TMI Blog2013 (2) TMI 35X X X X Extracts X X X X X X X X Extracts X X X X ..... ertificate from the Chartered Accountant or a Cost Accountant, certifying the amount of input credit attributable to the inputs used in or in relation to the manufacture of exempted goods within a period of six months from the date on which the Finance Bill, 2010 received the assent of the President. Thus, the Finance Act, effective from 08.05.2010 to 07.11.2010 - the six months period, expired on 07.11.2010. The period covered in this appeal is from April, 2008 to December, 2008. Admittedly, the Revenue did not raise any question as regards the non-compliance of Sub Rule (3A) of Rule 6 of the CENVAT Credit Rules before the Tribunal. The only question that was raised before the Tribunal being on the entitlement of the assessee on the reversal of credit attributable to the inputs used in the manufacture of exempted products,no justification to grant the relief sought for in the appeal. For the purpose of this case, it is not necessary at all for us to consider Section 73(2) of the Finance Act, 2010 at all. Consequently, the order of the Tribunal is confirmed. - CMA.No.3289 of 2012 and MP.No. 1 of 2012 - - - Dated:- 11-1-2013 - Mrs.CHITRA VENKATARAMAN AND Mr. R.KARUPPIAH, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the appeal before this Court is between April 2008 and December 2008. Rule 6 of CENVAT Credit Rules prescribes the procedure as regards availing of CENVAT Credit, particularly in cases where, a part of the manufactured items are exempted and a part of the manufactured items are subject to levy of duty. Rule 6 of CENVAT Credit Rules states that CENVAT credit shall not be allowed in respect of input used in or in relation to the manufacture of exempted goods or for provision of exempted services. Therefore, the credit is availed only in respect of manufactured goods which are subjected to duty. In a given situation where the manufacturer produces goods that attract levy as well as goods which are exempted, the manufacturer or provider of output service must maintain separate accounts. Rule 6(2) of CENVAT credit Rules reads as follows:- "6(2) Where a manufacturer or provider of output service avails of CENVAT credit in respect of any inputs or input services and manufactures such final products or provides such output service which are chargeable to duty or tax as well as exempted goods or services, then, the manufacturer or provider of output service shall maintain separate accoun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es exempted goods, namely, dead burnt magnesite falling under TSH 2505.00 of the Central Excise Tariff Act, 1985. According to the Revenue, the assessee had taken CENVAT credit on common input, namely, furnace oil, under Rule 3 of the CENVAT Credit Rules, 2004, for which they had not maintained any separate records for the receipt, consumption and inventory of inputs meant for use in the manufacture of both dutiable and exempted final products. The assessee had cleared the exempted goods without payment of amount equal to the extent of the total price of dead burnt magnesite, as required under Rule 6(3)(b) during April, 2008 to December, 2008. 5. As far as the present case is concerned, admittedly, the respondent herein manufactured items which are dutiable as well as exempted. Hence, Rule 6 of the CENVAT Credit Rules is relevant to the case on hand. 6. Thus a notice was issued by the Adjudicating Authority as to the entitlement of the assessee to the applicability of Sub Rule (3A) of Rule 6 of the CENVAT Credit Rules. The assessee stated that it had maintained separate accounts of inputs; they issued Furnace Oil from the storage tank through pipe lines fitted with Flow Met ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e went on appeal before the Customs, Excise and Service Tax Appellate Tribunal. 8. The Tribunal set aside the order and allowed the appeal by remanding the matter back to the Adjudicating Authority for deciding the matter afresh, in the light of the retrospective amendment to the Rules along with an application filed by the assessee under Section 73 of the Finance Act, 2010. Referring to the retrospective amendment in CENVAT Credit Rule 6, done by Section 73 of the Finance Act, 2010, the Tribunal pointed out that the assessee had submitted necessary application as per Section 73 of the Finance Act, 2010 and such application was pending for decision. The Revenue submitted that if proper reversal of credit attributable to the inputs used in the manufacture of exempted products was done, there was no scope for further demand. Hence, the question whether credit had been properly reversed, required to be examined. Thus, setting aside the order of the Adjudicating Authority, the Tribunal remitted the matter back to the Adjudicating Authority for deciding the matter afresh in the light of the amendment to the Rules along with the application filed by the assessee under Section 73 of F ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... redit on duty paid on all inputs used in the manufacture of goods suffering duty and the assessee could make a debit entry in the credit account before removal of the exempted final products, she pointed out that part of Dead Burnt Magnesite is also consumed in the manufacture of refractory bricks dutiable final products. Hence, by arithmetical calculation, the exact quantum of furnace oil consumed with respect to Dead Burnt Magnesite cleared outside the factory, could be calculated and based on this, proportionate credit was reversed by the assessee. Consequently, the question of applying Rule 6(2)/6(3) demanding 10% of the price of Dead Burnt Magnesite did not arise. All that the Tribunal has done herein is to direct verification as to whether the calculation adopted by the assessee was correct or not. She pointed out that the amendment to the Rule itself came only during the pendency of the appeal. As such, the time limit spoken to, will not apply to the assessee's case. In any event, the assessee had already reversed the proportionate credit and all that is required herein is the verification on the calculation done by the assessee. The amendment containing the option for the p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... said Rule covers the case of the assessees in whose cases there existed a dispute relating to adjustment of credit on inputs or input services used in or in relation to exempted final products and the period of dispute related to the period beginning from 10th September, 2004 to 31st March 2008. In such cases, as per Section 73(2) of the Finance Act, 2010, the assessee has to make an application to the Commissioner of Central Excise along with documentary evidence and a certificate from the Chartered Accountant or a Cost Accountant, certifying the amount of input credit attributable to the inputs used in or in relation to the manufacture of exempted goods within a period of six months from the date on which the Finance Bill, 2010 received the assent of the President. Thus, the Finance Act, effective from 08.05.2010 to 07.11.2010 - the six months period, expired on 07.11.2010. The period covered in this appeal is from April, 2008 to December, 2008. 14. Admittedly, the Revenue did not raise any question as regards the non-compliance of Sub Rule (3A) of Rule 6 of the CENVAT Credit Rules before the Tribunal. The submission of the Revenue before the Tribunal was that if proper reve ..... X X X X Extracts X X X X X X X X Extracts X X X X
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