TaxTMI 
TaxTMI 
2013 (2) TMI 35
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.... which had to be filed within 6 months from the date of assent of the President, as per Section 73(2) of the Finance Act, 2010, when factually the assessee had failed to comply with the condition requisite under the Finance Act, 2010. (iii) Whether the Appellate Tribunal was justified in setting aside the order of the Adjudicating Authority by totally ignoring the law that the assesee having failed to opt for the procedure under the substituted rule 6(3A) of the CENVAT Credit Rules, 2004 with effect from 1.4.2008 (instead debited/ reversed the duty amount based on their own theoretical basis calculation) is not entitled for any relief under the Act. (iv) Whether the Appellate Tribunal having after factually concluded that the assesee had failed to maintain separate accounts in respect of goods used in the manufacture of exempted and dutiable goods was justified in setting aside the Order-in-Original and allowing the appeal. (v) Whether the Appellate Tribunal misdirected itself and thereby fell into an error in setting aside the levy of duty for the period from April 2008 to December 2008 (Rs.1,63,40,443) being 10% of the total price of exempted exercisable goods cleared wi....
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....n inputs under sub-clauses (ii) and (iv) of clause (a) and input services under sub clauses (ii) and (iv) of clause (b). " 3. Sub Rule (3) of Rule 6 of CENVAT Credit Rules provides for the situation wherein the manufactured goods or the provider of output service does not maintain separate accounts. Even in such cases, the Rule provides for payment of duty at a particular percentage and the method of arriving at the amount payable under Clause (ii) of Sub Rule (3) of Rule 6. Sub Rule 3A of Rule 6 reads as follows:- "3A. For determination and payment of amount payable under Clauses (ii) of Sub Rule (3), the manufacturer of goods or the provider of output service shall follow the following procedure and conditions namely:- (a) While exercising this option, the manufacturer of goods or the provider of output service shall intimate in writing to the Superintendent of Central Excise giving the following particulars, namely:- (i) name, address and registration No. of the manufacturer of goods or provider of output service; (ii) date from which the option under this clause is exercised or proposed to be exercised; (iii) description of dutiable goods or taxable ser....
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....ained details upto the manufacture of Dead Burnt Magnesite, accounts for receipt, consumption and inventory of furnace oil was maintained commonly. The process flow chart of each of the manufactured goods, Furnace oil pipe line layout diagram, extract of flow meter readings and furnace oil utilizaton register in respect of Dead Burnt Magnesite, thus revealed that the pattern of accounting of furnace oil was not in accordance with the Rules to show the receipt, consumption and inventory of furnace oil used for the manufacture of exempted goods and for the manufacture of dutiable Ramming Mass and Refractory Bricks. Thus, the Adjudicating Authority came to the conclusion that the accounts were not in conformity with the requirement of Rule 6(2) of the CENVAT Credit Rules. The Adjudicating Authority further pointed out that there was nothing on record to show that the assessee had followed the qualifying procedure and conditions specified under Sub Rule (3A) for payment of amount under clause (ii) of Sub Rule (3) of Rule 6 during the material period. In the light of the finding thus arrived at, in paragraph 8.01, the Adjudicating Authority came to the conclusion that in respect of DBM ....
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....the manufacture of Dead Burnt Magnesite, which is exempted under the provisions of the Act. When the accounts are not maintained in conformity with the requirements of Rule 6(2), the assessee was not entitled to any further enquiry or relief. He pointed out that as per Section 73 of the Finance Act, 2010, new Sub Rule (7) in Rule 6 was given retrospective effect from 10.09.2004 to 31.03.2008 only. The period covered herein is April, 2008 to December, 2008 and the petitioner has not submitted any application within the time. 10. Learned counsel appearing for the assessee, however, pointed out that the amendment merely gave effect to the various judicial pronouncements to the effect that Rule 57C of the Central Excise Rules specifically barred the availment of credit on inputs used in the manufacture of exempted final products. If the manufacturer uses common inputs in the manufacture of dutiable and non-dutiable goods, the manufacturer had to reverse the credit to the extent of inputs used in the manufacture of exempted goods. 11. Rule 57CC obviates the difficulty arising in cases where there was no separate account or where it was not possible to maintain separa....
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.... Rule 6 of the CENVAT Credit Rules, 2004 as published vide notification number G.S.R. 600(E), dated the 10th September, 2004 [23/2004 - CENTRAL EXCISE (N.T.), dated the 10th September 2004]. In the CENVAT Credit Rules, 2004, in rule 6, after sub-rule (6), the following sub-rule shall be inserted, namely :- "(7) Where a dispute relating to adjustment of credit on inputs or input services used in or in relation to exempted final products relating to the period beginning on the 10thday of September, 2004 and ending with the 31st day of March, 2008 (both days inclusive) is pending on the date on which the Finance Bill, 2010 receives the assent of the President, then, notwithstanding anything contained in sub-rules (1) and (2), and clauses (a) and (b) of sub-rule (3), a manufacturer availing CENVAT credit in respect of any inputs or input services and manufacturing final products which are chargeable to duty and also other final products which are exempted goods, may pay an amount equivalent to CENVAT credit attributable to the inputs or input services used in, or in relation to the manufacture of, exempted goods before or after the clearance of such goods: Provided that the ....