Per G.R. Sharma :

The limited issue for determination in this appeal is whether the respondents were entitled to clear the inputs for home consumption on payment of duty equal to the amount which was paid by the suppliers of inputs who were enjoying the benefit of concessional rate of duty as a SSI Unit. The clearance of inputs was in November, 1993.

2. The facts of the case briefly stated are -

That the respondents are manufacturer of aerated water and were availing the benefit of credit of duty paid on inputs under the modvat scheme. During the month of November, 1993, the respondents cleared for home consumption crown cork and Carbon Dioxide gas by debiting duty equal to the amount taken as modvat credit. The department alleged that the respondents should have paid duty as if the inputs had been manufactured in their factory. A show cause notice was issued to the respondents asking them to explain as to why the differential duty should not be demanded from them on the inputs cleared by them for home consumption. They contended that they paid duty on the inputs at the rate at which credit was taken and that this was the correct rate applicable in their case. They cited and relied upon the judgment of this Tribunal in the case of Modi Rubber Limited reported in 1993 (68) ELT 24. It was contended also by the respondents that they were not manufacturers of crown corks and Carbon Dioxide gas but purchased the goods from small scale units who paid duty at the appropriate rates applicable to them. The Assistant Commissioner adjudicating the case confirmed the demand and imposed a personal penalty of Rs. 1,000/-. On appeal, the learned Commissioner (Appeals) relying on the ratio of the judgment of this Tribunal in the case of Collector of Central Excise, Coimbatore Vs. American Auto Services reported in 1996 (13) RLT 364 = 1996 (81) ELT 71 held that the order-in-original passed by the Assistant Commissioner was not sustainable in law and, therefore, set aside the same and allowed the appeal of the assessees. Being aggrieved by this order, Revenue has filed the captioned appeal before the Tribunal.

3. S/Shri Y.R. Kilania and Sanjeev Srivastava, learned Departmental Representatives represented the appellant Commissioner. None was present for the respondents.

4. After hearing the Departmental Representatives, the following order is passed-

It was submitted that Rule 57F (1) (ii) as it was during the material period sub-Rule (ii) of sub-Rule (1) of this Rule read "(ii) the inputs in respect of which a credit of duty has been allowed under Rule 57A shall be removed, after intimating the Assistant Collector of Central Excise having jurisdiction over factory and obtaining the dated acknowledgement of the same, from the factory for home consumption or for export under bond, as if such, inputs have been manufactured in the said factory." The emphasis of the learned Departmental Representatives was that the Rule specifically provides that at the time of removal of the inputs on which modvat credit has been taken the rate of duty shall be as if the inputs were manufactured in the factory from where they are being removed. The learned Departmental Representative submitted that in the instant case, the respondents removed the inputs; that the respondents were not a SSI unit and, therefore, was not entitled to the benefit of concessional rate of duty as a SSI unit and hence the rate applicable to a normal unit should be the rate to be applied to the inputs removed by the respondents herein. He submitted that reliance has been placed on Notification No. 28/95-CE dated 29.6.95 that this Notification cannot be termed as clarificatory in nature inasmuch as there is nothing to show that this Notification was to be applied with retrospective effect. Therefore, this Notification will not be applicable to the present case inasmuch as the present case pertains to November, 1993 whereas the Notification was issued on 29.6.95. The learned Departmental Repre