TMI Blog2008 (6) TMI 145X X X X Extracts X X X X X X X X Extracts X X X X ..... d K.K. Agarwal, Member (T) S/Shri Ravinder Narain with Vipul Bilwe and Ajay Aggarwal, Advocates, for the Appellant. S/Shri R.B. Tiwari, Jt. CDR and A.K. Saxena, SDR, for the Respondent. [Order per: K.K. Agarwal, Member (T)]. - The brief facts of the case are that the appellants are engaged in the manufacture of tyres, flaps and tubes. During the course of manufacture of tyres an intermediate product viz, dipped tyre cord fabric come into existence which was exempted from Additional Excise Duty (Goods of Special Importance) [AED (GSI)] under Notification No. 28/94-C.E. dated 1-3-94. The appellants were availing this exemption and accordingly were not paying duty up to 1-3-94. However, this Notification was rescinded by Notifica ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e notices were thereafter adjudicated by the Commissioner by his impugned order dated 31-1-2006, who confirmed the duty amounting to Rs. 6,59,36,795/- along with interest and imposed a penalty of Rs. 25 lakhs. The duty so confirmed by the Commissioner was paid by the appellants on 5-6-2006, which as per their contention was paid within three months from the date of receipt of the impugned order by debiting their Cenvat AED (GSI) account as the impugned order of Commissioner dated 31-1-2006 was received by them on 13-3-2006. It is against this order that the appellants have come up in appeal be fore us. 2. Ld. advocate for the appellants submitted that though they still maintain that the dipped tyre cord fabric manufactured by them is no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... while the conclusion of the Commissioner that the respondents were not entitled to the benefit of Notification are correct, the fact still remains that the Tribunal has in a number of matters given an interpretation as understood by the respondent. It, therefore, cannot be said that the respondents could not have taken the view they did. It cannot be said that they could never have concluded that they were entitled to the benefit of Notification. We therefore, feel that this is a case where penalty should not be imposed. We therefore delete the imposition of-penalty on the respondents". In their case, since CESTAT has consistently in their own matter held that AED (GSI) was not payable, the bona fides of view taken by them cannot be doubted ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e reversed the Modvat credit in respect of inputs used in the manufacture of animal drawn vehicle tyres which were exempted from duty but now that duty is being demanded on their interim product i.e. dipped tyre cord fabric, they are entitled to credit of duty in respect of inputs used in the manufacture of dipped tyre cord fabric which in turn is used in the manufacture of animal drawn vehicle tyres and this credit so reversed by them is more than the basic excise duty demanded and therefore no such duty remains to be paid by them. The Commissioner's order is however silent on this aspect. Since the credit reversed by them is more than the duty demanded no further duty is payable by them. 6. Ld. DR however stated that since the leviabi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... anufactured by them were not dutiable. In view of this, following the Apex Court decision, we set aside the penalty imposed on the appellants. As regards interest, if the entire duty has been paid within three months from the date of receipt of the order, the question of charging of interest would not arise. As regards demand of basic excise duty on dipped tyre cord fabric used in the manufacture of animal drawn vehicle tyres, we find that the Commissioner has not given any findings on the plea of the appellants that the credit of duty on inputs used in the manufacture of dipped tyre cord fabric has been reversed by them which amount is more than the duty demanded. The matter is accordingly remanded back to the Commissioner to give specific ..... X X X X Extracts X X X X X X X X Extracts X X X X
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