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TMI Blog2007 (5) TMI 4X X X X Extracts X X X X X X X X Extracts X X X X ..... r the Central Excise Tariff Act, 1985. Its products are governed by the provisions of the Chapter VIIA of the Rules. It has been availing the benefit of credit of duty paid on inputs as well as capital goods under the provisions of the Rules. 4. On or about 24-9-1996, the respondent imported two generator sets. We are herein concerned with the second one. Although it was received by the respondent on 24-10-1998, the same admittedly was not installed prior to 1-4-2000. In the relevant financial year, the rule which was in operation was Rule 57Q(3) of the Rules was as under: "57Q(3). Notwithstanding anything contained in sub-rule (1), the manufacturer of the final products shall be allowed credit of additional duty leviable under Section 3 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... during the financial year 2000- 2001, the credit shall be taken for an amount not exceeding fifty per cent of the duty paid on such capital goods. Illustration.- A manufacturer received machinery on April 16, 2000 in his factory. Cenvat of two lakh rupees is paid on this machinery. The manufacture can take credit up to a maximum of one lakh rupees in the financial year 2000-2001, and the balance in subsequent years. (3) The Cenvat credit in respect of duty paid on the capital goods shall be allowed to a manufacturer even if the capital goods are acquired by the manufacturer on lease, hire purchase or loan agreement, from a financing company. (4) The Cenvat credit in respect of capital goods shall not be allowed in respect of that part o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r in respect of removal of such inputs or partially processed inputs, and subject to such conditions as he may impose in the interest of revenue including the manner in which duty, if leviable, is to be paid, allow finished goods to be cleared from the premises of the job worker. (7) Where any inputs are used in the final products which are cleared for export under bond or used in the intermediate products cleared for export, the Cenvat credit in respect of the inputs so used shall be allowed to be utilized by the manufacturer towards payment of duty of excise on any final products cleared for home consumption or for export on payment of duty and where for any reason such adjustment is not possible, the manufacturer shall be allowed refund ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to show cause as to why: "(i) The amount of credit amounting to Rs.8,51,490/- (6,56,481/- plus 1,95,009/- should not be recovered from them under 57AH of the Rules read with Section 11 of the Act; (ii) Interest @ 24% should not be levied upon them as per the provisions of Section 11AB of the Act. (iii) Penalty should not be imposed upon the Noticee under Rule 173Q(1) of the Rules;" Cause was shown. The matter was determined by the Assistant Commissioner of Central Excise, Junagadh in terms of an order dated 13-9-2001 holding that the respondent was entitled to Cenvat credit only to the extent of 50%. An appeal preferred thereagainst by the respondent aggrieved by and dissatisfied therewith before the Commissioner (Appeals), Customs and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on 24-10-1998, but was not installed prior to 1-4-2000. Applicability of Grasirn Industries Ltd (supra) vis-a-vis Rule 57Q(3) of the Rules has now become irrelevant. Clause (c) of sub-rule (2) of Rule 57AC of the Rules deals with a situation with which we are concerned. By reason of the said provision, the credit sought to be given by reason of Rule 57Q(3) has not been taken away in its entirety, but merely postulates that if the credit had not already been availed, the same merely be obtained but limited only to the extent of 50% thereof. 8. A beneficient statute may have to be considered liberally but where a statute does not admit of more than one interpretation, literal interpretation must be resorted to. The provision allows taking of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... opinion that the High Court was not correct in opining that Cenvat credit to the extent of 100% could be allowed in terms of Rule 57AC of the Rules. 11. Mr. Ramesh Singh, learned Counsel appearing on behalf of the respondent, however, submitted that credit had been given only to 50% of the total amount of duty paid, as would appear from the order of the Commissioner dated 31-12-2001 which is in the following terms: "On going through the sub-rule 2(c) of Rule 57AC it is very much patent that the items of capital goods which have not been installed (emphasis supplied) before lst day of April, 2000 would be entitled to the credit for an amount not exceeding fifty per cent of the duty paid on such capital goods. I find that in the instant c ..... X X X X Extracts X X X X X X X X Extracts X X X X
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