Deemed credit under Notification No. 1/93-CE remained available to a re-roller despite crossing the exemption limit.

Deemed credit under Notification No. 1/93-CE remained available to a re-roller despite clearances crossing the exemption limit and duty being paid at the full rate. The Court construed the scheme and the condition of availing the notification, and followed the earlier view in connected matters as well as the Tribunal's approach, holding that the benefit was not lost merely because the exemption threshold had been exceeded. The deeming credit entitlement was therefore upheld in favour of the assessee and against the department.

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Issues: Whether deemed credit under Notification No. 1/93-CE dated 28.02.1993 was available to a re-roller even after crossing the exemption limit of Rs. 75 lakhs and paying duty at the full rate.

Analysis: The assessee's entitlement turned on the scope of the deemed credit scheme and the condition that the manufacturer should be availing the exemption under the notification. The Court followed the earlier view accepted in connected matters and the Tribunal's approach, holding that the benefit of deemed credit remained available in terms of the notification and the departmental circular/order, and was not defeated merely because the clearances had crossed the exemption limit.

Conclusion: The question was answered against the department and in favour of the assessee. The deemed credit benefit was held to be admissible.

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