2001 (8) TMI 1035

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....der]. -  In the impugned order, the Commissioner (Appeals) held that, "The wool tops are intermediate products and not the final product. The final product being not exempt from payment of duty, credit on High Production Rectilinear worsted Comb PB-31 is admissible and is allowed. As regards the Modvat credit on (TFO) two for one twisting Machine, its function and use as explained by the app....

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....e Department alleged that the appellants had wrongly availed Modvat credit on capital goods, namely, TFO machine and high production rectilinear worsted Comb PB-31. The Assistant Commissioner disallowed Modvat credit and imposed a penalty. The appellant filed an appeal before the Commissioner (Appeals) who held as indicated above. 3. Arguing the case for the Revenue, Shri D.N. Choudhry, ld. ....

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....yarn is exempted from payment of duty under Notfn. No. 8/96, dt. 3-7-96, that Rule 57A/57Q provides that the credit of specified duty paid on the capital goods is not allowed if the capital goods are used for production of final product which is exempt from the whole of duty of excise. Ld. DR submits that the respondents herein did not file a declaration in accordance with the provisions of sub-ru....

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....-12-97, ld. Counsel submits that this decision squarely covers their case insofar as TFO is concerned. 5. On the question of wool top and yarn being exempted products, ld. Counsel submits that the applicants have a composite unit and wool top and yarn are intermediate products. He submits that under Rule 57D it has been specifically provided that the credit shall also not be denied or varied....