TMI Blog2007 (5) TMI 4X X X X Extracts X X X X X X X X Extracts X X X X ..... igh Court of Gujarat at Ahmedabad in Tax Appeal No. 862 of 2005. 3. Respondent is engaged in manufacture of excisable goods, viz., Soda Ash, Sodium Bicarbonate and Caustic Soda. It is registered under 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 Ru ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ubsequent years. (c) Cenvat credit may also be taken in respect of such capital goods as have been received in the factory, but have not been installed, before the 1st day of April, 2000 subject to the condition that 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing jurisdiction over the factory of the manufacturer of the final products who has sent the inputs or partially processed inputs outside his factory to a job worker may, by an order which shall be valid for a financial -year 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 manu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 3-5-2000 is, in question before us. Before embarking on the said question, we may notice that a show cause notice was issued to the respondent on or about 5-5-2001 by the Superintendent Central Excise, AR-II, Porbander directing it 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 d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e scheme. We are not concerned even therewith in this appeal. Clause (c) of sub-rule (2) of Rule 57AC of the Rules is relevant for our purpose inasmuch as in this case, we have noticed herein before, that the second generator set was received 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 limi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 16, 2000 and not prior thereto. Capital goods received after 1-4-2000 are governed by clauses (a) and (b) of sub-rule (2) of Rule 57AC whereas if received prior thereto, the same would be governed by Clause (c) thereof. 10. We, therefore, are of the 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 paten ..... X X X X Extracts X X X X X X X X Extracts X X X X
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