TaxTMI 
TaxTMI 
2010 (4) TMI 390
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.... were either lying in the store or contained in the goods in the manufacturing process or contained in the finished goods in stock. 2. It is the case of the appellants that in March 2005, they had already reversed, under protest, the credit of Rs. 3 crore which was earned prior to 10-1-2005 and which was not utilized prior to 1-1-2005, and as regards the inputs in the stock, on that day, the credit taken in respect of duty paid thereon, the same was already utilized prior to 10-1-2005, and therefore the same could not be denied to them, nor can be ordered to be reversed. 3. It is the case of the department that as per the Cenvat Credit Rules, the credit in respect of the duty paid on the inputs is admissible provided it is availed and utilized in or in relation to the manufacture of final goods which are not exempt from payment of duty. Therefore, a show cause notice dated 21-11-2005 came to be issued to the appellants in relation to such stock of inputs available with them on which cenvat credit of Rs. 7,69,52,504/- was sought to be wrongly availed. 4. The Commissioner at Chandigarh by his order dated 17-11-2006 confirmed the demand of Rs. 7,69,52,504/- alongwith interest....
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.... CCE reported in 1996 (87) E.L.T. 593 (S.C.), Sourashtra Chemicals reported in 2007 (212) E.L.T. 7 (S.C.) clarified in 2008 (221) E.L.T. 118 (S.C.), Hindustan Zinc Ltd. v. CCE reported in 2008 (223) E.L.T. 149 (Raj.), CCE v. Saboo Alloys Pvt. Ltd., reported in 2010 (249) E.L.T. 519 (H.P.), TAFE Limited (Tractor Division) v. CCE, Bangalore reported in 2007 (210) E.L.T. 571, CCE v. CNC Commercial Ltd., reported in 2008 (224) E.L.T. 239 (P & H), CCE v. United Vanaspati Ltd., reported in 2010 (251) E.L.T. 373 (HP) = 2009 TIOL 723 (HP) unreported decision in the matter of CCE, Chandigarh v. Purval and Associates Limited dated 5-5-2009 and in CCE, Chandigarh v. M/s. P.A. Precision Components Limited dated 15-5-2009. It is further contended on behalf of the appellants that even though the decision in Ashok Iron case was rendered in the context of the provisions of Central Excise Rules, 1944 as amended in April 2000, the ratio is squarely applicable to the cases under Cenvat Credit Rules since the provisions of law on the subject which were in force and applicable prior to April 2000 were in pari materia with the provisions of Cenvat Credit Rules, 2002. While referring to Rule 57C and 57CC....
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....ation No. 50/2003-C.E. Under Rule 18, the Central Government has issued Notification No. 21/2004-C.E. (N.T.) dated 6th December 2004 in which the procedure for rebate of excise duty paid on inputs used in the manufacture of export goods has been prescribed. Further Para 1.2 of Part V of Chapter 8 of the CBEC Manual of Supplementary Instructions clarifies that for grant of rebate of excise duty paid on inputs used in the manufacture of export goods, such export goods include dutiable or exempted as well as non excisable goods. Hence, the appellants are also entitled for such rebate. 8. Lastly, it is the contention on behalf of the appellants that the quantum of duty confirmed under the impugned order is incorrect. It has been held that the credit deniable on the raw materials was Rs. 5,17,06,612/-, on packing materials was Rs. 1,35,25,716.00 paise, on goods in process was Rs. 41,45,602.25 paise and on finished goods was Rs. 80,84,574.85 paise, totaling to Rs. 7,74,62,505.10 paise. The appellants did not avail the credit of Rs. 172,62,167.92 paise for the inputs during the period from 1st January to 10th January of 2005. Therefore, net credit on inputs lying in stock was Rs. 6,02,....
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....e or otherwise unless the manufacturer itself chooses not to use the raw material in its excisable product". 10. It is further submitted by the learned DR that the fact that the issue is no more res integra cannot be disputed but the same is not on account of Larger Bench decision in Ashok Iron case or HMT case but on account of the decisions by the Supreme Court in Maruti Suzuki read with the decision in Gujarat Narmada Fertilizers Co. Ltd., and Ichalkaranji Machine Centre Private Ltd. v. CCE, Pune reported in 2004 (174) E.L.T. 417 case as well as of the Allahabad High Court decision in Super Cassettes case. 11. While disputing the contention regarding absence of machinery provision, it is submitted by the learned DR that the demand has been raised and confirmed under Rule 14 of the Cenvat Credit Rules and Section 11A/11AB of the Central Excise Act. The provisions of law comprised under Section 5B of the said Act though were added to the statute later on, the same are to be read in proper perspective. The same relate to the issue of ion reversal of the credit. It is further contention on behalf of the Respondent that the appellants are not entitled for benefit of Rules 6(6)(....
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....ble goods should not escape duty and at the same time by providing credit facility, the cascading effect of excise duty on the goods is limited. 13. Upon hearing at length the learned Advocates and the representatives for the parties and on perusal of the records placed before us, the following points arise for our consideration :- (i) Whether the cenvat credit availed on the inputs being in stock on the day the assessee opts for exemption from payment of duty under Notification No. 50/03 dated 10-6-2003 is required to be reversed? (ii) Whether the above issue already stands answered and concluded by the decisions of the Larger Bench in Ashok Iron and HMT cases? (iii) Whether an exemption notification should specifically provide for non availability of cenvat credit facility in relation to the duty paid on inputs which are to be utilized in the goods availing the exemption benefit under such notification? (iv) Whether the goods cleared for export under bond cannot be considered as the exempted goods, and tha....
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....ure of the credit for excise duty paid on raw material was explained by the Apex Court in Dai Ichi Karkaria case in para 17 of its decision. Further, the Larger Bench while observing that the decisions in the matter of CCE, Meerut v. Modi Rubber reported in 2001 (133) E.L.T. 515 (S.C.), CCE, Jaipur v. Raghuvar (India) Ltd., reported in 2000 (118) E.L.T. 311 (S.C.), Chandrapur Magnet Wires (P) Ltd., (supra), CCE, Vadodara v. Dhiren Chemicals reported in 2002 (139) E.L.T. 3 (S.C.) which were relied upon by the learned DR did not relate to the issue which was referred for the decision, held thus :- "We find that none of these decisions relates to the issue with which we are concerned. We are not informed that a later decision of the Supreme Court has taken a different view from Dai Ichi Karkaria Limited case. In view of the above, we are bound by the dictum laid down by the Supreme Court in Dai Ichi Karkaria Limited. Since the issue is now covered directly by the by a decision of the Apex Court, we found it not necessary to place the matter before a Bench of 7 , Members even though a Bench in 5 Members has taken a contra view in Khanbhai Esoofbhai". In other words, the Larger Be....
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....al product becoming exempt and such credit cannot be recovered under rule 12 of Rules 2002 comprising of Rule 571 and 57AH of the Rules 1944". Having held so, the decision of the Tribunal, in Commissioner v. CNC Commercial Limited reported in 2006 (206) E.L.T. 874, upheld by the Punjab and Haryana High Court in CCE, Chandigarh v. CNC Commercial Limited reported in 2008 (224) E.L.T. 239, Commissioner of C.Ex. Chandigarh v. Saboo Alloys Private Limited reported in 2008 (228) E.L.T. 422 (Tri. - Del.), Swastik Textile Engineers Private Limited v. CCE, Ahmedabad-I reported in 2007 (214) E.L.T. 198, PSL Limited v. CCE, Visakhapatnam-I reported in 2007 (214) E.L.T. 238 were agreed with and it was held in para 22 of the order that :- "when the input credit legally taken and utilized on the dutiable final products, the same need not be reversed on the final product becoming exempt subsequently, w.e.f. 9-7-2004". Evidently, the proposition which has been laid down by the Larger Bench is to the effect that the credit once availed and utilized lawfully, while the final product was dutiable, then there is no need to reverse such credit on the final product becoming exempted after such ....
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.... scheme, to be utilized against the payment of excise duty or product; manufactured by him, including the intermediate product, as contended by the manufacturer. Before answering the said point, the Apex Court took note of two decisions, one by the Tribunal and another by the Allahabad High Court, those were relied upon by the Revenue. 21. One of the said two decisions was in the matter of Collector, C. Ex. v. Incab Industries reported in 1990 (45) E.L.T. 342 (Tribunal). Therein, the Tribunal had held that under the modvat scheme, a manufacturer was allowed to utilize the duty paid on the inputs by deducting the same from the duty payable on the final product, subject to following the procedure prescribed under the Rules and that the same results in reduction in the cost of final product to the extent of the credit but does not automatically reduce the assessable value which is to be determined in accordance with the provisions of Section 4 of the said Act. 22. The second decision was in the matter of Super Cassettes Industries Limited v. Union of India reported in 1997 (94) E.L.T. 302 (All.). Therein, the Allahabad High Court had held that there was no warrant for the view t....
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.... in the case of Eicher Motors Ltd. v. Union of India [1999 (106) E.L.T. 3] this Court said that a credit under the Modvat scheme was "as good as tax paid." 19. With this in mind, we must now determine whether the excise duty paid on the raw material should form part of the cost of the excisable product for the purposes of Section 4(1)(b) of the Act read with Rule 6 of the Valuation Rules?". 26. Complete reading of the entire judgment and in particular para Nos. 15 to 19 of the decision in Dai Ichi Karkaria case, the same discloses that the Hon'ble Supreme Court having noted that but for the modvat scheme and availability of credit in relation to the excise duty paid on raw materials, such excise duty on the raw materials would not have been a factor in determining the cost of the excisable product and proceeded to ascertain the effect of the modvat scheme on the process of determination of assessable value. Evidently, the observations in para 17 of the said judgment were for the purpose of understanding the effect of the credit to be availed and utilized under the modvat scheme on the process of valuation. It was in that regard it was held that there was no correlation betwee....
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....inferential. An inferential finding of facts is the inference which the Judge draws from the direct, or perceptible facts; (ii) statements of the principles of law applicable to the legal problems disclosed by the facts; and (iii) judgment based on the combined effect of the above. A decision is only an authority for what it actually decides. What is of the essence in a decision is its ratio and not every observation found therein nor what logically follows from the various observations made in the judgment. Every judgment must be read as applicable to the particular facts proved, or assumed to be proved, since the generality of the expressions which may be found there is not intended to be exposition of the whole law, but governed and qualified by the particular facts of the case in which such expressions are to be found. It would, therefore, be not profitable to extract a sentence here and there from the judgment and to build upon it because the essence of the decision is its ratio and not every observation found therein. The enunciation of the reason or principle on which a question before a court has been decided is alone binding as a precedent. The concrete decision alone is b....
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....g Corp. cases and applying the same to the decision in Dai Ichi Karkaria case, it would at once be clear that the said decision is not on the point in issue in the case in hand. The decision was essentially in relation to the aspect of valuation and while arriving at the finding in relation to the issue which arose for consideration in the said matter, the Apex Court had taken note of various provisions of law including the provisions relating to the modvat credit scheme and the effect thereof on the aspect of valuation. The decision does not deal with the issue as to whether the credit availed on the inputs used in manufacture of the final product for which the assessee opts for exemption under exemption Notification needs to be reversed or not. No decision can be understood by picking up few sentences or even paras from here and there in the decision. Every word and sentence in a decision has to be read in the context in which it is used. The law in this regard is well settled. 32. It is settled law that one cannot pick and choose one or two sentences from a judgment and label them as the ratio of the decision, ignoring the context in which they are used, nor such sentences ca....
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....". 34. The point which arose before the Apex Court in Dai Ichi's case while dealing with the main issue of valuation was pertaining to the effect of modvat scheme on the process of valuation. Certainly while dealing with any such issue, the observation in para 17 would be binding. But, the same cannot be held to lay down the law relating to a point totally unconnected with the issue and the point dealt with by the Apex Court in the said decision. 35. There cannot be any dispute that there is no one to one relationship between the input on which credit is earned and the final product for which credit so earned is utilized for payment of duty; however, at the same time it cannot be forgotten that the credit can be lawfully earned only on those inputs which are to be used in dutiable and non-exempted final product. This is abundantly clear from Rule 6(1) of the Cenvat Credit Rules, 2004. In fact, the very fact of absence of co-relation between the inputs on which the credit is earned and the final product in respect of which, while paying duty, such credit can be utilized, establishes that till and until the input on which credit is earned is used in or in relation to manufactur....
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.... the goods intended to be removed at any time, and every assessee has to make the actual payment of duty by debiting the said account-current before removal of the goods. Under Rule 9 of the said rules, no excisable goods could be removed from any place where they are produced, cured or manufactured or any premises appurtenant thereto until the excise duty leviable thereon is paid. 37. Referring to the entire modvat scheme as such, the Allahabad High Court in Super Cassettes case held that in the manufacture of goods several inputs have to be used which have suffered the burden of excise duty. The final product being also subjected to excise duty, the excise burden on the final product becomes heavy and in order to give relief, the provisions have been made for adjustment of the excise duty paid on certain inputs from the excise duty payable on the final product. When a manufacturer purchases such inputs on which excise duty has been paid, he can avail the credit according to rules, of the amount of excise duty paid on those inputs and when he removes the manufactured goods, the excise duty payable has to be debited in the said account. The net result would, therefore, be that i....
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....ng to take credit of the duty paid on inputs under Rule 57A. Sub-rule (1) of Rule 57G provides that a manufacturer intending to avail Modvat credit shall file a declaration with the Assistant Collector of Central Excise and after obtaining the acknowledgement thereof take credit of the duty paid on the inputs received by him. The rule obliges the manufacturer to maintain necessary accounts and the manufacturer has to furnish before the superintendent of Central Excise within five days after the close of each month documents evidencing the payment of duty along with extracts of Parts I and II of form RG 23A. Rule 57-I provides for recovery of credit wrongly availed of where credit of duty on inputs has been taken on account of an error, omission or misconstruction, on the part of an officer or a manufacturer. 40. The Allahabad High Court in Super Cassettes case further disapproving the approach of the Tribunal as well as the argument of the Counsel for the assessee that credit once taken in accordance with the aforesaid Rules was final and since Rule 57G does not make any provision for-reversing the credit, the debit entry would be wrong, held that such a view does not get any su....
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....rejecting the contention that when the credit was taken, the final product was not exempt from the excise duty and it is only subsequently that the final product became exempt from the excise duty and that therefore, Rule 57C would not be attracted, it was held in Super Cassettees case that :- "The whole scheme is in respect of excisable goods, and, therefore, if the product is exempted from excise duty from a particular day the modvat credit taken in respect of inputs which are in stock has to be reversed. Even the inputs that have been used in the manufacture of final product which has become exempt from the excise duty, modvat credit in respect of such inputs also becomes inadmissible and will have to be reversed. In my view, there is no warrant for the view that modvat credit once availed by making necessary entries is irrevocable. This would amount to unjust enrichment and cannot be conceived of in the light of the rules on the subject. I am, therefore, of the view that the debit entries made by the petitioners for reversing the modvat credit availed by it were in compliance of its legal obligation and it cannot be said that by making such entries the petitioner has made an....
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....avail credit on the diesel used for such DG sets. The assessee had a common distribution point for electricity generated in turbines as well as DG set. During the disputed period from January 2003 to March 2004, the assessee cleared a part of electricity to its joint ventures, vendors etc. also for manufacture of final products. In addition, the assessee met its electricity requirements by electricity captively generated by the assessee in their turbines. 45. In Maruti Suzuki's case (supra) the Apex Court while dealing with the issue as to whether the Department was right in reversing proportionate cenvat credit to the extent of power wheeled out by the assessee to its sister unit, vendors, joint ventures, and while ascertaining the eligibility of an input for availing the credit in terms of provisions of law, analised the scope of the term "input" under the Cenvat Credit Rules 2002, held that the term input can be divided into three parts namely (i) specific part (ii) inclusive part (iii) place of use. 46. It was further held by the Apex Court that as regards the specific part, the word "input" is defined to mean all goods, except, light diesel oil, high speed diesel oil, an....
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....c. 48. Consequently, mere availability of credit is not an end in itself for claiming benefit under the said rule. The benefit thereunder could be enjoyed provided the credit is not only available but also utilized lawfully in accordance with the provisions of law and as clarified by the Apex Court. This is further clear from the decision of the Hon'ble Supreme Court in Gujarat Narmada Fertilizer case (supra). 49. In Gujarat Narmada Fertilizer case, the issue which arose for consideration was that whether the assessee was required to reverse the cenvat credit in terms of Rule 6(1) of the Cenvat Credit Rules, 2002 on the quantity of LSHS which was used as fuel for producing steam and electricity, which in turn was used in or in relation to the manufacture of exempted goods, namely fertilizers during the period from March 2003 to March 2004. The Commissioner had disallowed the credit claim of the assessee, however, in appeal the matter being referred to Larger Bench, the same was allowed by this Tribunal by its order dated 27-12-2006. The Tribunal followed the judgment of Gujarat High Court in the matter of Commissioner v. Gujarat Narmada Fertilizers Co. Ltd., reported in 2006 ....
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....d that it is not a mere utilization of inputs that satisfies the requirement to enable to claim the benefit of Cenvat Credit scheme. But such utilization of input has necessarily to be in dutiable final product. The law is well settled in that regard. The Apex Court in Amrit Paper (supra) while holding that a notification cannot be given primacy over the statutory provision and taking into consideration the scope of Rule 57C of the Central Excise Rules, 1944 held that "it provides in mandatory and categorical terms that no credit of the specified duty asked on the inputs used in the manufacture of a final product" of the (enumerated categories) shall be allowed if the final product is exempt from the whole of the duty of excise leviable thereon or is chargeable to Nil rate of duty". It was held that the decision in Orissa Extrusions v. CCE, Bhubaneswar reported in 2000 (115) E.L.T. 30 (S.C.) did not lay down the correct position of law and the correct proposition of law was laid down by three Judges Bench of the Apex Court in Ichalkaranji Machine Centre case (supra). 52. In Ichalkaranji Machine Centre case it was held by the Apex Court that modvat was basically a duty collecting....
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....edger books which had to be maintained under the excise rules. The credit amount could be utilized by the manufacturer towards payment of duty of excise leviable on the final products. Since the copper wire manufactured by the manufacturer had become duty free, there was no question of any utilization of the credit amount, against any duty on the copper wire. Moreover, Rule 57C specifically provided that the credit of duty could not be allowed if final products were exempt from payment of excise duty. Faced with that situation, the manufacturer reversed the credit entries of duty paid on inputs which were utilized for manufacture of the duty free copper wires. The Department objected to the reversal of the entries, contending that the assessee was not entitled to remove the copper wires without payment of duty since the credit of duty paid on inputs which were used in manufacture of copper wire had already been taken in accordance with Rule 57A. The contention was that once appropriate entries have been made in the register, there was no rule under which the process could be reversed and since the credit had been taken for the duty paid inputs in the ledger maintained by the assess....
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.... is payable in respect of any final product, the question of availing the cenvat credit does not arise as there is no duty of excise at more than one level. The harmonious reading of rules dealing with cenvat scheme and particularly Rule 57AC and Rule 57AD of the Central Excise Rules 1944 makes it very clear that the cenvat credit shall not be allowed on such quantity of inputs which is used in the manufacture of exempted goods". It was further held that Rule 57AH contains the provision for the recovery of cenvat credit utilized wrongly as the inputs has been utilised in the manufacture of wholly exempted goods credit taken in respect of such inputs is recoverable". It is pertinent to note that the said decision was subjected to appeal being Civil Appeal No. 1852/2003 which came to be dismissed by the Apex Court on 13-3-2003 [vide: Albert David Limited v. J Commissioner - 2003 (157) E.L.T. A81 (S.C.)] and even the review against the said order was dismissed by the Apex Court by order dated 9-9-2003 after condoning the delay while ruling that "we have gone through the review petition and connected records. We do not find any merits therein. The review petition is, therefore, dismiss....
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....mption came into force, there was a stock of inputs in their factory, on which Cenvat credit had been taken. The Tribunal referred to Rule 57AD and held that the credit taken on inputs lying in stock on the date from which the final products were exempt from duty was recoverable from the assessee. It was this view which was upheld by the Supreme Court. The Tribunal, in the case of Albert David (supra), noticed that there was a provision (Rule 57AH) for such recovery. There is no finding of sweeping character in the Apex Court's judgment in Dai Ichi Karkaria (supra) that, at the material time, there was no provision for reversal of Modvat credit. On the other hand, their lordships held thus "there is no provision in the Rules which provides for a reversal of the credit by the excise authorities except where it has been illegally or irregularly taken, in which event it stands cancelled or, if utilized, has to be paid for. Thus the Hon'ble Supreme Court's judgment provides room for reversal of credit illegally or irregularly taken as also for recovery of credit if already utilized. In the appellants' own case, the Bangalore Bench of the Tribunal held, on a similar set of facts, that t....
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....Tribunal vide : - CIT v. Godavaridevi Saraf [1978 (2) E.L.T. (J.624) (Bombay)]; - Amritlal Lalubhai v. Collector [1985 (21) E.L.T. 908 (Tribunal]; - Associated Cement Co. Ltd. v. Collector [1987 (27) E.L.T. 746 [Tribunal]; - Collector v. Mansingker Bros. [1988 (38) E.L.T. 105 (Tribunal)]; - Collector v. United Glass [1987 (31) E.L.T. 786 (Tribunal)]; and - Collector v. Stallion Shox Ltd. [1996 (85) E.L.T. 139 (Tribunal)] It is common ground between the parties that the only High Court decision directly on the issue raised in these Reference applications is the Allahabad High Court judgment, referred to above. Respectfully following the above judgment of the Allahabad High Court, we hold as under :- -Credit taken/utilized in respect of inputs:- (a) used in the manufacture of; exempted final products lying in stock or in the process of being used in manufacturing such final products, and (b) lying in stock in the factory, has to be reversed or recovered, as the case may be. 12. We do not accept the contention of the Ld. Counsel for the assessees that the Allahabad High Court judgment in Super Cassettes Industries Limited, supra, could be considered a ....
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....mpt from duty, whether the credit of duty taken on barley malt (i) lying in stock, (ii) in Horlicks in stock and (iii) in process of manufacture of Horlicks, is liable to be reversed or recovered as the case may be". 58. Perusal of the decision in Raghuvar (India) Limited case (supra), it is apparent that in that case a show cause notice dated 25-8-1999 came to be issued to the assessee alleging that consequent upon the withdrawal of duty on vegetable products, the assessee ought to have reversed the modvat credit taken on the inputs which were still to be converted into finished products and that by not doing so, it had taken the modvat credit with intent to evade duty. After taking note of the decision of earlier Larger Bench in Ashok Iron and observing that in the said decision in Ashok Iron referring to para 17 of the decision of Apex Court in Dai Ichi case, it had taken a view that if credit was taken at a time when the final product was not exempted from duty and it was utilized, a subsequent exemption of the final product would not be a reason for reversal of credit by the Excise authority. Having so observed it was held that :- "in the present case it is admitted that....
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.... the Apex Court in Dai Ichi Karkaria case be correctly applied. With utmost respect, as seen above, the decision in Dai Ichi Karkaria case was in a totally different set of facts and circumstances and did not deal with the issue which was before the Punjab & Haryana High Court in the said decision. 62. In HMM Limited v. Collector of Central Excise, New Delhi reported in 1996 (87) E.L.T. 593, the matter related to the interpretation of Notification No. 210 of 1979-C.E., dated 4-6-1979 issued under Rule 8 of the Central Excise Rules, particularly with reference to point of correlation between inputs and the final products. There was specific finding therein that the rule in force at the relevant time did not disclose need for actual utilization of the inputs in the manufacture of the final product in order to claim the credit of the duty paid on such inputs. It was specifically observed in the said judgment that the exact co-relation of inputs with the manufacture of goods was not contemplated by the rule in force and it was permissible to take credit for duty paid on the inputs and make adjustment thereof against the duty payable on the goods manufactured and cleared by a manufac....
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....s admissible or not, once such final product is declared as exempt from payment of duty, held that the respondent were not entitled to cenvat credit on the inputs in process in manufacture of the final product as well as utilized completely in the production of the final product which stood exempt from the payment of duty w.e.f. the day on which the exemption notification came into force. 66. The contention that in absence of specific provision for lapsing of credit in relation to the inputs lying in the stock on the date of option for exemption relating to the final product would not entitled the department to seek reversal of credit is devoid of substance. Rule 6(1) of the Cenvat Credit Rules clearly specifies circumstances under which the cenvat credit can be availed and utilized. It rules out any occasion for availment and utilization of such credit in any other circumstance and obviously, therefore, if the assessee seeks to avail the credit in contravention of provisions of law, it would be unlawful availment of credit which would be necessarily required to be reversed, otherwise it can result in unjust enrichment to the assessee and fraud on the public exchequer. Unless th....
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....nfer that the statute by implementation empower that detail be carried out". While approving the above quoted rule of statutory construction, the Apex Court in Asst. Collector of Central Excise Calcutta v. National Tobacco Co. of India Ltd., reported in AIR 1972 SC 2563 held that :- "It is a well established rule of construction that a power to do something essential for the purpose and effectual performance of the work which the statute has in contemplation may be implied". 68. In Eicher Motors case, it was a totally different issue and has no application to the matter in hand. Therein by an application of Rule 57F(4A), the credit attributable to the inputs already used in the manufacture of the final products and final products which have already been cleared from the factory was sought to be lapsed, i.e. the amount which was sought to be lapsed related to the inputs already used in the manufacture of the final products. The Apex Court held that the said lapsing was not permissible as "the right to the credit has become absolute at any rate when the input is used in the manufacture of the final product" and since the scheme being altered, it was not to be in force retros....
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....e, a right that is in aid to protection or enforcement of a substantive right. A vested right is one that is so complete and definite and belongs to a person, that it cannot be impaired or deterred away without his or her consent. On the other hand, right which depends upon happening of certain event or on fulfillment of certain condition is nothing but a conditional right, and is always subject to fulfillment of those conditions. 72. The provision in relation to the method of payment of tax and to avoid the cascading effect of the duties payable under taxing statutes do not create any vested right. The provisions of law incorporated in taxing statute or the subordinate legislation in that regard do not give rise to a vested right in favour of assessee. They can only be termed as the existing rights, and such right can be withdrawn at any time, albeit, in accordance with the procedure known to law. It being a scheme evolved to introduce a procedure in relation to the payment of duties for avoiding cascading effect in respect thereof and thereby to have effective reduction in the cost of final product, it does not create any vested right and the Government is not forbidden from b....
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....) in which reliance is placed by the appellant, was based on the decision of the Apex court in Orissa Extrusions case (supra). The Apex Court in Amrit Papers case (supra) has specifically declared that the decision in Orissa Extrusion case does not lay down a correct proposition of law. Being so, it needs no further discussion on this point for rejection thereof. Even otherwise to be noted that availability of cenvat credit depends upon the provisions of law comprised under the Cenvat Credit Rules and they do not stand modified by any exemption notification. 76. The next point relates to the clearances of goods for export under bond. The contention raised by the learned DR that there was absolutely no foundation laid down to raise this point is not correct. In reply to the show cause notice, it was specifically pleaded by the applicant that duty of the total quantity of input which was lying in stock on 10-1-2005, substantial quantity was used for manufacture of export goods and said claim was sought to be made good by referring to certificate issued by Chartered Accountant on 16-2-2006 alongwith copies of invoices and other documents. 77. However, as regards the point regard....
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.... in or in relation to the manufacture of the final goods which were cleared for export under the bond. Needless to say that the appellants will have to establish actual export of such final goods. 79. It is also sought to be canvassed that the appellants are entitled for rebate under Rule 18 of the Central Excise Rules, 2002 in respect of duty paid on the inputs going into the manufacture of goods for export purposes by unit availing area based exemption under the Notification No. 50/2003-C.E. Undoubtedly, as rightly submitted, the Rule 18 of the Central Excise Rule, 2002 provides that where the goods are exported, the Central Government may by notification grant rebate of duty paid on such excisable goods or duty paid on the materials used in the manufacture or processing of such goods and the rebate shall subject to such condition or limitation if any and fulfillment of such procedure as has been specified in the notification. The Rule 18, as observed by the Commissioner, the Central Government had issued Notifications like 19/2004-C.E. (N.T.), dated 6-9-2004 as amended, 20/2004-C.E. (N.T.), dated 6-9-2004 as amended and 21/2004-C.E. (N.T.) dated 6-9-2004 as amended lay down p....