TMI Blog2018 (11) TMI 1363X X X X Extracts X X X X X X X X Extracts X X X X ..... thereon or is chargeable to nil rate of duty or is specified as a final product under Rule 57A. The waste and scrap of plastic emerges as the by-product and not as a final product - appeal allowed - decided in favor of appellant. - E/81/2008 - FO/A/76841/2018 - Dated:- 14-6-2018 - Shri P.K.Choudhary, Member (Judicial) and Shri Bijay Kumar, Member (Technical) Shri Ravi Raghavan Adv. for the Appellant (s) Shri D. Haldar, AC(AR) for the Respondent (s) ORDER The appellant has filed the impugned order being aggrieved with the impugned order, Order-in-Original No. 62/Commr./ BOL/ 07 dated 25 th September, 2007. 2. The issued involved in this case is that the appellant is manufacturer of BOPP films, (biaxially Oriented ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e being manufactured from the duty paid waste, paring and scrap of plastic material on which Modvat credit had been availed. And the Revenue entertained the view that proportionate Modvat credit on the input, that is PPG granules (imported from indigenous), were required to be reversed as per Rule 57C of the Central Excise Rules, 1944. Therefore, it was alleged that the appellant has irregularly availed Modvat credit amounting to ₹ 1,71,26,749.90/-. It was held in the impugned order that assessee has not informed the Department in any manner about the activity of manufacturing RPG and even they have not followed the terms and conditions of the said Rule and Notification No. 14/92 dated 01/03/92. It was held that the appellant had will ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the goods in the classification list, and therefore, the processed granules cannot be considered as the bye-product. From the adjudication order it is also evident that the manufacturer has specially installed a scrap plant for the manufacture of RPG which was being used for the manufacture of BOPP films along with the virgin PP granules. Therefore, it was vehemently argued that the impugned order does not suffer from any infirmity and the case laws sited by the Ld. Advocate on behalf of the appellant cannot be relied upon. 5. We have considered the rival contentions and also perused the case records. 6. It is held in the adjudication order as per Rule 57C of the Modvat credit Rule Credit of duty is not to be allowed if final product ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d in the manufacture of final product shall be allowed if the final product is exempt from the whole of the duty of Excise leviable thereon or chargeable to nil rate of duty. However, we find that the Adjudicating Authority has mis-directed himself in arriving at the aforesaid conclusion. We find that the present issue is squarely covered by this Hon ble Tribunal s decisions in case of Cosmo Films (supra) wherein it is held as under; 5.1 As regards the contention of the Revenue that once credit has been taken, the inputs become non-duty paid, this contention is not based on any provision of law. Nowhere in the Central Excise Act or Rules, it is stated that when the credit is taken, the input becomes non-duty paid. Payment of duty is a q ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... elevant time, clearly laid down that credit of specified duty allowed in respect of any inputs shall not be denied or varied on the ground that part of the inputs is contained in any waste, refuse or by-product arising during the manufacture of final product, whether or not such waste, refuse or by-product is exempted from whole of the duty of excise thereon or is chargeable to nil rate of duty or is specified as a final product under Rule 57A 8. Similar view has been taken by the Tribunal in case of Collector of Central Excise, Chandigarh vs. Maxon India Ltd. 1994 (72) ELT 483 (Tribunal) wherein it is held by the majority decision that the credit of input contained in the waste arising during the manufacture of BOPP film is covered by ..... X X X X Extracts X X X X X X X X Extracts X X X X
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