TaxTMI 
TaxTMI 
2010 (12) TMI 265
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.... of the duty paid on inputs and capital goods under the provisions of Central Excise Rules, 1944. In the year 1995, they sought conversion of the DTA unit into 100% EOU and the conversion unit 100% EOU was allowed by the Development Commissioner w.e.f. 12/6/95. On12/6/95, the appellant were having capital goods Modvat credit balance of Rs. 10,31,285/- in their RG-23C Pt. II register, which was the credit in respect of capital goods received during the period when it was working as a normal DTA unit. Some of the capital goods were transferred to their sister unit in DTA vide invoice No. 99 dated 27/11/95 and No. 101 dated 26/12/95 and at the time of removal of the goods from the EOU, the duty was paid by debiting RG-23C account. The Departme....
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....y central excise duty in respect of the goods manufactured by it and cleared into DTA by following the procedure prescribed under Rule 100A to 100H of the Central Excise Rules and the Central Excise Duty on DTA clearances is liable to be paid as per the proviso to Section 3 (1) of the Central Excise Act, 1944, that there is no provision for charging duty on the goods which were not manufactured by the EOU or which had not been received without payment of duty, that there is no other obligation on a 100% EOU to pay the duty in respect of inputs or capital goods removed by the unit except under Notification No. 1/95-CE and 13/81-CUS dated 9/2/81, that an EOU was liable to pay duty on the inputs and capital goods received without payment of ex....
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....on removal of the capital goods to their sister unit and that in view of this, the duty on the removal of capital goods to their sister unit should have been paid in cash. 3. We have carefully considered the submissions from both the sides and perused the records. 4. There is no dispute about the fact that the capital goods, in question, had been received by the appellant in the year 1995 when they were functioning as DTA unit and at that time the capital goods Modvat credit has been taken. The appellants unit got converted into a 100% EOU w.e.f.12/6/95and some of the capital goods were removed to their sister unit in DTA in November 1995. The appellant upon removal of the capital goods reversed the credit Modvat credit taken in respect o....