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TMI Blog2021 (9) TMI 855X X X X Extracts X X X X X X X X Extracts X X X X ..... eared by appellants also to M/s Hindustan Shipyards Ltd (M/s HSL) Visakhapatnam without payment of duty under Notification No. 82/84-CE dated 31/03/1984 and as such duty on this clearance was not paid by the appellants but the appellant is availing CENVAT credit in respect of inputs used in manufacturing final products which are chargeable to duty as well as exempted goods. As such the duty liability of Rs. 3,10,060/- for clearing dissolved acetylene gas valued at Rs. 51,67,664/- to M/s HSL during the period from January 2016 to March 2017 was proposed to be recovered vide Show-cause notice bearing No. 34/2017 dated 22/08/2017 while invoking Rule 6(3) of CENVAT Credit Rules 2004. The said proposal was initially confirmed vide order-in-original bearing No. 01/2018 dated 21/02/2018. The appeal thereof has been rejected vide the aforesaid mentioned order under challenge. 2. I have heard learned counsel Shri A. Sarveswar Rao for the appellant and Shri N. Bhanu Kiran learned A.R. for the Revenue. It is submitted on behalf of the appellant that dissolved acetylene gas is excisable good which attracts central excise duty @ 14% as per central excise tariff under sub- heading 2091-29 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dismissed. 5. After hearing the rival contentions and perusing the appeal record as well as the decisions relied upon by the respective parties, I hold as follows:- The issue involved in the case is regarding reversal of an amount equivalent to 8% or 10% of the value of goods cleared under Notification No. 82/84 to M/s HSL claiming exemption. The said Notification mandates for compliance of procedures laid down in Central Excise (Removal of Goods at Concessional Rate of Duty for Manufacture of Excisable goods) Rules 2001. It is not in dispute that the said procedure has been complied with and the appellant has cleared the non-dissolved acetylene gas to M/s HSL after receiving the certificates. In the given circumstance it has to be adjudicated as to whether provisions of Rule 6 (3) of Cenvat Credit Rules shall be applicable to the present transactions. For that purpose the rule has to be looked into, which is as follows:- "Notwithstanding anything contained in sub-rules (1) and (2), the manufacturer of goods or the provider of output service, opting not to maintain separate accounts, shall follow any one of the following options, as applicable to him, namely:- i) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... other final product which is exempted from payment of duty or chargeable to nil rate of duty and the manufacturer takes credit of the specified duty on any inputs, which is used in manufacture of both the above categories of final products. In such a case, the manufacturer is required to pay a presumptive amount equal to eight per cent of the price of the exempted final product charged by the manufacturer for the sale of such goods at the time of their clearance from the factory." Delhi Bench of this Tribunal also in the case of Auriola Chemicals Ltd Vs CCE Indore (2004(175) ELT 148 (Tri-Del)] has held that the goods cleared by the then appellant i.e. spent sulphuric acid was cleared against CT-3 bond to the fertilizer manufacturer. The sulphuric acid was denied to be called as exempted product or the product chargeable to 'NIL' rate of duty. Provisions of erstwhile Rule 57CC/Rule 6 of CENVAT Credit Rules were not held applicable. The appellant therein was held not required to reverse 10% of the value of the goods cleared. The similar decision has been followed by the Mumbai Bench of the Tribunal in the case of Dharmsi Morarji Chemical Co. Ltd reported at [2010( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of duty under Notification No 6/2000 due to which it was held in that case that once the product is exempted from payment of duty, question of remission of duty under chapter X of Central Excise Rules may not arise. Apparently this is also not the fact of the present case. Dissolved acetylene gas is not provided any exemption from duty. Apparently and admitted the appellant is clearing the said product on payment of duty @14% except for M/s HSL. Hence the peculiar and distinguished fact of the present case is that it was not the manufactured gas which was subject to exemption but M/s HSL was entitled to exemption while buying said excisable product. 8. Finally coming to the recent decision of this Tribunal dated 03/06/2019 wherein the contentions of the department have been considered and applicability of Rule-6 upon the appellant clearing the dissolved acetylene gas without payment of duty to M/s HSL has been allowed. I have perused the decision and it is observed that the findings have been arrived at on the ground that Chapter X Central Excise Rules 1944 stands superseded by Notification No 9/2001 dated 01/03/2001 and hence it was prior to 2001 only that the remission of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d a fresh bond; and may, if the security furnished for a bond is not adequate, demand additional security." Sections 1 & 2 of the Central Excise (Removal of Goods at Concessional Rate of Duty for Manufacture of Excisable Goods) Rules 2001 read as follows: "1) These rules may be called the Central Excise (Removal of Goods at Concessional Rate of Duty for Manufacture of Excisable Goods) Rules 2001. 2) They extend to the whole of India 3) They shall come into force on and from the 1st day of July 2001. 2. Application:- These rules shall apply to a manufacturer who intends to avail of the benefit of a notification issued under sub-section (1) of Section 5A of the Central Excise Act, 1944 (1 of 1944) (hereinafter referred to as the Act) granting exemption of duty to excisable goods (hereinafter referred to as subject goods) when used for the purpose specified in that notification. 3. Application by the manufacturer to obtain the benefit- (1) A manufacturer who intends to receive subject goods for specified use at concessional rate of duty, shall make an application in quadruplicate in the Form at Annexure-I to the jurisdictional Assistant Commis ..... X X X X Extracts X X X X X X X X Extracts X X X X
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