1994 (5) TMI 75

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....ent is whether the appellants can avail full exemption of Rs. 15 lakh in respect of sub-heading as provided under Notification No. 175/86 and also can avail Modvat facilities under Rule 57G of Central Excise Rules, 1944 in respect of other item falling under another sub-heading simultaneously. On the issue involved in this case, the citation in favour is Govt. of India, Ministry of Finance (Deptt. of Revenue), Central Board of Excise & Customs, New Delhi, vide their circular No. 38/88 (F. No. 261 /76/11 /87-CX. 8, dated 8-8-1988 have clarified that as long as it can be proved through reasonable accounting system that credit in respect of only those inputs has allowed which are used in the final products chargeable to duty, there should b....

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.....E., dated 1-3-1986 as amended cannot avail Modvat credit facility in respect of certain products and the benefit of duty free clearances under this exemption scheme in respect of certain other products simultaneously. This view of the Department was formed on the basis of interpretation of the notification and Board's clarifications contained in Board's Circular No. 38/88 (F. No. 261/76/11/87-CX. 8) dated 8-8-1988. The Department had contended that in terms of Board's Circular when there are two parallel notifications granting full exemption as also providing effective rate of duty on the same product full exemption and Modvat credit can be availed simultaneously provided separate account is maintained for manufacture of dutiable as well a....

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....ant represented the respondent. Shri. B.D. Bhagat, the Id. JDR, reiterated the pleas put forth by the Department in the grounds of appeal. The ld. Consultant for the respondent submitted that their case is fully covered by the decision of the Tribunal in the case of Swaraj Paint Industries v. CCE reported in 1991 ( 52) E.L.T. 594, in the case of Abilash Rubber Products v. CCE reported in 1991 (56) E.L.T. 168 and in the case of Faridabad Tools Pvt. Ltd. v. CCE reported in 1993 (63) E.L.T. 759. The Department, however, relied on the decisions of the Tribunal in the case reported in 1985 (22) E.L.T. 751, 1985 (22) E.L.T. 212,1988 (36) E.L.T. 346 and 1988 (36) E.L.T. 174 (Tri.) = 1988 (18) ECR 4. 5. Heard the submissions of both sides, perus....

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....castings falling under Heading 8714.00, i.e., they were not claiming both benefits in respect of the same item. As such, in terms of the ratio of the Tribunal's decision in the case of Swaraj Paint Industries v. CCE, Cochin reported in 1991 (52) E.L.T. 594 and in the case of Abilash Rubber Products & Another v. CCE, Hyderabad reported in 1991 (56) E.L.T. 168. The Department should have allowed their request. The Collector (Appeals) has, therefore, erred in rejecting their appeal." The Tribunal further held, "We have considered the submissions of both sides. We find that ld. Counsel is correct. The matters are apparently covered by the two judgments cited by him above. Hence, in view of the ratio thereof we set aside the impugned orders and ....