TaxTMI 
TaxTMI 
2017 (1) TMI 1184
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....e involved in the matter is whether the respondent was required to reverse the credit on inputs in stock which were lying in their factory at the time of opting the area based exemption under Notification NO.50/2003-CE dated 10.6.2003 or not. 4. The issue has already been resolved by this Tribunal in the case of Himachal Futuristic Communications Ltd. vide Final Order No.61395-61396/2016-EX (DB) dated 19.9.2016 wherein this Tribunal has observed as under: 5. We find that the sole question for consideration is that whether the inputs lying in stock on the date on which exemption Notification No.50/2003-CE dated 10.6.2003 exempted final product, the appellant is required to reverse the credit lying in their stock or not. ....
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.... Id. Advocate that the Notification No. 10/2007-C.E. (N.T.), dated 1-3-2007 inserted sub-rule (3) to Rule 11 of Rules 2004, is a specific provision for reversal of credit because such issue was not in the referral order. 7. The said issue also came up before the Hon'ble High Court of Himachal Pradesh in the case of United Vanaspati Ltd.(supra) wherein the Hon'ble High Court of Himachal Pradesh has observed as under: 7. It is pertinent to mention here that the Apex Court in Collector of Central Exicse, Pune and others v. Dai Ichai Karkaria Ltd. and Others 1999 (112) E.L.T. 353 (S.C.) = 1999 (7) SCC 448 considered a similar question relating to the reversal of Modvat credit under Central Excise Rules, 1944. Rule 57H(5) of the said....
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.... stands cancelled or, if utilized, has to be paid for. We are here really concerned with credit that has been validly taken, and its benefit is available to the manufacturer without any limitation in time or otherwise unless the manufacturer itself chooses not to use the raw material in its excisable product. The credit is, therefore, indefeasible. It should also be noted that there is no corelation of the raw material and the final product; that is to say, it is not as if credit can be taken only on a final product that is manufactured out of the particular raw material to which the credit is related. The credit may be taken against the excise duty on a final product manufactured on the very day that it becomes available." 9. Rule....
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....2008 (223) E.L.T. 149. The High Court held as follows :- "It can be seen from yet another angle. In case inputs are received in factory and used in manufacture of end product. But the end product is destroyed by fire before stage of its removal from factory premise. In such circumstances, no excise duty becomes payable on end product. Yet Modvat credit availed on inputs used in destroyed goods is not to be recalled. This is also suggestive of the fact the relevant date for considering exemption from duty of the end product in or in relation to which inputs are used is the date of its receipt in factory and condition is its actual use in or in relation to manufacture of end product by the manufacturer. The chargeability to duty or n....
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....ria Ltd. and Others, 1999 (7) SCC 448 = 1999 (112) E.L.T. 353 (S.C.) the Division Bench of this Court specifically held that even though final product may be exempt from payment of excise, the assessee cannot be asked to reverse the Modvat credit already taken by it. The substantial question of law was answered in favour of assessee as against the Revenue. 10. Subsequently, the very same view stands reiterated by another Division Bench of this Court in Saboo Alloys Pvt. Ltd. (supra), wherein also the following substantial question of law was involved and assessee s similar plea accepted :- "Whether a manufacturer is required to reverse the Cenvat Credit taken by him in respect of inputs which are proved to have been used i....