TMI Blog2008 (4) TMI 281X X X X Extracts X X X X X X X X Extracts X X X X ..... abh Sancheti for V.K. Mathur, for the Respondent [Order] - This is a petition under Section 35H of the Central Excise Act by the assessee, on the following question framed in the application :- "Whether the substantive benefit of exemption can be denied for procedural irregularities?" 2. The necessary facts are, that the petitioner is a manufacturer of aerated water. The manufacturer used to manufacture aerated water in two brands; one being Campa, and another being Mr. Dik Soda. Out of the two products, the product manufactured in the name of Campa is excisable. However, the product in the name of Mr. Dik is not excisable, being covered by exemption notification. 3. The controversy involved in the present case arose in the c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the matter of Chandrapur Magnet Wires (P) Ltd. v.Collector of C. Excise, Nagpur, reported in 1996 (81) E.L.T.3 (S.C.) Page 3. This reliance was placed before the learned Commissioner, so also the learned Tribunal, and also before us. 8. Learned Tribunal found, that in Chandrapur Magnet Wire's Case, the Hon'ble Supreme Court considered the case of an SSI unit, which availed the benefit of SSI exemption, in respect of final product after reversing the input-credit, which they had earlier taken. In the instant case, the reversal of input-credit was, admittedly, made after clearance of the final product, under the exemption notification, and therefore, it was found, that ratio in Chandrapur Magnet case is not applicable to the instant c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in that case, it was found as a fact that the credit was reversed before clearance of the goods, the appeal of the assessee was allowed. In the present case also, so far the legal proposition, about the appellant's entitlement to exemption from payment of duty on exempted goods is concerned, on that there is no dispute, inasmuch as the appellant cannot be made liable to pay the excise duty on exempted goods, simply because he has availed Modvat Credit. But the question here precisely is, as to whether the appellant is entitled to retain the Modvat Credit already availed by him on such inputs consumed in production of such exempted goods? 12. In our view, the proviso contained in para 3 of the said notification, as referred to above, is ..... X X X X Extracts X X X X X X X X Extracts X X X X
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