TMI Blog2006 (3) TMI 11X X X X Extracts X X X X X X X X Extracts X X X X ..... eard both sides. The respondents have taken input duty credit on Nitrogen Gas, which is received through pipeline. Most part of it has been used in manufacture of dutiable lamps and some part of it has been used for non-dutiable lamps. 2. The learned Advocate for the respondents states that it is not in dispute that since the nitrogen gas is received through pipeline is in not possible to segreg ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ersal and requires 8% of the value of the exempted clearances to be paid. 4. The lower appellate authority has allowed the appeal of the respondents setting aside the order of the original authority relying on the Hon'ble Supreme Court's decision in the case of Chandrapur Magnet Wires (P) Ltd. v. CCE, Nagpur - 1996 (81) E.L.T. 3 (S.C.). Hence, this appeal has been filed by the department. 5. S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... upreme Court in the case of Chandrapur Magnet (supra) was given in the context of a particular notification and not in the context of Rule 57AD of the Central Excise Rules, 1944. The learned SDR also states that permitting reversal of the credit when the rule does not provide for the same would render the rule nugatory. 6. It is argued by the learned Counsel for the respondents that the ratio of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... parate accounts. The spirit of Rule 57AD is that input duty credit cannot be allowed to exempted final product. Though the decision in the case of Chandrapur Magnet (supra) has been rendered in the context of an exemption notification, the ratio of the said decision holding that reversal of credit before clearance of the exempted goods amounts to non-availing credit, when it is not possible to seg ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eme Court in the of Chandrapur Magnet (supra). We also note that the wordings of the cited and the cited circulars do not deal with a situation when it is not possible to segregate the inputs, whereas such a situation has been dealt by the Hon'ble Supreme Court's decision in the case of Chandrapur Magnet (supra). 9. In view of our findings as above, we are of the opinion that the impugned order ..... X X X X Extracts X X X X X X X X Extracts X X X X
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