2015 (10) TMI 2650

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....l Excise Tariff Act, 1985. The appellant was availing benefit of money credit scheme as per provisions under rule 57K to 57P of the erstwhile Central Excise Rules 1944, read with notification 45/89 CE as amended by Notification No.13/90-CE. The appellant had a credit balance of Rs. 35,15,643/- on account of money credit scheme in their RG-23B Part II as on 23.07.96, when Notification No.45/89 was rescinded and vegetable product become exempt. The brief background of the scheme is that vide Notification No.27/07-CE, the input credit of the specified amount on the minor oils (input) was allowed like Mahua oil, watermelon oil, etc. and the said credit could be used for clearance of final products being vegetable product, subject to the utiliza....

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....ow cause notice by filing reply to the effect that the credit taken legally gives vested right, which cannot lapse under subordinate legislation being rescission of notification under the provisions of the Act and the Rules. However, in the circumstances the appellant stopped utilising further credit. The said SCN was adjudicated vide order-in-original dated 7/9/2005 and the proposed demand of Rs. 18, 05, 056 was confirm along with interest. Further penalty of Rs. 10 lakhs was imposed under rule 25 of the Central Excise Rules. Being aggrieved the appellant preferred appeal before the Commissioner (Appeals) vide the impugned order was pleased to reject the appeal and uphold the order in original. Being aggrieved the appellant is before this ....

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....enefit including utilization of any balance credit which could not be utilized due to restriction imposed by the revenue. 4. The ld.DR relies on the impugned order. He further emphasizes that once the scheme is rescinded their accumulated credit under the scheme also lapses. He further relies on the ruling of Honourable Supreme Court in the case of Eisher Motors Ltd. Vs. Union of India : 1999 (106) ELT 3, wherein it was held that right to adjust tax on final products accrued to the assessee on the date, when they paid the tax on the raw materials or the inputs. Such right vested on the basis of statutory scheme. Sec.37 of Central Excise Act, does not enable authorities to make rule to effect lapsing of credit balance in modvat account. ....