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of <h1>Commissioner (Appeals) grants Modvat credit on OTS cans for manufacturing final products, emphasizing timing and dutiability.</h1> The Commissioner (Appeals) ruled in favor of the assessee regarding the grant of Modvat credit on OTS cans used in manufacturing final products. The ... Cenvat/Modvat - Inputs Issues:Grant of Modvat credit on OTS cans used in the manufacture of final products.Analysis:The judgment in question deals with the issue of Modvat credit on OTS cans used in the manufacturing of final products. The Revenue contested the grant of credit, arguing that the final product was exempted. However, the Commissioner (Appeals) upheld the assessees' contention, noting that when the inputs were received, the final product was not exempted. The Commissioner emphasized that the credit cannot be denied when utilized during a period when the final products are dutiable, as per relevant rules and precedents. The Tribunal's decision in CCE, Rajkot v. Ashok Iron & Steel Fabricators was cited, which established that once credit is validly taken, its benefit is available to the manufacturer without any time limitation. This decision was further endorsed by the Apex Court, solidifying the assessees' position. Consequently, the Commissioner (Appeals) ruled in favor of the assessee, leading to the Revenue's dissatisfaction and appeal.In contrast, the learned SDR referenced the judgment in Albert David Ltd. v. CCE, Meerut, where the final product had been exempted before the utilization of inputs, rendering the credit ineligible. However, in the present case, the final goods were not exempted when the inputs were utilized, making the Albert David Ltd. ruling distinguishable. The SDR argued that the Commissioner (Appeals) correctly applied the precedent set by the Tribunal in the Ashok Iron & Steel Fabricators case, which was subsequently affirmed by the Apex Court. Consequently, the SDR contended that there was no merit in the Revenue's appeal, leading to its rejection.In conclusion, the judgment clarifies the principles governing the grant of Modvat credit in situations where final products are exempted after the utilization of inputs. It underscores the importance of timing and applicability of rules in determining the eligibility of such credits, relying on established legal precedents to support the decision in favor of the assessee.
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