Customs, Excise and Gold Tribunal - Delhi
M/S. Century Pulp & Papers vs Cce, Meerut on 11 April, 2001
ORDER
P.S. Bajaj
1. This appeal has been filed by the appellants againt the order in appeal dated13.6.96 passed by the Commissioner (Appeals) disallowing modvat credit in respect of refractory products, industrial valves and other parts of recovery bilers, & items used in electrical installations like wires and cables.
2. The appellants were engaged in the manufacture of writing and printing paper classifiable under Heading 48.02 of the CETA. They took modvat credit of the amount in question on the duty paid 'capital goods' received and used by them within their factory for producing/processing the final product in terms of declarations filed by them under Rule 57-1 of the Central Excise Rules during the period April 1994 to November 1994. They were, however, issued various show cause notices for the recovery of the modvat amount on the ground that the goods in respect of which the modvat credit was taken did not fall within the ambit of 'capital goods' as defined in Explanation 1 appended to Rule 57-Q of the Rules. After getting their reply to those show cause notices wherein they pleaded that the goods were 'capital goods' in respect of which they had taken the modvat credit for having paid the duty thereon and used the same in the manufacture of their final products, the Assistant Commissioner did not accept their version and disallowed the modvat credit of Rs.1, 14, 54, 551/- on the ground that the same was availed on the goods which did not qualify the definition of 'capital goods'.
3. In appeal this order of the Assistant Commissioner was modified by the Commissioner (Appeals) who allowed the modvat credit on certain more goods as detailed in his impugned order in appeal, in addition to the goods on which the Assistant Commissioner permitted the modvat credit.
4. The appellants have come up in appeal before the Tribunal
5. The learned counsel for the appellants has contended that the modvatability of the goods on which the credit had been disallowed, has not been examined in the light of the ratio of the law laid down in Jawahar Mills Ltd. Vs. CCE Combatore & Ors. 1999(108) ELT 47(T) and also by the Five Member Bench of the Tribunal recently in CCE Vs. Surya Roshini Ltd. 2001 (42) RKT &17(T). therefore, the impugned order of the Commissioner (Appeals) deserves to be set aside and the matter be sent back to the adjudicating authority for fresh decision in accordance with law laid down in those cases.
6. The learned JDR, on the other hasnd, has not disputed that the modvatability of the goods in question has to be examined by the authorities below in the light of the ratio of the law laid down by the Five Member Bench of the Tribunal in CCE Vs. Surya Roshini Ltd. (supra) and as such the matter may be sent back for fresh decision to the adjudicating authority.
7. We have heard both the sides and gone through the record.
8. The disputed goods on which the modvat credit has been disallowed by the authorities below to the appellants, had been detailed in the table appended to the order in original of the Assistant Commissioner dated 29.8.95. The Five Member Bench of the Tribunal recently in CCE Vs. Surya Roshini Ltd. (supra) after considering the law earlier laid down by the Three Member Bench in Jawahar Mills (supra) had taken the view that the goods for the purposes of modvat credit must satisfy one of the three conditions detailed in Explanation I of Rule 57-Q three conditions detailed in Explanation I of Rule 57-Q of the Rules at it stood at relevant time. No clear cut finding in the present case had been recorded either by the Assistant Commissioner or by the Commissioner (Appeals) that the goods in question did not satisfy any of those conditions incorporated in the Explanation I of Rule 57-Q of Rules. Therefore, modvatability of the goods in question needs examination in the light of the law laid down in the above said case decided by the Larger Bench of the Tribunal. For that purpose we must send back the case to the adjudicating authority after setting side the impugned order of the Commissioner (Appeals).
9. In view of the discussion made above, the impugned order of the Commissioner (Appeals) is set aside and the case is sent back to the adjudicating authority for fresh decision in the light of the observations made above after affording opportunity of hearing to both the sides. The appeal of the appellants accordingly stands allowed by way of remand.