2006 (11) TMI 537

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..... Shri Anil Kumar, JDR, for the Respondent. [Order per : T.K. Jayaraman, Member (T)]. -  The applicants are required to pre-deposit duty amount of Rs. 47,29,466/- and penalty of Rs. 26,41,089/- besides interest amount of Rs. 26,41,089/-. The appellants availed Cenvat credit on the inputs used in the manufacture of Bulk Drugs. A portion of the bulk drugs, which are exempted, are captively co .....

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..... 2. The learned Advocate Shri B. Seshagiri Rao urged that the lower authorities have not discussed the above mentioned case-laws relied on by the appellant. He stated that the contention of the department that the amount of 8%/10% is to be paid on the value of the exempted Formulations cleared from the factory, is not correct. It was also submitted that there is no mala fide intention on their .....

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..... requested the Bench that as the Revenue has a very strong case on merits, the appellants should be put to terms. 4. We have gone through the records of the case carefully. This case involves the interpretation of Rule 6 of Cenvat Credit Rules, 2002. The relevant portion of Rule 6 is reproduced below :- "Rule 6. Obligation of manufacturer of dutiable and exempted goods. - (1) The CENVAT cre .....

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..... urer shall pay an amount equal to eight per cent of the total price, excluding sales tax and other taxes, if any, paid on such goods, of the exempted final product charged by the manufacturer for the sale of such goods at the time of their clearance from the factory." What is contemplated in the above rule is payment of an amount equal to 8%/10% of the total price of the exempted final product ch .....

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..... 3,265/- including penalty and interest. We direct the appellant to pre-deposit a sum of Rs. 20,00,000/- (Rupees twenty lakhs only) within a period of three months. On such deposits, the balance of duty, penalty and interest stands waived and recovery stayed till the disposal of the appeal. Failure to comply will entail dismissal of the appeal. Call on to report compliance on 16th February, 2007. .....

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