TaxTMI 
TaxTMI 
2003 (7) TMI 181
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....bsp; Engines are cleared for home consumption on payment of excise duty. Diesel engines are also removed for captive consumption for the manufacture of centrifugal pump sets commonly known as couple sets. Centrifugal pump sets consists of diesel engine as well as centrifugal pumps. These two items are coupled together and mounted together on a common base plate. The resultant product is called as pump set or couple-set. (c) The department took the view that diesel engine when cleared for captive consumption is not chargeable to duty in view of Notification No. 4/97-C.E., Notification No. 5/98-C.E. (pg 7-14 of compilation) of similar notifications issued from time to time in each Financial Year (her....
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....98 held that diesel engines are not exempted under the said notifications and therefore Rule 57CC is not applicable in the facts and circumstances of the present case. This order covers the period April, 1997 to March, 1998. Consequently, PFMI is entitled to refund of 8% paid by them under Rule 57CC on the price of the diesel engines. (g) While the aforesaid issue was pending, the department at the same time raised another dispute to the effect that PFMI is required to reverse 8% on the selling price of the centrifugal pump sets, and not on the price of diesel engine. Accordingly, the department raised a demand for the differential amount covering the period April, 1997 to September, 2000 being the amount of 8....
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....emption notification at all. After hearing both sides and considering the issue raised it is found. 3.After hearing both sides and considering the issues raised, it is found : (a) When Board has clarified that amounts reversed under Rule 57CC are not duty the same cannot be covered by the stipulations of Section 11B of the Central Excise Act, 1944 and the theories of unjust enrichment. The order of the lower authorities to that effect can not be sustained. (b) IC engines are separate excisable entities mentioned in the Tariff and by application of the rules of classification for parts as provided under CETA, 1985 they cannot be termed and or classified as....
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....turer is engaged in the manufacture of any final product which is chargeable to duty as well as in any other (final product which is exempt from the whole of the duty of excise leviable thereon or is chargeable to nil rate of duty) and the manufacturer takes credit of the specified duty on any inputs (other than inputs used as fuel) which is used or ordinarily used in or in relation to the manufacture of both the aforesaid categories of final products, whether directly or indirectly and whether contained in the said final products or not, the manufacturer shall, unless the provisions of sub-rule (9) are complied with, pay an amount equal to eight per cent of the price (excluding sales tax and other taxes, if any, payable on such goods) of t....
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....esel Engines to have been correctly availed, since duty is to be discharged on IC engines which are captively used for manufacture of Pumpsets or cleared for home consumption. As far as Modvat credit on Diesel Engines is concerned, there are no two categories of final products i.e. one dutiable and one exempt. Therefore Rule 57CC will not be applicable, for credits taken on parts which go to manufacture of Diesel Engines. (g) In view of our findings, the debits of 8% made under protest are required to be reversed, there being no bar of Section 11B, No demands in this case as made out and confirmed, as regards the 'amounts' under Rule 57CC could be upheld and orders thereto are required to be set as....