TaxTMI 
TaxTMI 
2013 (9) TMI 279
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....,478/- along with interest and penalty on the appellant. 2. Briefly stated relevant facts for disposal of appeals are that the appellant is engaged in the manufacture of disposable IV Cannule of different types falling under Chapter Heading No. 9018.00 of the Central Excise Tariff Act, 1985. 3. The appellant was availing benefit of Notification No. 10/2002-C.E., dated 1-3-2002 and paying Central Excise duty @ 4% on the value of their final product without availing benefit of Cenvat credit till 28-2-2003. Under that Notification an assessee was allowed to clear his final product @ 4% ad valorem provided no Cenvat credit in respect of inputs gone in the manufacture of final product is availed. This benefit was however withdrawn with eff....
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....g the parties dismissed the appeals by a common order dated 13-5-2005 and confirmed the demands. It is against this order of Commissioner (Appeals) the appellant has preferred these appeals. 8. Shri R.C. Choudhary, ld. Advocate for the appellant, has contended that the impugned order-in-appeal is not sustainable as it has been passed in total disregard of the erstwhile Cenvat Credit Rules, 2002. Expanding on the argument, ld. Counsel for the appellant submitted that the Cenvat credit has been denied to the appellant on incorrect reading of Rule 3(2) of Cenvat Credit Rules, 2002 ignoring the fact that admittedly, the stock of inputs available with the appellant including in process inputs and the inputs contained in the final product lyin....
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....nvat credit on the inputs lying in stock, or in process or inputs contained in the final product lying in stock as on 1-3-2003. 11. We find it difficult to agree with the aforesaid conclusion of the authorities below. Perusal of Notification No. 10/2002-C.E., dated 1-3-2002 would show that it starts with the following language :- "In exercise of the powers conferred by sub-section (1) of section 5A of the Central Excise Act, 1944 (1 of 1944), the Central Government, being satisfied that it is necessary in the public interest so to do, hereby exempts excisable goods of the description specified in column (3) of the Table below and falling within the Chapter, heading No. or sub-heading No. of the First Schedule to the Central Excise Tar....
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.... case may be, and the price is the sole consideration for such sale. Explanation III. - For the purposes of this notification, the rates specified in column (4) of the said Table are ad valorem rates, unless otherwise specified." 12. On bare reading of the above, it is evident that this notification is an exemption notification whereby the excise duty on the final product i.e. IV Cannule has been exempted to the extent of duty of excise leviable on the final product of the appellant under the First Schedule of Central Excise Act as in excess of 4% ad valorem specified in the corresponding entry in the notification in respect of the medical equipment and other goods specified in list-I annexed to the notification which also specifies d....
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....ome excisable." 14. Otherwise also the case of the appellant is squarely covered under Rule 3(1) of Cenvat Credit Rules, 2002 which provides that a manufacturer or producer of final product shall be allowed to take Cenvat credit of the excise duty paid on the inputs received in the factory on or after 1-3-2002 provided such inputs are used in the manufacture of the final product subject to excise duty. It is not the case of the revenue that the inputs in question are not duty paid or that those were received in the factory of the appellant prior to 1-3-2002. It is also not the case of the revenue that the relevant duty paid inputs were not used for or any manufacture of the excisable final product of the appellant. Therefore, in our view....