TaxTMI 
TaxTMI 
2018 (2) TMI 807
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....appeared that appellants had availed Cenvat credit of duty paid on components, spares and accessories of capital goods and these were used exclusively in the manufacture of exempted final products attracting nil rate of duty during the material period. That the final products namely 100% cotton yarn manufactured by the appellants was exempted undisputedly (nil rate of duty) during the material period. The credit availed on capital goods is irregular as it contravenes Rule 6 (4) read with Rule 2 (d) of Cenvat Credit Rules, 2004, SCN was issued raising allegation of irregular credit availed on capital goods and proposing to recover the same along with interest and for imposing penalties. After due process of law, the adjudicating authority co....
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....t the final products cleared by them are exempted from payment of duty. The appellant has taken shelter of Rule 6 (5) of CCR, 2004. The relevant portion of the said Rule reads as under:- "(6) The provisions of sub-rules (1), (2), (3) and (4) shall not be applicable in case the excisable goods removed without payment of duty are either (i) cleared to a unit in a special economic zone or (ii) cleared to a 100 % export-oriented undertaking; or (iii cleared to a unit in an Electronic Hardware Technology Park or Software Technology Park; or (iv) supplied to the United Nations or an international organization for their official use or supplied to projects funded by them, on which exemption of duty is available under notifidation of the....
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....one or to a developer of a special economic zone for their authorized operations; or (ii)..... (iii).... (iv).... (v) cleared for export under bond in terms of the provisions of the Central Excise Rules, 2002; or (vi)..... 12. A plain reading of sub-rule (1) of Rule 6, would show that Cenvat Credit is not allowed, inter alia, qua such input service, which is used in the manufacture of exempted goods, except in circumstances mentioned in sub-rule (2). Sub-rule (2) is not relevant for the purposes of this case. 12.1 In so far as sub-rule (6) of Rule 6 is concerned, it clearly states that provisions of sub-rules (1), (2), (3) and (4) shall not be applicable, in case of excisable goods, are removed without payment of duty, inter....