IPCA LABORATORIES LTD. Vs. C.C.E.

JUDGEMENT

(1.)

(2.) THE facts leading to filing of these appeals are in brief as under.

(3.) SH . B L Narsimhan, Advocate, the Ld. Counsel for the appellant pleaded that w.e.f. 01.03.2008 Rule 6(3A) was amended and this amendment gave an additional option to the manufactures of dutiable and exempted final product, using common cenvat credit availed input/input services and this additional option was to reverse the proportionate cenvat credit in respect of inputs/inputs services used in or in relation to manufacture of exempted final product which was determined as per the provision of Rule 6(3A) that by Finance Act 2010, the provisions regarding reversal of proportionate credit was made retrospectively applicable, that since, the appellant have not taken the proportionate credit in respect of the input services used in or in relation to the manufacture of exempted final products, the option of paying 10% of the sale value of the final product cannot be forced upon them, that Hon'ble Gujarat High Court in case of Sh. Rama Multitech Ltd. v. UOI reported in : 2011 (267) ELT 153 Guj has held that in view of retrospective amendment to Rule 6(3) by Finance Act, 2010, even when the separate accounts of the input/input services meant for dutiable and exempted final product were not maintained, the manufacture is entitled to reverse proportionate credit, that in the present case, the Commissioner has not even disputed the quantum of credit foregone but has invoked the provisions of Rule 6(3)(b) and demanded an amount equal to 10% of the sale value of the exempted final product only on the ground that a separate account and inventory of the input services meant for dutiable final product has not been maintained, that this stand of the Department would not be correct in view of retrospective amendment to Rule 6(3) by Finance Act, 2010, which gives the manufacture an additional option of reversal of the proportionate cenvat credit attributable to the exempted final product, that when the appellant have already foregone the proportionate credit attributable to the exempted final product, the provisions of Rule 6(3) read with rule 6(2) stands complied with and hence, the amount equal to 10% of the sale value of the final product cannot be demanded from them. He, therefore, pleaded that the impugned order is not correct.