duty as they were wholly exempt from duty under the said Notification. The remaining quantity of Ammonium Chloride was cleared, on payment of duty, to other buyers. Thus, during the above period, there were clearances of both dutiable and exempt goods from the factory and, consequently, Rule 6 of the Cenvat Credit Rules, 2002 got attracted as M/s. TPL had availed Modvat credit on the inputs used in the manufacture of the entire quantity of Ammonium Chloride. The Rule required that, where input duty credit was availed in this manner, the manufacturer should pay 8% of the sale price of the exempted goods to the Revenue. M/s. TPL paid to Government 8% of the sale pric ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... price from VSSC did not represent excise duty, the demand raised by the Department under Rule 12 ibid is not sustainable. Ld. Counsel has also referred to Board s Circular No. 599/36/2001-CX., dated 12-11-2001 and has claimed support therefrom. Ld. SDR has also relied on this circular and has pointed out that the circular expressly barred Collection, by the manufacturer from his buyer, of the amount of 8% paid by the former to the Government under Rule 57CC. Ld. SDR has also reiterated the findings of the Commissioner (Appeals). 3. After giving careful consideration to the submissions, I find that it is not in dispute that Rule 6 (corresponding to erstwhile Rule 57CC) required M/s. TPL to pay to Government 8% of the sale price of Ammonium ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iously, the Department equated the two and took the stand that the amount recovered by M/s. TPL from their buyer (equal to 8% of sale price of the exempted goods paid to the Government) was equivalent to the Modvat credit taken on the inputs used in the manufacturer of the exempted goods. Accordingly, they invoked Rule 12, which provided for recovery of irregularly availed Modvat credit, for recovering from M/s. TPL the amount which the latter had collected from their buyer. The amount collected by M/s. TPL from VSSC is not in the nature of Cenvat credit. Hence the demand under Rule 12 cannot be sustained. 4. At the same time, I am unable to accept the appellants claim that the above amount was not represented as duty of excise. The natu ..... X X X X Extracts X X X X X X X X Extracts X X X X
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