TMI Blog2010 (7) TMI 431X X X X Extracts X X X X X X X X Extracts X X X X ..... pellant. [Order per : H.N. Devani, J. (Oral)]. - Since common issues of the facts and law are involved in both these appeals and the parties are also common, the same were taken up for hearing together and are disposed of by this common judgement. 2.In these appeals under Section 35G of the Central Excise Act, 1944 (the Act), appellant-revenue has proposed the following questions : Tax Appeal No. 1144 of 2009 : "(A)Whether or not the respondent is obliged to reverse Cenvat Credit on the inputs contained in finished goods/semi-finished goods destroyed in fire and such loss of finished goods/semi-finished goods has been adequately compensated by the Insurance? (B) Whether in the facts and circumstances of the case, the Tribun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wise would defeat the purpose of Modvat/Cenvat Scheme and would give an unintended benefit to the assessees? (C) Whether the Tribunal is justified in allowing remission of duty in respect of the finished goods destroyed in fire when the assessee had already been compensated by the insurers for the value of the finished goods which is inclusive of the duties and taxes?" 3. The respondent herein is a registered manufacturer holding Central Excise Registration. On 28th August, 2005, a fire took place at the factory premises of the respondent. The said occurrence was reported to the jurisdictional Central Excise Range Superintendent on 2nd September, 2005, who visited the factory and drew up a Panchnama on 5th September, 2005. Subsequently, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -C.Ex. dated 1-10-2004 issued by the Central Board of Excise Customs. Accordingly, show cause notice came to be issued to the respondent assessee on the ground that the assessee had not reversed the Cenvat credit on inputs lying as such, on inputs contained in semi-finished goods not used in manufacture and also for having contravened the provisions of Circular No. 800/33/2004-C.Ex. dated 1-10-2004, inasmuch as the assessee had not reversed Cenvat credit on the inputs contained in finished products, which had been lost in the fire. The show cause notice culminated into an order dated 27th May 2008 made by the Assistant Collector, Central Excise, whereby the demand came to be confirmed along with interest. 4. The respondent carried the m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Counsel for the appellant-revenue submitted that insofar as inputs contained in semi-finished goods are concerned, it cannot be said that the same have been used in the manufacture of final products as the semi-finished goods had been lost in the fire before being used in the manufacture of final products. Hence, the Cenvat credit in relation to the destroyed semi-finished goods was inadmissible and was required to be reversed. It was further submitted that in light of the Circular No. 800/33/2004-C.Ex. dated 1-10-2004, the respondent was also liable to reverse the Cenvat credit availed of in respect of inputs contained in the finished products which were also lost in the fire. 7. In relation to Tax Appeal No. 593 of 2010, the learned Sen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... me to be confirmed. Accordingly, it was held that the respondent was liable to pay an amount of Rs. 2,18,624/- out of which it had already paid an amount of Rs. 1,21,769/- with interest as applicable under Rule 14 of the Rules. 9. On a plain reading of the impugned order of the Tribunal, it is apparent that Tribunal while holding that Cenvat credit in respect of inputs contained in finished/semi-finished goods cannot be demanded, the Tribunal has only followed the decision of the Larger Bench of the Tribunal. In absence of any distinguishing feature having been pointed out on behalf of the revenue, no infirmity can be found in the approach adopted by the Tribunal. The contention raised on behalf of the revenue vide proposed question [C] t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... involved in the final products only. However, the Commissioner had treated the original as well as revised applications as two applications. The Tribunal held that Commissioner (Appeals) should not have rejected the remission application on the ground that there was a delay in filing the application in view of the fact that there are Tribunal's decisions holding that the delay in filing the application cannot be a ground for rejection of remission application when there is no dispute regarding the loss occurring as a result of circumstances outlined in the relevant rules. The Tribunal accordingly, held that the respondent was eligible for remission of duty involved in the final product. The second ground for rejecting the remission applicat ..... X X X X Extracts X X X X X X X X Extracts X X X X
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