1999 (9) TMI 388

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....DR, for the Respondents. [Order]. - Vide the impugned order, Modvat credit of Rs. 2,094.94 has been denied to the appellants on the ground that the capital goods used for manufacture of tools on which no duty is paid, was not admissible. A penalty of Rs. 500.00 has also been imposed. 2. Arguing on the appeal, Shri S.K. Bagaria, learned Advocate submitted that the Revenue's contention....

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....ters around the fact that the Department is considering the said tools as final product whereas the appellants' contention is that the same are in the nature of intermediate goods which are being further used in the manufacture of their final products. Shri Bagaria contended that a similar position in respect of Rule 57D(2) was made clear vide Notification No. l7/95-C.E. (N.T.), dated 18-5-1995 an....

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....inasmuch as the appellants were under no legal obligation to avail the full exemption under Notification No. 67/95-C.E., dated 16-3-1995. Duty paid on the interchangeable tools would again have been taken as Modvat credit and utilised for paying duty on bearings. As such, there being no revenue implication and the entire exercise being revenue neutral, denial of Modvat credit was not justified. ....

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.... films by treating the same as intermediate products, though the same were exempted under Notification No. 67/95-C.E. It was held that in these circumstances, provisions of Rule 57D(2) would come into play and not the provisions of Rule 57C. It was also observed in para 5 of the said Order that the same product may be a final product in respect of a particular goods but the same may be an intermed....