Per G.R. Sharma :

In this case the Ld. Commissioner (Appeals) had observed that the clearance of goods under bond at Nil rate of duty in terms of Notification No. 49/94-CE (NT) dt. 22.9.94 issued under Rule 13 of the Central Excise Rules was treatable as clearance of goods without payment of duty; that the provision of Rule 57C are, therefore, attracted. He, therefore, rejected the appeal of the assessee. Being aggrieved by this order the assessee has filed the two captioned appeals.

2. The facts of the case in brief are that the appellants took credit of duty paid on inputs under Rule 57A. These inputs are used in the manufacture of final product namely D-Alpha Phenyl Glycine Chloride Hydrochloride which they cleared from their factory without payment of duty on Bond in terms of Notification No. 49/94-CE (NT) dt. 22.9.94 issued under Rule 13 of the Central Excise Rules. The contention of the Department was that the assessee cleared the goods from their factory under invoices at 'Nil' rate of duty by following the procedure laid down in Chapter X of the Central Excise Rules; that the assessee had not reversed the Modvat credit of duty in respect of the inputs contained in the said excisable goods in their Modvat account at the time of clearance of the said excisable goods from their factory which tentamount to violation of the provisions of Rule 57C; that Rule 57C provides that no credit shall be allowed if the final product is exempt from the whole of duty of excise leviable thereon or is chargeable to Nil rate of duty.

3. Arguing the case Shri G. Shiv Das, Ld. Counsel appeared for the appellant and submitted that their case is fully covered by the decision of this Tribunal in the case of Reliance Industries Ltd. Vs. CCE reported in 1995 (78) ELT. 595 wherein this Tribunal held that inputs used in the manufacture of final products cleared under Bond for export purposes in terms of Rule 191B/191BB of the Central Excise Rules, 44, benefit of proviso to Rule 57F (3) ibid was available for removing similar goods for home consumption and that the goods cleared for export under Bond without payment of duty are neither goods 'exempted' from whole of duty nor are goods chargeable to 'Nil' rate of duty. Ld. Counsel also submitted that similar view was taken by this Tribunal in the case of Orissa Synthetics Ltd. Vs. CCE reported in 1994 (69) ELT. 585. He submits that in this case the Tribunal had observed that input credit was admissible for manufacture of intermediate products which are cleared to another factory under Bond under Rule 191B/191BB of Central Excise Rules, 44 for export production; that products so cleared under Bond are not treatable as goods wholly exempt or chargeable at Nil rate of duty. Ld. Counsel submits that their case was fully covered by these decisions of the Tribunal and that the provisions of Notification No. 49/94-CE/NT dt. 22.9.94 are similar to the provisions of Rule 191B and Rule 191BB. He, therefore, submitted that their case was fully covered by the above decisions of the Tribunal and he, therefore, prays that these appeals may be allowed.

4. Shri R.D. Negi, Ld. SDR submits that in this case the appellants were required to follow the provisions of Notification No. 49/94 dt. 22.9.94 that the goods were cleared at Nil rate of duty and therefore, the authorities below had rightly held that provisions of Rule 57C were attracted in this case and therefore, disallowed benefit of Modvat credit. He submitted that the Ld. Commissioner (Appeals) had rightly relied on the decision of this Tribunal in the case of Dujodwala Resins Terpenes Ltd. Vs. CCE reported in 1996 (14) RLT. 650.=1997 (93) ELT. 451. He, therefore, prayed that these appeals may be rejected.

5. We have heard the rival submissions. We have also perused various decisions of this Tribunal and the two decisions cited and relied upon by the assessee. We find that Notification No. 49/94 was issued under Rule 13 of the Central Excise Rules, 44 which per