SURYA ROSHNI LTD. Vs. CCE

JUDGEMENT

(1.) The issue involved in this appeal, filed by M/s. Surya Roshni Ltd., is whether the benefit of exemption under Notification No. 3/2001 -CE dated 1.3.2001 is available in respect of bulbs manufactured by them having retail sale value not exceeding Rs 20 per bulb.

(2.) Shri B.L. Narsimhan, learned Advocate, submitted that the Appellants manufacture bulbs and avail the benefit of Notification No. 3/2001 -CE which provides concessional rate of duty in respect of bulbs of M.R.P. not exceeding Rs. 20 per bulb subject to the condition that no Credit of duty paid on the inputs has been availed by the manufacturer and the duty has to be paid in cash or through account current; that for the purpose of manufacture of bulbs the Appellants also manufacture "Filament, Capping Cement/Calcite Mixture, Lead Glass Tubing, and Glass Shell; that these items are also being used for the manufacture of Fluorescent tube lights, which are dutiable; that sometimes they also clear these item on payment of Excise duty outside the factory; that for the manufacture of these 4 items they received various duty paid inputs on which initially Modvat Credit is taken by them; that in view of the condition subject to which the benefit of Notification No. 3/2001 is available every fortnight of the month prior to the payment of Excise duty at concessional rate they reverse the Modvat Credit attributable to the inputs which went into making of 4 product which in turn in used in the manufacture of bulbs having M.R.P. not exceeding Rs. 20 per bulb; that the Commissioner under the impugned Order has denied the concessional rate of duty under Notification No. 3/2001 (Srl. No. 262) on the ground that as the Modvat Credit has been taken initially by the Appellants, the condition of the Notification has not been complied with.

(3.) Countering the arguments Mrs. Charul Baranwal, learned SDR, reiterated the findings contained in the impugned Order and emphasized that the decision of the Supreme Court in the case of Chandrapur Magnet Wires would be applicable only when the manufacturer debit Modvat Credit before removal of the exempted final product; that it is apparent from the method of reversal of Modvat Credit adopted by the Appellants that the reversal of the Credit had been made at the stage when intermediate products were cleared internally for captive consumption in the manufacture of bulb in respect of which benefit of notification No. 3/2001 is availed of; that instead reversal of Credit was made on fortnightly basis and it cannot, therefore, be claimed by them that reversal had been made before removal of the consignment from the factory. She further submitted that the Commissioner has given a very specific finding in the impugned Order that "the Appellants has not placed before him any evidence to show that in respect of each consignment of such bulbs, reversal has been made invariable before removal of such consignment from the factory. In other words, it may be said that the notice had failed to establish, (onus of which lies on them) that no input in which CENVAT Credit has been taken were contained in any of the consignment of such bulbs cleared on payment of duty at the concessional rate." He, therefore, submitted that the demand of duty has, therefore, been rightly made against the Appellants.