TMI Blog2008 (1) TMI 126X X X X Extracts X X X X X X X X Extracts X X X X ..... , Member (T) [Order per: A.K. Srivastava, Member (T)]. -1. Excise Appeal No. 3521 of 2006 has been filed by M/s. HMT Limited against the order-in-original17/Comm/PKL/05 dated 22-9-2005 passed by the Commissioner of Central excise, Panchkula. 2. The Commissioner, vide the impugned order, has confirmed the demand of Central Excise duty amounting to Rs. 2,07,75,376/- under Rule 12 of the Cenvat Credit Rules, 2002 read with Section 11A of the Central Excise Act, 1944, He also imposed penalty of Rs. 2,07,75,376/- under Rule 13 of Cenvat Credit Rules, 2002 for the intentional violation of the provisions of Rule 6(1) of Cenvat Rules, 2002. He also ordered for recovery of interest on the above confirmed demand amount under the provisions ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ors lying in stock consequent upon tractors being exempted from Central Excise duty with effect from 9-7-2004. He also orders recovery of interest under Section 11 AB of the Act ibid . He also impose penalty of Rs. 60,00,000/- under Rule 13 of the Cenvat Credit Rules, 2002. 5. Heard both sides and perused the records. 6. The appellants are engaged in the manufacture of tractors of various types falling under the Chapter Heading No. 87.01 of the First Schedule to the Central Excise Tariff Act, 1985. 7. The issue involved in all the three appeals is common i.e. whether the Cenvat credit involved on the inputs lying in stock as such or contained in the work in process or used in the manufacture of tractors lying in stock was requi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cators cited supra was dismissed by the Supreme Court as reported in 2003 (156) E.LT. A212 (S.C.). Similarly, the civil appeal filed by M/s. Albert David Ltd ., against the Tribunal's order was dismissed by the Supreme Court as reported in Commissioner v. Albert David Ltd ., 2003 (157) E.L.T. A81 (S.C.). Further, the review petition filed by the said company was also dismissed by the Supreme Court as reported in Commissioner v. Albert-David Ltd . 2003 (158) E.L.T. A273 (S.C.). 10. While the five member Bench of the Tribunal in the case of Ashok Iron and Steel Fabricators has held that the credit availed and utilized during the period when final products were dutiable is not to be reversed when subsequently the final produ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... excise authorities except where it has been illegally or irregularly taken, in which even if stands cancelled or, if utilized, has to be paid for. We are here really concerned with credit that has been validly taken, and its benefit is available to the manufacturer without any limitation in time or otherwise unless the manufacturer itself chooses not to use the raw material in its excisable product. The credit is, therefore, indefeasible. It should also be noted that there is no co-relation of the raw material and the final product; that is to say, it is not as if credit can be taken only on a final product; that is manufactured out of the particular raw material to which the credit is related. The credit may be taken against the excise dut ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... teel case are not applicable, as those decisions were passed on the ground that there was no provision for reversal of credit. It has been further stated 'Now, there is a specific provision in Rule 57AD which clearly provides that "CENVAT credit shall not be allowed on such quantity of inputs in which is used in the manufacture of exempted goods" We are afraid that the above observations of the Tribunal are contrary to for the Supreme Court dictum in Dai Ichi Karkaria case. We want to emphasize that the Supreme Court has stated that when the credit is validly taken, its benefit is available to the manufacturer without any limitation in time or otherwise unless the manufacturer itself chooses not to use the raw material in its excisabl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... egally or irregularly taken as also for recovery of credit if already utilized. In the appellants' own case, the Bangalore Bench of the Tribunal held, on a similar set of facts that the decision in Albert David was per incuriam. With great respect, 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". 14. Because of the conflicting orders passed by the two coordinate Benches of the Tribunal, the matter n ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
