TaxTMI 
TaxTMI 
2012 (12) TMI 437
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....h fertilizer is exempt from excise duty. The correctness of this view was disputed by the Revenue. 2. Consequently, the Commissioner, Central Excise & Customs, Vadodara-II (hereinafter referred to as 'the Commissioner') issued two notices to the assessee to show cause why cenvat credit wrongly availed by it should not be recovered under Rule 12 of the Cenvat Credit Rules, 2002 (hereinafter referred to as Rules) read with Section 11A of the Central Excise Act, 1944. The assessee was also required to show cause why interest be not recovered on the wrongly availed cenvat credit and why penalty be not imposed on it. 3. The first show cause notice issued to the assessee was dated 8th March 2004 and pertained to the period 31st Ma....
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....e issue raised by the assessee was fully covered in its favour by a decision of the Tribunal in Gujarat Narmada Fertilizers Co. Ltd. v. Commissioner of Central Excise, Vadodara, 2004 (176) ELT 200 (Tri. - Mumbai) against which the Revenue's appeal before the Gujarat High Court was dismissed since no substantial question of law arose. The decision of the Gujarat High Court is Commissioner of Central Excise and Customs v. Gujarat Narmada Fertilizers Co. Ltd., 2006 (193) ELT 136 (Gujarat). 7. The Tribunal was, therefore, of the opinion that the issue was no longer res integra and the decision earlier rendered by the Tribunal was binding upon the parties. The reference made to the larger Bench was then answered in the following terms:- ....
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....which is used in the manufacture of exempted goods, except in the circumstances mentioned in sub-rule (2). Provided xxx xxx xxx (2) Where a manufacturer avails of CENVAT credit in respect of any inputs, except inputs intended to be used as fuel, and manufactures such final products which are chargeable to duty as well as exempted goods, then, the manufacturer shall maintain separate accounts for receipt, consumption and inventory of inputs meant for use in the manufacture of dutiable final products and the quantity of inputs meant for use in the manufacture of exempted goods and take CENVAT credit only on that quantity of inputs which is intended for use in the manufacture of dutiable goods." 11. This Court was of th....
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....mada. It was submitted that the orders impugned in these appeals were dependent upon the order passed by the larger Bench of the Tribunal on 27th December 2006/4th January 2007. The decision of the larger Bench having been set aside by this Court in Gujarat Narmada the substratum of the case of the assessee is wiped out. 15. On the other hand, the submission of learned counsel for the assessee was that the issue whether LSHS is an "input" as defined in Rule 2(g) of the Rules is debatable. According to the assessee, it should be given a wide meaning, but in Maruti Suzuki Ltd. v. Commissioner of Central Excise, Delhi-III (2009) 9 SCC 193 this Court gave "input" a restrictive meaning. The correctness of this view was doubted in Ramala....
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.... defined in Rule 2(g) of the Rules may be given a broad interpretation and that LSHS utilized by the assessee is an input for the manufacture of fertilizer exempted from duty. The second step, namely, entitlement to cenvat credit does not necessarily follow even if the first step is decided in favour of the assessee. There was, therefore, no necessity of referring these appeals to a larger Bench of this Court and the case was fully covered in favour of the Revenue in view of Gujarat Narmada. Our view: 19. There is an apparent conflict between GSFCL and Gujarat Narmada. 20. In GSFCL a view has been taken that modvat credit can be taken on LSHS used in the manufacture of fertilizer exempt from duty. Although this decision was....