SHREE BABA EXPORTS Vs. CCE

JUDGEMENT

(1.) THE facts leading to filing of this appeal are, in brief, as under: - -

(2.) HEARD both the sides.

(3.) MS . Sweta Bector, ld. Departmental Representative, while defending the impugned order upholding the cenvat credit demand pleaded that since the main final products - Menthol flakes and Menthol Crystals obtained from duty paid Menthol had become fully and unconditionally exempt from duty w.e.f. 1.3.2008, the provisions of Section 11(3) of Cenvat Credit Rules, 2004 would become applicable, as the appellant were availing input duty credit in respect of the inputs Crude Menthol used in the manufacture of Menthol flakes and Menthol Crystals, that since the DMO and fractions of DMO are only a by -product and the main products are Menthol and Menthol Crystal, the provisions of Rule 11(3) had become applicable w.e.f. 1.3.2008 when the main product had become fully exempt notwithstanding the fact that the by -products DMO/DMO fractions remained dutiable, that the word excisable in Rule 6(6) of the Cenvat Credit Rules, 2004 has to be interpreted as dutiable and since the main final products were no longer dutiable w.e.f. 1.3.2008, the provisions of Section 11(3) of the Rules would become applicable, that no evidence has been produced by the appellant in support of their plea that during the period of dispute, their finished products were being exported out of India and that in view of this, there is no infirmity in the impugned order upholding the cenvat credit demand. With regard to the Revenue s appeal, she pleaded that since the confirmation of cenvat credit demand has been upheld, penalty under Rule 15(2) of the Cenvat Credit Rules read with Section 11AC of the Central Excise Act would be attracted and there is absolutely no justification for setting aside this penalty, as the appellant had suppressed the relevant information from the department.