CCE Vs. SABOO ALLOYS PVT. LTD.

JUDGEMENT

(1.) THE issue involved in this case is as to whether the credit is required to be reversed in respect of inputs contained in the finished goods lying in stock on the date of the respondents opting for exemption.

(2.) THE learned DR on behalf of the revenue submits that the Commissioner (Appeals) allowed the appeal following the decision of larger Bench of the Tribunal in the case of CCE Rajkot v. Ashok Iron and Steel Fabricators . He submits that the Division Bench of the Tribunal in the case of Tractors and Farm Equipments Ltd v. CCE Madurai reported in 2007(79) RLT 384 (CESTAT -Che) after considering the larger Bench decision held that input credit taken in respect of inputs in stock or contained in final product, on the date of opting for exemption, all credit is to be reversed.

(3.) THE learned Advocate submits that Sub -rule (3) of Rule 11 of Cenvat Credit Rules, 2004 which was inserted by Notification No. 10/2007 dated 1.3.2007 provides a manufacturer or producer of the final product shall be required to pay an amount equivalent to the cenvat credit, if any, taken by him in respect of inputs during the manufacture of the said final product and is lying in stock or in process or as contained in final product lying in stock, if he opts for exemption from whole of duty of excise leviable thereon. He submits that prior to innertion of Rule (3) of Rule 11 of the said Rule demand is not sustainable. He also submits that larger Bench of the Tribunal in the case of Ashok Iron and Steel Fabricators has decided the issue in favour of the asessee which has been upheld by the Hon'ble Supreme Court as reported in 2003 (156) ELT A -212. He also submits that the Tribunal in a series of decisions held in favour of the assessee following the Larger Bench decision: