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of <h1>Tribunal rules against Revenue in duty credit case, citing specific customs duty exemption rule.</h1> The Tribunal ruled in favor of the Revenue, setting aside the Order-in-Appeal and allowing the appeal. It was determined that since the Additional duty of ... Cenvat/Modvat Issues:1. Disallowance of Modvat credit wrongly availed by a company.2. Interpretation of Notification No. 5/94-C.E. regarding Modvat credit eligibility.3. Dispute over duty paid by 100% EOU and credit restriction.Issue 1: Disallowance of Modvat credit:The case involved M/s. Perry Polymers Pvt. Ltd. wrongly availing Modvat credit during a specific period. The Additional Commissioner of Central Excise disallowed a portion of the credit taken by the company, imposed a penalty, and allowed credit on certain grounds. The Revenue filed an appeal against this decision.Issue 2: Interpretation of Notification No. 5/94-C.E.:The main contention revolved around the interpretation of Notification No. 5/94-C.E. and whether the Modvat credit of a specific amount was wrongly allowed. The Commissioner (Appeals) considered the submissions made by the Revenue and relied on a previous Tribunal decision to reject the appeal filed by the Department.Issue 3: Dispute over duty paid by 100% EOU:There was a dispute over the duty paid by M/s. Mica Trading Corporation Limited, a 100% EOU, on the Mica paper purchased by the Respondents. The Revenue argued that the duty paid did not qualify as Additional duty leviable on like goods under the Customs Tariff Act, making the Modvat credit inapplicable. The Respondents, however, relied on a previous Larger Bench decision to support their case.The Tribunal carefully considered the arguments presented by both sides. It was noted that the duty paid by the 100% EOU was only Central Excise duty equivalent to 50% of the Basic Customs duty, with no other duties paid. The Tribunal referred to Notification No. 5/94-C.E. and the method outlined by the Larger Bench to determine the Modvat credit eligibility. Ultimately, it was concluded that since the Additional duty of Customs leviable on the goods imported was NIL, the Respondents were not entitled to any credit of the duty paid by the 100% EOU. As a result, the Order-in-Appeal was set aside, and the appeal of the Revenue was allowed.
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