2017 (7) TMI 1029

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.... (Rs.) 1 E/234/2009 Rs.44,40,360/- Rs.400,000/- 2. E/916/2008 Rs.27,40,381/- Rs.27,40,381/- For the sake of convenience, facts of the Appeal No.E/234/2009 are taken, Briefly the facts of the present case are that the appellants are engaged in the manufacture of bulk drugs and medicines falling under Chapter 29 and 30 of the First Schedule to the Central Excise Tariff Act, 1985 and they have their factories located at Kurkumbh in Pune, Verna in Goa, Vikhroli in Mumbai and Patalganga in Raigad. The bulk drugs manufactured by the appellants are captively consumed in the manufacture of formulations within their factory or is stock transferred to other factories for manufacture formulations. Some quantities of the bulk drugs manufacture....

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....ances a show-cause notice dated 01.04.2008 was issued to the appellant on the ground that when separate maintenance account for receipt, consumption and inventory of inputs which are common to dutiable as well as exempted goods has not been maintained in terms of Rule 6(2), the appellants will have to pay the amount equal to 8% or 10% of the sale price of the exempted final products cleared from the factory either for home consumption or for export. The show-cause notice proposed to demand an amount of Rs. 66,34,999/- (Rupees Sixty Six Lakhs Thirty Four Thousand Nine Hundred and Ninety Nine only) being the 10% of the amount payable in terms of Rule 6(3)(b) of the Cenvat Credit Rules 2004 after reducing the proportionate credit of Rs. 1,09,5....

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....ar.) wherein it has been held that when the assessee has reversed the proportionate credit there is no requirement to further reversal of 8% of the value of exempted goods even when the assessee has not maintained separate accounts. The learned counsel further submitted that the reversal of credit amounts to not taking credit as held in the case of CCE Vs. Precot Meridian Ltd - 2015 (325) E.L.T. 234 (SC) and CCE, Mumbai Vs. Bombay Dyeing & Mfg. Co. Ltd. reported in 2007 (215) ELT 3 (SC). The learned counsel further submitted that the Finance Act 2010 has amended Rule 6 of the Cenvat Credit Rules with retrospective effect and provided for reversal of proportionate credit attributable to common inputs used in the manufacture of exempted bulk ....