2016 (11) TMI 991

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....ture of DTY. The appellants were paying NCCD on the POY consumed captively and were availing credit of the same. The said credit was used to pay NCCD on the FDY manufactured by them from the POY consumed captively. Notification No.46/2000-CE dated 17/05/2003 exempted DTY from the NCCD. A demand notice was issued seeking to recover an amount equivalent to Rs. 19,19,855/- in terms of Rule 14 of the Cenvat Credit Rules read with Section 11A of the CEA, 1944 along with interest on allegedly wrong availment of credit. It was observed that since DTY is exempted from payment of NCCD by virtue of exemption Notification No. 46/2000-CE dated 17/05/2003, the appellants were not entitled to avail credit of NCCD paid on POY consumed captively for manufa....

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....e distinguishable. In Silvasssa Industries case, the dispute related to credit of NCCD taken on input (POY) used in the production of finished goods, which were exported. In that context, it was held that if the finished product is exported, the appellant would be entitled to take NCCD credit and get a refund of the same, as export goods are not exempted goods. Similarly, in the SRF case, the issue for consideration was whether the credit of AED paid on captively consumed goods, could be utilised for payment of AED on goods cleared for home consumption. The said decision pertained to erstwhile Central Excise Rules, 1944 and Rule 57F(12) provided that notwithstanding anything contained in Rule 57A and Notification issued thereunder, the cred....

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....nd of Cenvat credit so taken. The Tribunal came to the conclusion that Cenvat credit cannot be taken when the inputs are utilised for the manufacture of exempted products. Therefore, this decision of the Tribunal also does not support the case of the respondent. Since none of the decisions relied upon are relevant or applicable, the question of reference to a Larger Bench also does not arise. The lower appellate authority has wrongly relied upon these decisions to come to the conclusion that the respondent is eligible to avail exemption on the basis of duty payment on inputs and also simultaneously take credit on the said inputs, which could be utilised for payment of NCCD on some other inputs cleared as such. This would amount to availing ....