TaxTMI 
TaxTMI 
2017 (6) TMI 422
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....om the manufacturer after payment of duty and are availing exemption on such motor vehicle bodies. The respondent manufactured motor vehicle bodies for chassis who cleared the same on payment of duty for getting the body fabricated from outside and cleared those motor vehicle bodies on payment of duty. The respondent availed exemption on motor vehicles fabricated for independent owners of chassis. In terms of S.No.229 of Notification No.3/2001-CE dated 1.3.2001 and S.No.212 of Notification No.6/2002-CE dated 1.3.2002, the exemption under the said notifications is available subject to the conditions that the vehicles should be manufactured out of the chassis under heading 87.06 on which duty of excise has been paid and no credit of duty paid....
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....hat if the respondent is claimed the exemption then the respondent is liable to pay 8% of the value of chassis plus bodies of the vehicles, therefore, the impugned order is to be set aside. 4. On the other hand, learned Counsel for the respondent submits that the respondent has not taken the credit on duty paid chassis. The respondent has availed credit of the duty on other inputs for fabrication of bodies of that chassis. Therefore, the respondent is required reversed 8% of the value of motor vehicle bodies. The respondent has complied with the condition of Rule 6 (3) (b) of the Cenvat Credit Rules,2001 the impugned order is to be upheld. 5. Heard both sides and considered the submissions. 6. On careful consideration of the submissions ....
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....57,16,828/- is confirmed (b) The penalty imposed on the respondent is set aside. 9. With these terms, the appeal is disposed of. ( Pronounced in the open court on ) Per : Devender Singh, Member (T) 10.1 I had the benefit of going through the order recorded by learned brother Shri Ashok Jindal, Member (Judicial). While I agree with the confirmation of demand of Rs. 57,16,828/- as concluded by learned Member (Judicial), I am unable to agree on the issue of non-imposition of penalty. Hence, I record a separate order in respect of penalty. 10.2 It is undisputed that the assessee has manufactured 142 motor vehicles out of the duty paid chassis received from different parties and cleared the same without payment of duty in terms of Sr. No. ....
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....he respondents also deliberately violated the Rule 6(3)(b) of Cenvat Credit Rules, 2002: I find that Rule 6(3)(b) of Cenvat Credit Rules prescribes that in case a manufacturer uses common inputs for the manufacture of both dutiable and exempted goods and takes credit of duty paid on such common inputs, he will pay an amount equal to 8% of the total value of exempted goods before their clearance from the factory. This has been prescribed to nullify the effect of credit taken on inputs. Therefore, after reversal of 8% amount, these inputs do not remain cenvated ones and are at par with inputs on which no credit has been taken. Accordingly, it will not deter the noticees from availing the benefit of provisions of....
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..... 10.5 Since the benefit of exemption is an exception for which the respondents have to actively bring themselves into the purview of that exemption to get benefit by complying with condition(s) therein, availing the benefit of notification despite non-fulfillment of the condition in the face of unambiguous law and by way of willful misstatement shows a clear intent to evade the duty. In the case of reversal of Cenvat Credit, there is no ambiguity that 8% of the total value of exemption goods was to be reversed. Still, they reversed / paid an amount to 8% of the value of bodies of the motor vehicles instead of complete motor vehicle. There is no question of interpretation involved as the law again is very clear. In these circumstances, the....