TMI Blog2023 (7) TMI 48X X X X Extracts X X X X X X X X Extracts X X X X ..... e-based drinks was withdrawn and the said goods were subject to duty at the following concessional rates exercisable at the option of the assessee. (a) @1% vide Notification No. 01/2011-CE dated 1.3.2011 subject to condition that no CENVAT credit was taken on the inputs / input services used to manufacture the said goods. (b) @5% vide Notification No. 02/2011-CE dated 1.3.2011 with no restriction as to availment of CENVAT credit on inputs or input services. Although the appellant had opted to pay duty on fruit pulp or fruit juice based drinks at 1% under Notification No. 1/2011-CE, they had initially availed CENVAT credit. However, they have on their own reversed Rs.42,00,866/- being the proportionate CENVAT credit availed on the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the appellant, it was noticed that they have cleared fruit pulp or fruit juice based drinks on payment of effective rate of duty of 1% by availing exemption under Notification No. 1/2011-CE dated 1.3.2011 vide sl. No. 24. As per the said Notification, the effective rate of duty of 1% is applicable only when no CENVAT credit on inputs or input services are availed. Whereas the appellant has availed CENVAT credit on the inputs i.e. sugar and input services viz manpower supply agency services and other common services. Inasmuch as the appellant had availed credit on the inputs and input services, it appeared that the benefit of effective rate of duty of 1% was not available to them and they should have paid duty at the effective rate of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssional rate of duty of 1%. From April 2012 onwards they have stopped availing the concessional rate under Notification No. 1/2011-CE. He has referred to para 10.2 of the impugned order and stated that the learned Commissioner had noted that they had reversed the amount of Rs.42,00,866/-, however, he found that the said reversal does not make them eligible for availment of exemption since they have not reversed the credit in respect of few CENVAT credit inputs such as plastic crates and Brite wash HD plus and that the appellant further continued to avail credit on common inputs till March 2012. He stated that the verification report of the Range Officer dated 15.4.2013 mentioned at para 10.2 of the impugned order had not been supplie ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , no penalty could have been imposed. He referred to the following judgments:- (i) Union of India Vs. Rajasthan Spinning and Weaving Mills Ltd. 2009 (238) ELT 3 (SC) (ii) CCE, Chandigarh Vs. Pepsi Foods Ltd. 2010 (260) ELT 481 (SC) (iii) Continental Foundation Joint Venture Vs. CCE 2007 (216) ELT 177 (SC) (iv) Amrit Foods Vs. Commissioner of Central Excise 2005 (190) ELT 433 (SC) 6. Shri M. Ambe, learned AR has reiterated the points in the impugned order. 7. We have gone through the facts of the case and we find that this is a case in which the appellant had opted for benefit of exemption under Notification No. 1/2011-CE dated 1.3.2011 to discharge duty at 1%. We find that, in the year 2011, vide Union Budg ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n view of the aforesaid clarification by the Department, we see no reason why the assessee cannot make a debit entry in the credit account before removal of the exempted final product. If this debit entry is permissible to be made, credit entry for the duties paid on the inputs utilised in manufacture of the final exempted product will stand deleted in the accounts of the assessee. In such a situation, it cannot be said that the assessee has taken credit for the duty paid on the inputs utilised in the manufacture of the final exempted product under Rule 57A. In other words, the claim for exemption of duty on the disputed goods cannot be denied on the plea that the assessee has taken credit of the duty paid on the inputs used in manufacture ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g period. As the appellant has already reversed the Cenvat credit attributable to the inputs used in the manufacture of the exempted goods, therefore, the demand proposed in the show cause notice is not sustainable. 9. We concur with the opinion rendered in the above said judgment and accordingly find that the appellant was eligible for payment of effective rate of duty of 1% on the fruit pulp or fruit juice based drinks cleared by them, during the impugned period, by availing exemption under Notification No. 1/2011-CE dated 1.3.2011 10. Since the matter has been decided on merits in favour of the appellant, the issue relating to interest and penalty does not survive. Having regard to the discussions as stated above, the impugned ..... X X X X Extracts X X X X X X X X Extracts X X X X
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