RAKO MERCANTILE TRADERS Vs. COMMISSIONER OF C. EX.

JUDGEMENT

(1.) THE appellants are manufacturers of excisable goods and they availed facility of Cenvat credit of duty on inputs under the Cenvat Credit Scheme. On 20 -3 -2009, there was a fire in the factory premises of the appellants and in the process, certain quantity of finished goods, stock in process and raw material got destroyed. The appellants intimated the details of raw material and stock in process which were lying in stock vide their letter dated 20 -3 -2009. On such goods, the total Central Excise duty amounted to Rs. 70,578/ - on inputs in process and Rs. 1,14,003/ - on inputs stored as such.

(2.) REVENUE was of the view that the appellants should have reversed the Cenvat credit taken on such inputs which were in stock and in process since such goods were not used in the manufacture of dutiable final products as required under Cenvat Credit Rules. A show cause notice was issued and the matter was adjudicated by the Assistant Commissioner of Customs demanding duty of Rs. 1,84,581/ -. Further a penalty equal to the said amount was imposed under Rule 15 of Cenvat Credit Rules, 2004. Aggrieved by the order, the appellants filed appeal with the Commissioner (Appeals) who confirmed the order of the Adjudicating Authority. Aggrieved by the order of Commissioner (Appeals), the appellants have filed this appeal before the Tribunal.

(3.) LEARNED Jt. CDR appearing for the Revenue submits that as per the settled law the appellants are not entitled to Cenvat credit of duty paid on the inputs, which have not been issued for the manufacturing process. For the above proposition, he relies upon the Tribunal's decision in the case of Panacea Biotech Ltd. reported as [ : 2013 (297) E.L.T. 587 (Tri. -Del.)]. As regards the credit involved in respect of inputs issued for the manufacture and as contained in 'goods in process', he submits that appellant did not take enough precaution to avoid the fire in which case they have to be held responsible for the fire accident and the credit should be directed to be reversed.