TMI Blog2007 (2) TMI 40X X X X Extracts X X X X X X X X Extracts X X X X ..... the said date. On 9-7-2004, the date on which the above goods were exempted from duty under Notification No. 6/2002-C.E. as amended by Notification No. 23/2004-C.E., dated 9-7-2004, there were stocks of inputs as such and of final product in their factory and Cenvat credit of the duty paid on the inputs present in stock and on the inputs contained in the final product present in stock had already been taken. The credits so taken on inputs lying as such in stock as on 9-7-2004 and on inputs contained in the finished tractors lying in stock as on that date were to the extents of Rs. 2,39,29,898/- and Rs. 2,02,72,473/- respectively. According to the department, these credits were liable to be reversed by the appellants as their final product w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to be decided upon in this case is whether the appellants were entitled to take Cenvat credit of the duty paid on the inputs lying in stock as on 9-7-2004 and the inputs contained in the finished tractors lying in stock as on that date. 3. Learned Counsel submitted that the above issue was already covered in favour of the appellants by Final Order No. 2103/2006 dated 23-11-2006 [2007 (210) E.L.T. 571 (Tribunal)] passed by the South Zonal Bench, Bangalore in Appeal No. E/418/2005 (M/s. Tafe Ltd. (Tractor Division) v. CCE, B'lore). Ld. Counsel also relied on the Tribunal's Larger Bench decision in the case of CCE, Rajkot v. Ashok Iron Steel Fabricators, 2002 (140) E.L.T. 277 (Tri. - LB). Reliance was also placed on the Apex Court's judg ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a) which pro vided basis for a sweeping finding that there was no rule providing for reversal of Modvat/Cenvat credit and, therefore, the view taken in Final Order No. 2103/06 ibid on the basis of Dai Ichi Ksrkaria (supra) was erroneous. Ld. SDR urged that the view taken by the Tribunal in Albert David (supra) be followed in the present case. She pointed out that the said decision had been followed by the Tribunal in the cases of CCE, Ghaziabad v. Explicit Trading Marketing (I Ltd., 2004 (169) E.L.T. 205 (Tri. - Del.), Sunsui India Ltd. v. CCE, Jaipur, 2004 (170) E.L.T.459 (Tri. - Del) and CCE, Indore v. Ives Drugs (I) Pvt. Ltd., 2005 (191) E.L.T. 639 (Tri. - Del.). 5. In his rejoinder, learned Counsel sought to distinguish the cases ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ules, 1994. Prior to the coming into force of Rule 57AD, Rule 57C had held the field. The provisions of Rule 57C were no different from the successor-Rule 57AD. These rules mandated that no credit of duty paid on input would be allowed if the final product was exempt from the whole of the duty of excise leviable thereon or chargeable to 'Nil' rate of duty. In the case of Dai Ichi Karkaria (supra), the Hon'ble Supreme Court examined the Modvat Rules including Rule 57C and held as under "It is clear from these Rules, as we read them, that a manufacturer obtains credit for the excise duty paid on raw material to be used by him in the production of an excisable product immediately it makes the requisite declaration and obtains an acknowledgem ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tors (supra) was dismissed by the Apex Court. On the other hand, the contra view taken by a Two- Member Bench of the Tribunal in the case of Albert David Ltd. (supra) after distinguishing the case of Ashok Iron Steel Fabricators (supra) stood affirmed by the Apex Court when the civil appeal filed against it by the party was dismissed by the court. The review petition filed by the party was also dismissed by the court in an order reading as follows: "Delay condoned. We have gone through the review petition and the connected records. We do not find any merit therein. The review petition is, therefore, dismissed." Applying the doctrine of merger, we find that the view taken in Albert David case having the stamp of approval of the Apex ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... espect, we are unable to agree with such an observation. We are of the considered view that the Tribunal's decision in Albert David case, affirmed by the Apex Court, requires to be followed in the present case and, accordingly, we hold that the credit taken by the appellants on the inputs lying in stock as on 9-7-2004 is liable to be reversed if unutilized and to be recovered if utilized. 8. The same logic is applicable to inputs contained in the final products lying in stock as on 9-7-2004 also as held by the Tribunal in the cases of Explicit Trading Marketing (supra), Sunsui India (supra) and Ives Drugs (supra). Accordingly, it is held that the credit taken on the input contained in the final product lying in stock as on 9-7-2004 is ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
