Customs, Excise and Gold Tribunal - Bangalore
Millipore (India) Pvt. Ltd. vs Commissioner Of Central Excise on 15 November, 1999
Equivalent citations: 2000(68)ECC204
ORDER
K. Sreedharan, President
1. Appellant is engaged in the manufacture of Microfiltration systems, High Purity Water Systems, Filtration Process Systems etc., falling under Chapter Sub-heading 8421.00 of the Central Excise Tariff Act, 1985. They filed declarations as required under Rule 57G of the Central Excise Rules for availing Modvat credit on various inputs. They were issued with show cause notice dated 12.8.1994 alleging that they had availed modvat credit of duty on the inputs which was not eligible as the said inputs were not declared in the form filed tinder Rule 57G. Accordingly, credit of Rs. 4,93,265.75 availed on the inputs erroneously was stated to be liable to be disallowed under Rule 57I of the Central Excise Rules, 1944. It further went on to state that if credit availed has been utilised towards payment of duty in the final product, then equivalent amount will be recovered under Rule 57I read with Section 11A of the Central Excise & Salt Act, 1944.
2. Appellant filed detailed reply to the show cause notice and submitted a comprehensive list of modvat inputs covered in the declaration and prayed for condonation of delay. The reason for filing the declaration for all the inputs was also indicated. Their objections were overruled by the adjudicating authority as per Order-in-Original No. 114/95 dt. 15.11.1994 (issued on 29.6.1995). Accordingly, he accepted the amounts quantified in the show cause notice and ordered in the following terms:
I therefore hold that credit under Rule 57A is not permissible. I order reversal and recovery necessary of Modvat Credit amounting to Rs. 4,93,265.75 under Rule 57I of Central Excise Rules, 1944.
3. Appellant took-up the matter in appeal before the Commissioner (Appeals). By Order-in-Appeal No. 30/97 dt. 13.2.1997, he disposed of the appeal observing "I agree that in case there is a difference in chapter heading/sub-heading the modvat credit cannot be denied if the inputs described and received are one and same. In this case, even the input description and classification were different. Hence modvat credit cannot be allowed."
4. Before us Learned Counsel representing the appellant submitted that there was no mis-description of classification of the inputs as was observed by the appellate authority. Whatever mistake that had crept in declaration filed under Rule 57G was only regarding the sub-heading. He placed before us the details of description of inputs as per the declaration vis-a-vis duty paying documents/show cause notice. In that list 11 items have been described. The first item is described in the declaration filed under Rule 57G as Philic Prefilter. In the Bill of Entry regarding the substance the description was AP15 Prefilter (Fibre Glass). In the show cause notice that item was mentioned as Prefilter (Fibre Glass). The word "Prefilter" is common to all the three. In the form 57G instead of Fibre glass "Philic" is mentioned. Likewise in all other items, the basic nature of the input was given in declaration filed under Rule 57G. Minor variation cannot, even on the appellate authorities' own findings, be a ground for disallowing the modvat credit.
5. Learned Counsel representing the appellant placed before us some of the decisions which are relevant to the issue in dispute. The first one is the decision of the Tribunal in the case of Tata Iron & Steel Co. Ltd . In that decision this Tribunal took the view that Modvat scheme is a beneficial piece of legislation and benefit should not be denied on the ground of hyper technical and hyper procedural objections. If such hyper technical interpretation is resorted to, it will defeat the very purpose for which the scheme is adopted by the department. In EICHER Motors Ltd, , this Tribunal took the view that detailed description of the inputs is not even required to be given in the declaration. Generic description of the inputs which are clearly identifiable under sub-heading or specific heading is sufficient to entitle a claim for modvat credit. In INDAG Rubber Ltd. it has been held by the Tribunal that broad description of goods given in the declaration filed under Rule 57G will make the manufacturer eligible for modvat credit when it is proved that the said input was utilised in the manufacture of the finished product. The Tribunal while stating the law in the above manner took note of the Circular N.E. No. 263/17/87-CX.8 dated 9.2.1988. In Bagpet Engg. Co. Pvt. Ltd. v. Commr., this Tribunal stated that difference of description in Modvat declaration and invoice and bill of entry cannot be detrimental to the claim of modvat if technical details regarding the items as given in the purchase Order and Invoice are same.
6. In view of these earlier pronouncements made by this Tribunal, taking into consideration the entire description of the goods, we hold that there was no misdeclaration or misclassification of the inputs by the appellant.
7. In Maxxon India Ltd. v. Collr., reported in 1997 (95) ELT 532 (T) even incorrect classification in respect of the inputs where they were shown under correct description will not be detrimental to the claim for modvat by a manufacturer. In the instant case, we are convinced that slight variations in the description has not in any way affected the claim put forth by the appellant. The inputs on which duty was paid was infact used in the manufacture of the final product. This issue is not at all disputed by the department. The generic description of the inputs in the declaration filed under Rule 57G clearly is identifiable from the entry in the Bill of Entry. The inputs mentioned in the Bill of Entry belong to the same category of the goods mentioned in the declaration filed under Rule 57G.
8. Learned Counsel representing the appellant fairly and rightly submitted before us that the first 6 items mentioned at page-95 of the paper book (in the Order-in-Original passed by the adjudicating authority) namely Socket, Pelican Wrench Socket Pelican Holder Compressor, Socket for Pelicon Tool, Resin, Rubberpad do not tally with the declaration filed under Rule 57G and therefore an amount of Rs. 12,100.92 is conceded.
9. In the circumstances detailed above, we allow the appeal and reverse the decision of the adjudicating authority and the appellate authority except to the extent of Rs. 12,100.92 with consequential relied as per law. The consequential relief, according to law, if entitled, should be extended as early as possible.