2000 (5) TMI 382

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....f additional excise duty paid on unprocessed tyrecord fabrics by the appellants. 2.  Heard Shri V. Lakshmikumaran and Shri Parthasarathy, ld. Advocates for the appellants and Shri S. Kannan, ld. DR. 3. Briefly the dispute arises out of the factual situation that the appellants manufacture, inter alia, unprocessed tyrecord fabrics (grey). Since normally they captively consume the same in the manufacture of dipped tyrecord fabrics, they take the said grey fabrics as an input for this process and take credit of the duty paid under Rule 57A of the Modvat scheme. 4.  The appellants also purchase such duty paid grey fabrics from the market which they also normally use in the manufacture of dipped tyrecord fabrics and on these in....

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....ates the order impugned and in particular, the following paragraph in page 7 thereof :- "The procedure adopted by M/s. SRF is to pay AED on the unprocessed tyrecord fabric and to take credit of the same immediately. Thereafter they utilize the credit of AED paid on unprocessed tyrecord fabrics for payment of AED on the same goods cleared for home consumption. They are thus paying no additional excise duty on the unprocessed tyrecord fabric. This is not the intention of the Modvat scheme at all as already explained. Under the scheme the input and final product should be subjected to duty and then only the credit of input is given back to the assessee. In this case, the input virtually does not suffer any excise duty at all and therefore the....