TMI Blog2018 (7) TMI 777X X X X Extracts X X X X X X X X Extracts X X X X ..... or reversal of actual credit by the manufacturer availing the credit of specified duty in respect of inputs used for manufacture of final product, which are not chargeable to duty or chargeable to nil rate of duty by payment of amount equivalent to amount of credit attributable to inputs used in the manufacture of such final products - said amendment was retrospective in nature and covers the impugned period in this appeal. It has not been disputed by the Revenue that the appellants have reversed the credit taken in respect of inputs, though admittedly, one reversal of ₹ 34,827/- was made in April, 2002 and the other reversals were made before the issuance of show cause notice - the demand on account of disputed Modvat credit, whi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ulded parts of sewing machine. As the inputs used were common, therefore, the appellants were required to maintain separate inventory and account of inputs used in the manufacture of dutiable products and exempted products. The appellants were filing declarations under Rule 57G from time to time. A dispute arose as the appellants took Modvat credit on common inputs used in manufacture of exempted final products, some of which was reversed on proportionate basis. The remaining part of Modvat credit was reversed after many years. The period involved is 01.09.1996 to 31.03.1999. Accordingly, a demand was raised in terms of Rule 57CC of Central Excise Rules, 1944 demanding 8% of sale price of exempted goods. The matter was adjudicated and the d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... DB]. 4. Ld. A.R. for the Revenue reiterated the findings in the order of Commissioner (Appeals) and contended that interest at applicable rate prescribed in Finance Act, 2010 was payable on the amount reversed in terms Rule 57CCC under Finance Act, 2010. 5. Heard both the sides and perused the records. 6. We find that in this case the dispute relates to irregular availment of Modvat credit in respect of final product carrying nil rate of duty. The demand was, therefore, confirmed under Rule 57CC of Central Excise Rules asking the appellants to pay an amount of 8% of sale price of exempted goods. The appellants claim is that they were reversing the Modvat credit on proportionate basis in respect of some inputs used in the manufa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt statutory scheme is condonable as the appellants were prosecuting remedy before this Tribunal. 7. It has not been disputed by the Revenue that the appellants have reversed the credit taken in respect of inputs, though admittedly, as pointed out by Ld. Advocate, one reversal of ₹ 34,827/- was made in April, 2002 and the other reversals were made before the issuance of show cause notice. 8. In view of the foregoing, the demand on account of disputed Modvat credit, which has already been reversed by the appellants, is liable to be set aside. In view of Rule 57CCC and statutory scheme introduced in Finance Act, 2010, the appellants are liable to pay an interest @24% per annum for the intervening period from the date of clearance ..... X X X X Extracts X X X X X X X X Extracts X X X X
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