TaxTMI 
TaxTMI 
2017 (1) TMI 606
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....ch includes manufacture, supply, delivery, lowering, laying, jointing and testing and maintenance of pipelines. They availed exemption under Notification No. 6/2002-CE dated 01.03.2002 as amended by Notification No. 47/2002-CE dated 06.09.2002. In view of the said Notification, the appellants cleared pipes needed for water treatment plants at nil rate of duty. With respect to other pipes they cleared at the rate of 16% advalorem. 2. Though the appellants used common inputs for manufacture of both dutiable and exempted pipes were not maintaining separate accounts. As per Rule 6(3) (b) of the CENVAT Credit Rules 2002, the appellants are required to pay an amount of 8% /10% of the price of the exempted final prod....
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....roviso to Section 11A(1) and 11AB of the Central Excise Act, 1944; ii) penalty should not be imposed on them under Rule 13/ Rule 15 of the CENVAT Credit Rules, 2002/2004 read with Section 11AC of Central Excise Act, 1944. After due process of law, the original authority confirmed the demand of Rs. 42,14,889/- along with interest and imposed equal amount of penalty. The appellant is thus before the Tribunal. 3. On behalf of the appellant, the Ld. Counsel Shri. Sudhinder argued on the ground of limitation. He submitted that the appellant had been filing ER-1 returns, where in the appellant had disclosed the amount paid in terms of Rule 6(3) (b) along with other....
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....appellant company was under the bonafide belief that the amount payable under Rule 6(3) (b) is to be arrived after deducting the excise duty paid on the inputs. 4. On behalf of the department, the Ld. AR, Shri. Nagraj Naik strongly refuted the above submissions. He submitted that the Commissioner has considered the contentions of the appellant in respect of the issue of limitation in the impugned order and has found that appellant has suppressed facts. He adverted to para. 38 of the impugned order wherein the Commissioner has discussed the documents relied by the appellant. He argued that though the appellant had been submitting letters showing the work orders/rates split-up /availment of benefit o....
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....ve explicitly stated that 8%/10% is reversed and also stamped on these invoices showing that Rule 6(3) (b) of CENVAT Credit Rules, 2004 is followed. I have to say that as per the provision contained in CCR, 2002/04, the method opted by the appellant in computing the value of clearances does have some flaw. But it has to be taken note of that the appellant has been continuously submitting the work orders with rate split-up to the department and also informing the department as to the method of computation opted by the appellant. When these facts are very much evident from the letters as well as invoices, the department has issued the Show Cause Notice only in 2007 invoking the extended period. The commissioner has obs....