TaxTMI 
TaxTMI 
2007 (2) TMI 40
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....ication No. 23/2004-C.E., dated 9-7-2004, there were stocks of inputs as such and of final product in their factory and Cenvat credit of the duty paid on the inputs present in stock and on the inputs contained in the final product present in stock had already been taken. The credits so taken on inputs lying as such in stock as on 9-7-2004 and on inputs contained in the finished tractors lying in stock as on that date were to the extents of Rs. 2,39,29,898/- and Rs. 2,02,72,473/- respectively. According to the department, these credits were liable to be reversed by the appellants as their final product was cleared on and after 9- 7-2004 at 'Nil' rate of duty under the above Notification. Therefore, a show-cause notice dated 6-5-2005 was issu....
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....ock as on 9-7-2004 and the inputs contained in the finished tractors lying in stock as on that date. 3. Learned Counsel submitted that the above issue was already covered in favour of the appellants by Final Order No. 2103/2006 dated 23-11-2006 [2007 (210) E.L.T. 571 (Tribunal)] passed by the South Zonal Bench, Bangalore in Appeal No. E/418/2005 (M/s. Tafe Ltd. (Tractor Division) v. CCE, B'lore). Ld. Counsel also relied on the Tribunal's Larger Bench decision in the case of CCE, Rajkot v. Ashok Iron & Steel Fabricators, 2002 (140) E.L.T. 277 (Tri. - LB). Reliance was also placed on the Apex Court's judgment in Collector v. Dai Ichi Karkaria Ltd., 1999 (112) E.L.T. 353 (S.C.), which had been followed by the Tribunal's Larger Bench in Asho....
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....view taken in Final Order No. 2103/06 ibid on the basis of Dai Ichi Ksrkaria (supra) was erroneous. Ld. SDR urged that the view taken by the Tribunal in Albert David (supra) be followed in the present case. She pointed out that the said decision had been followed by the Tribunal in the cases of CCE, Ghaziabad v. Explicit Trading & Marketing (I Ltd., 2004 (169) E.L.T. 205 (Tri. - Del.), Sunsui India Ltd. v. CCE, Jaipur, 2004 (170) E.L.T.459 (Tri. - Del) and CCE, Indore v. Ives Drugs (I) Pvt. Ltd., 2005 (191) E.L.T. 639 (Tri. - Del.). 5. In his rejoinder, learned Counsel sought to distinguish the cases of Albert David (supra), Ives Drugs (supra) etc., by submitting that the question of utilization of credit had not been considered in any o....
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....successor-Rule 57AD. These rules mandated that no credit of duty paid on input would be allowed if the final product was exempt from the whole of the duty of excise leviable thereon or chargeable to 'Nil' rate of duty. In the case of Dai Ichi Karkaria (supra), the Hon'ble Supreme Court examined the Modvat Rules including Rule 57C and held as under "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 ....
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.... Albert David Ltd. (supra) after distinguishing the case of Ashok Iron & Steel Fabricators (supra) stood affirmed by the Apex Court when the civil appeal filed against it by the party was dismissed by the court. The review petition filed by the party was also dismissed by the court in an order reading as follows: "Delay condoned. We have gone through the review petition and the connected records. We do not find any merit therein. The review petition is, therefore, dismissed." Applying the doctrine of merger, we find that the view taken in Albert David case having the stamp of approval of the Apex Court, has binding effect. In Albert David case, Cenvat credit had been taken by the party when their final products (I.V. fluids) were c....
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.... affirmed by the Apex Court, requires to be followed in the present case and, accordingly, we hold that the credit taken by the appellants on the inputs lying in stock as on 9-7-2004 is liable to be reversed if unutilized and to be recovered if utilized. 8. The same logic is applicable to inputs contained in the final products lying in stock as on 9-7-2004 also as held by the Tribunal in the cases of Explicit Trading & Marketing (supra), Sunsui India (supra) and Ives Drugs (supra). Accordingly, it is held that the credit taken on the input contained in the final product lying in stock as on 9-7-2004 is also liable to be reversed if unutilized and to be recovered if utilized. 9. On the above basis, the demand raised by the Commissioner....