TaxTMI 
TaxTMI 
2006 (1) TMI 20
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..... The appellants made an application for remission of duty on these unmarketable excisable goods. The Office of the Commissioner of Customs & Central Excise, Bhopal vide order dated 3-10-05 permitted the remission of duty to appellants and directed them to destroy the finished products by cutting into pieces subject to conditions. The appellants have no difficulty in adhering to two conditions, the only condition by which the appellant is aggrieved is that the office of the Commissioner has directed the appellant to reverse the Cenvat credit availed on the inputs contained in the finished goods on which duty is remission has been granted. Hence, this appeal. 3. The Ld. Advocate appearing for the appellants submits that the reliance placed ....
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....ispute that the applicant has sought remission of the duty on the finished products which were unmarketable. The duty remission granted to the appellants on the unmarketable finished goods is according to the provisions of Central Excise Rules. 6. The Commissioner while granting the remission of duty, has directed the appellant to reverse the Cenvat credit of duty paid on inputs contained in the finished products based on the CBEC circular No. 800/33/2004- C.X., dated 1-10-04. The relevant Para No. 3 of the circular is reproduced below: "3. As per Rule 4(1) of Credit Rules, the credit is taken immediately on receipt of inputs in the factory, Rule 3(3) ibid defines utilization as to wards payment of duty on final product etc. Remission is ....
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....e in the present case before me. In the present case, the appellants have incurred losses due to non-marketable condition of the finished goods, for which they do not have any adequate compensation. To ask them to reverse the Cenvat credit of the duty paid on the inputs will amount to rub salt on the wound. ". I find that the Tribunal in the case of Inalsa Ltd. (supra) has held as follows: "In the present case also the final product has not suffered duty only as a result of remission of duty given as fulfilling the conditions, therefore under Rule 49 which is not to be equated to a general exemption from duty on the goods being charged to nil rate of duty". To my mind the above ratio of the Tribunal's decision squarely applies in the pre....
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.... of the appellant. The Hon'ble Supreme Court in the case of Dai-Ichi Karkaria Ltd. - 1999 122 E.L.T. 353 (S.C.) has at Para 17 held as follows: "17. It is clear from these Rules, as we read them, that a manufacturer obtains credit for the excise duty paid on raw material to be used by him in the production of an excisable product immediately it makes the requisite declaration and obtains an acknowledgement thereof. It is entitled to use the credit at any time thereafter when making payment of excise duty on the excisable product. There is no provision in the Rules which provides for a reversal of the credit by the excise authorities except where it has been illegally or irregularly taken, in which even it stands cancelled or, if utilized,....