2016 (3) TMI 200

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.....M. Blended yarn liable to central excise duty. They were clearing the final products to domestic market as well as for export. They were procuring fibre for production of yarn for export availing notification no.43/2001-CE (NT) dated 26.06.2001. Some portion of such non-duty paid procurement could not be used for the intended purpose and hence, the appellants discharged the duty on the said fibre. They utilized cenvat credit available in their books to discharge such duty. They have used the fibre for further manufacture and clearance of final products on payment of duty. The duty paid on the fibre (as they could not be used for intended purposes) was again availed as credit and used for discharging duty on final products. The department r....

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....hat in a similar set of facts, the appellants can discharge duty using cenvat credit and the said payment can again be availed as a credit for discharging duty on the final products. 3. Ld. AR supports the findings of the Original Authority as well as Appellate Authority and submitted that duty on fibre procured without payment of duty cannot be discharged using the cenvat credit account. He drew our attention to the findings of the Original Authority on the analysis of Rule 3 of Cenvat Credit Rules, which stipulate the usage of credit availed for discharging various types of duties. It is the case of the Revenue that the input procured on concession without payment of duty which is not used for intended purpose, has to discharge duty an....