2004 (8) TMI 204

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.... and 57-AD(2) of the Central Excise Rules, 1944, or not. The lower authorities have disallowed this abatement and confirmed the differential demand of Rs. 16,30,197/- with penalty of Rs. 1 lakh against the appellants. 2. The facts are not much in dispute. The appellants are engaged in the manufacture of Wrist watches. They availed the Modvat credit on the inputs used in the manufacture of those watches, the retail price of which was Rs. 500/- per piece during the period March, 2000 to February, 2001 and cleared those watches without payment of duty by availing exemption under Notification No. 6/2000-C.E. dated 1-3-2000. For having not maintained the separate record in terms of Rules 57CC and 57AD(2) of the Rules in respect of the inputs ....

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....entitled to take abatement of 35% of MRP is wholly misconceived and cannot be accepted. The wording of Rule 57CC is quite clear and unambiguous and it mandates, that an assessee shall pay 8% of the total price excluding sales tax and other taxes, if any paid, of the exempted cleared goods. The exclusion provided under this Rule is of sales tax and other taxes, if any, paid while computing the total price of the exempted cleared goods. This rule does not speak of availability of any abatement of 35% of the MRP, to an assessee, while calculating the total price of such goods, for the purpose of payment of 8% thereon. The appellants, therefore, cannot legally claim this abatement while calculating the 8% of the total price of the exempted good....