TMI Blog2016 (3) TMI 99X X X X Extracts X X X X X X X X Extracts X X X X ..... re is no credit of Central Excise duty availed by the appellants on the common inputs. The only credit availed is education cess paid on such common inputs. The final products are of two categories tractors with engine capacity of above 1800 CC or below 1800 CC. Industrial cess is leviable on the tractors with capacity of above 1800 CC. Education cess is payable on such industrial cess. The appellants utilized the credit of education cess availed on inputs to discharge education cess on tractors of above 1800 CC. There is no industrial cess or education cess on the tractors of below 1800 CC. Accordingly they calculated the proportionate credit of education cess availed on common inputs and reversed the same. We find there is no dispute on t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pellants are engaged in manufacture of both type of tractors and were using common inputs without maintaining separate accounts for receipt and consumption of these inputs. Invoking the provisions of Rule 6 (3) (b) of Cenvat Credit Rules, 2004 proceedings were initiated against the appellant to recover 10% of value of the exempted tractors. The Original Authority vide the impugned order confirmed a demand of ₹ 2,68,25,330/- and imposed a penalty of an equivalent amount on the appellants. Aggrieved by the said order, the appellants filed this appeal. 2. The learned Counsel for the appellant Shri Amit Jain submitted that the impugned order is legally unsustainable, lacking in judicial discipline and contrary to various judgments of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ty is sufficient compliance of the conditions of Rule 6 and there could be no further liability on the appellant. 3. The learned AR Shri Govind Dixit reiterated the findings in the impugned order. He further submitted that the appellants did not maintain separate accounts as required by the Rule 6 and reversal, if any, subsequent to the clearance of exempted goods will not be considered as sufficient compliance of the said provisions. He submitted that the impugned order correctly invoked the provisions of Rule 6 (3) (b). 4. We have heard both the sides and examined the appeal records. The point for decision in this appeal is whether or not the appellants are liable to pay an amount equal to 10% of the value of tractors of engine capa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t equal to 10% of the total price of exempted tractors invoking Rule 6 (3) (b) of the Cenvat Credit Rules, 2004. We find such a demand is not legally sustainable as already held in various decisions of this Tribunal and as affirmed by the Hon ble Supreme Court. 5. The Hon ble Supreme Court in Chandrapur Magnet Wires (P) Ltd. vs. CCE, Nagpur reported in 1996 (81) E.L.T. 3 (S.C.) held that if the debit is made of the credit availed earlier it will amount to non-availment of such credit. We find though the Original Authority examined the said decision of the Hon ble Supreme Court he distinguished the same on the ground that reversal of proportionate credit of education cess for a particular period was made much later after the clearance of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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