2017 (2) TMI 250

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.... M/s.Encoboard Industries Ltd. were engaged in manufacture of dutiable goods which became exempted from Central Excise duty with effect from 04/02/2004. The appellants were issued notice demanding reversal of credit on inputs invoking Rule 6 (1) read with Rule 3 of Cenvat Credit Rules, 2002. The demand was confirmed by the lower authorities. Aggrieved by the said order, the appellants are before t....

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....te shall be disallowed. The appellant also relies on the decision of the Hon'ble High Court in the case of Premier Tyres 2001 (130) ELT 417 (Ker.) and on the decision of the Tribunal in the case of Ashok Iron & Steel Fabricators 2002 (140) ELT 277 (T-LB). 3. Ld. AR relies on the impugned order. He specially relied on the decision of the Tribunal in the case of Albert David Ltd. 2003 (151) E....

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....lso not in dispute that these inputs are being used in the manufacture of I.V. fluids which are wholly exempted from payment of duty. The Cenvat Credit Scheme is a scheme to remove the cascading effect of the Central Excise duty as the same is levied at each stage of manufacture. The credit is available only and only if the final product suffers the Excise Duty. If no excise duty is payable in res....

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....f inputs which is used in the manufacture of exempted goods. Rule 57AH contains the provision for the recovery of Cenvat credit utilized wrongly. As the inputs have been utilized in the manufacture of wholly exempted goods credit taken in respect of such inputs is recoverable. The demand is not hit by the time limit as the recovery is related in the instant matter to utilization of inputs for manu....