TMI Blog2016 (9) TMI 628X X X X Extracts X X X X X X X X Extracts X X X X ..... o agree with the observations made by the ld. Commissioner (appeals) and hold that as assessee was not maintaining separate account for inputs used in manufacturing of e-bikes and parts thereof, therefore, provisions of Rules 6(3) are squarely applicable to the assessee as the assessee are manufacturing both dutiable and exempted final product and assessee is liable to pay 10% of the value of e-bikes at the time of their clearance and the cenvat credit lying in their cenvat account shall not lapse wholly but the cenvat credit lying in their cenvat account attributable to inputs, work in progress and finished e-bikes shall lapse. As we hold that the provisions of Rule 6(3) are applicable to the facts of the present case, therefore, the provi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nvat Credit Rules, 2004. In these set of facts various show cause notice were issued to the assessee to deny cenvat credit lying in their cenvat account on 29.04.2008 as per Rules 11(3) of the Cenvat Credit Rules. 2004 and sought to demand duty on the E-bikes parts cleared by the appellant after 29.04.2008. The show cause notices were adjudicated, the adjudicating authority confirmed the demand alongwith interest and penalties were also imposed. Some of the said orders were challenged by the assessee before the commissioner (Appels) who granted relief to the assessee. Aggrieved from the order of Commissioner (appeals) Revenue is before us and aggrieved from the adjudication order, the assissee is before us. 3. As the issue involved in th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ee. 6. Heard the parties considered the submissions. 7. We find the after hearing the parties the issue is an under: (i) Whether the provisions of Rule 6(3) of the cenvat Credit Rules are applicable to the present case? (ii) Whether the Cenvat Credit shall lapse on 29.04.2008 when e-bikes became exempted from levy of duty or not? 8. The Facts of the case are not in dispute that assessee is importing e-bikes in CKD condition and clearing the same alongwith indigenously procured battery and paying duty thereon. Therefore, the e-bikes has became exempt from duty w.e.f. 29.04.2008. It is also admitted fact that as assessee was not maintaining separate account of inputs, therefore, the assesse start paying 10% of the value of e-b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .12.2008. Appellants have also argued that credit accumulated, due to higher credit admissible on inputs and less duty leviable on E-bikes, over a period of time and discharging of liability as per Rule 6(3) by the Appellants was correct and in accordance with prescribed law. 6. Adjudicating authority in para 4.4 and 4.4 of the impugned orders, both dated 30.09.2010, has held that registration granted to the Appellants on 05.02.2007 was mentioning only E-bikes, falling under Central Excise Tariff Heading 87119091 as their manufactured product, therefore, it cannot be considered that appellants were manufacturing E-bikes parts. In this regard, appellants has furnished a copy of their registration application, marked as Annexure-K to t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng the relevant period. Therefore, findings of the Adjudicating Authority that only E-bikes were manufactured and no other dutiable product was manufactured by the Appellants is not factually correct. Further, the batteries for E-bikes were become imported as E-bikes in CKD condition as observed from the bills of entry relied upon by the appellants. As no separate accounts were maintained by the Appellants for common inputs, therefore they were required to discharge amounts as per Rule 6(3) of the Credit Rules for common inputs. It is established that appellants were clearing E-bikes parts on payment of Central Excise duty deemed manufactured goods then it has to be held that parts imported by the Appellants during the relevant period used ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Credit Rules. 8. Based on the above observations, the appeals filed by the Appellants are required to be allowable partially on merits. However, no penalty is imposable upon the appellants in this case because the entire facts were known to the department and proper ER-1 returns were also filed with the department indicating payment on duty on clearance of E-bikes part. Therefore, there was no suppression on mi-statement on the part of the Appellants to evade any duty 10. We do agree with the observations made by the ld. Commissioner (appeals) and hold that as assessee was not maintaining separate account for inputs used in manufacturing of e-bikes and parts thereof, therefore, provisions of Rules 6(3) are squarely applicable to ..... X X X X Extracts X X X X X X X X Extracts X X X X
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