2011 (3) TMI 1596

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....les 57AD of the Central Excise Rules, 1944? (ii) Whether the CESTAT has committed an error in deciding the appeal relying upon the decision of the Larger Bench of the Tribunal more particularly against the said decision, the department has preferred SLP, wherein the leave has been granted ? 2. Though notice for final disposal was issued previously and duly served on the respondents, no one has appeared. We have heard learned counsel for Shri R.J.Oza for the Revenue and perused the orders on record. The issue pertains to reversal of Modvat credit filed by the respondent assessee in the input, namely, furnace oil, which was utilized in manufacturing of exempted goods. After issuance of show cause notice the adjudicating authority rul....

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....oods. Rule 57AD(2) of erstwhile Central Excise Rules, 1944- Rule 6 of Cenvat Credit Rules, 2002." 8/- This decision, being a very recent decision, will have to be given precedence over the older cases cited by the respondent. 9/- In the light of the above discussion, the Central Excise duty of Rs. 1,79,165/- is rightly and legally recoverable from the respondent and accordingly, I set aside the impugned order and allow the appeal filed by the department." 3. Respondent challenged the decision of the Commissioner(Appeals) before the Tribunal. The Tribunal, by impugned order, allowed the appeal reversing the order of the Commissioner. Relying on the decision of the larger Bench of the Tribunal in the case of Commissioner of Gujarat N....

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.... allowed the Revenue's appeal. 5. Upon perusal of the orders on record, as we well as the judgment of the Apex Court in the case of Commissioner of C.Ex.vs. Gujarat Narmada Fertilizers Co.Ltd (supra), we are convinced that the issues arising in the present appeal are squarely covered by the said decision, which reads as under:- "10. In our view, sub-rule(1) is plenary. It restates a principle, namely, that CENVAT credit for duty paid on inputs used in the manufacture of exempted final products is not allowable. This principle is in-built in the very structure of the CENVAT scheme. Sub-rule(1), therefore, merely highlights that principle, Sub-rule(1) covers all inputs, including fuel, whereas sub-rule(2) refers to non-fuel-inputs. ....