Customs, Excise and Gold Tribunal - Delhi
M/S. Mawana Sugar Works vs C.C.E., Meerut on 5 February, 2001
ORDER
S.S. Kang
1. The appellants filed this appeal against the order-in-appeal passed by the Commissioner (Appeals). In the impugned order, the benefit of MODVAT Credit was denied to the appellants on the ground that they had not filed any declaration in respect of Chemu-400 and Chemifloc L.T. 27. In respect of the input, viz., Chemocide, it was held that the credit was taken without filing any declaration. In respect of Phosphoric Acid, the invoice was not in order as no PLA No. is mentioned and the invoice was not pre-authenticated.
2. Ld. Counsel, appearing on behalf of the appellants, submits that the appellants filed declaration in respect of inputs declaring MAZU-400 and Megnaflock L.T. 27, which are the same inputs under the different brand names. He submits that in respect of Chemocide, this input was received in the factory on 1.10.94 and the declaration was filed on 25.10.94 and credit was taken on 30.10.94 i.e. after filing the declaration. In respect of Phosphoric Acid, his contention is that there was no allegation in the show cause notice that the invoice, under which this input was received, was not pre-authenticated. He submits that Rule 57 G is now amended by notification no. 7/99 dated 9.2.99 and this amended rule provides that no credit shall be denied on the ground that the documents under which the goods were received, do not contain all the particulars required to be contained therein under the rules and in respect of declaration, credit shall not be denied on the ground that the declaration filed does not contain all the details. He submits that the Tribunal in the case of Kamakhya Steels (P) Ltd. vs C.C.E. reported in 2000 (40) RLT 575, after considering the Board's Circular No. 441/7/89-CX dt. 23.2.99, wherein it was clarified that the amended provisions of Rule 57 G will be applicable in the pending case and remanded the matter for de novo adjudication. He, therefore, prays that in the present case also the matter may be remanded.
3. Heard ld. S.D.R., who reiterates the findings of the lower authorities.
4. In this case, the credit on inputs is being denied by the revenue on the ground that no declaration was filed or the credit was taken before filing the declaration or invoices were not in accordance with rules. Rule 57 G of the Rules is amended by notification no. 7/99 CE dated 9.2.99. The Board vide circular dated 23.2.99, clarified that the amended rule will be applicable in the pending cases. This amendment and circular was taken into consideration by the Tribunal in the case of Kamakhya Steels (P) Ltd. (supra). The Tribunal in this case hela as under:
"Shri A.R. Madhav Rao, ld. Advocate as an intervener submitted that the question referred to the larger bench in the instant case need not be answered and matter be remanded to the Adjudicating Authority to examine the issue afresh in the light of amendment to Rules 57G and 57T as per Notification No. 7/99-CE(NT) dated 9.2.99 and the two Circulars (M.F. DR. Letter F.No. 267/6/92-CX dated 30.1.92 and Circular No. 441/7/99-CX dt. 23.2.99) [reported in 1999 (31) RLT M61]. He referred to the relevant amendment (7/99-CE(NT) dt. 29.2.99) which is as under:-
"7/99-CE(NT), dt. 9.2.1999: In exercise of the power conferred by Section 37 of the Central Excise Act. 1944 (1 of 1944), the Central Government hereby makes the following rules further to amend the Central Excise Rules, 1944 namely:-
1 (1) These rules may be called the Central Excised (3rd Amendment) Rules, 1944.
(2) They shall come into force on the date of their publication in the official Gazette.
2. In the Central Excise Rules, 1944,-
(a) in rule 57G, after sub-rule(10), the following sub-rule shall be inserted, namely,-
"(11) Credit under sub-rule (2) shall not be denied on the grounds that-
(i) any of the documents, mentioned in sub-rule(3) does not contain all the particulars required to be contained therein under these rules, if such document contains details of payment of duty, description of the goods, assessable value, name and address of the factory or warehouse;
(ii) the declaration filed under sub-rule (I) does not contain all the details required to be contained therein or the manufacturer fails to comply with any other requirements under sub-rule (1):"
He submitted that circulars are binding on the authorities functioning under statue Referring to the Circular No. 441/7/99 dated 23.2.99, he said that Circular was issued to follow certain guidelines in respect of Notification No. 7/99 dated 9.2.99 while considering the admissibility of modvat credit and further it was specified in the circular that guidelines are applicable to the pending cases and the pending case are to be disposed of accordingly. In this context, he referred to the decision of the Supreme Court in the cases of Mathew M.Thomas Vs Commissioner of Income Tax reported in 1999 (33) RLT (SC)=1999 (111) ELT 4 (SC) wherein it was held that proceedings shall include proceedings at the appellate stage. Particularly, he drew our attention to the para 8 of the said judgement which reads as under:-
"8. It is well settled that the word "Proceedings" shall include the proceedings at the appellate stage. It is sufficient to refer to the judgement of this Court in Garikapati Veeraya V.N. Subiah Choudhary & Ors. - AIR 1957 S.C. 540 wherein the Court said at page 553:-
(i) That the legal pursuit of a remedy, suit appeal and second appeal are really but steps in a series of proceedings all connected by tan intrinsic unity and are to be regarded as one legal proceedings".
Hence we are unable to persuade ourselves to agree with the view expressed by the Full Bench of the High Court in the Judgement under appeal that the Circular would apply only to proceedings pending before the Competent Authority".
We are not convinced with the arguments advanced on behalf of the Revenue that amended provisions and Circulars referred to above are not applicable to the point in issue. On going through the amendment to Rule 57G particularly with reference to sub-clause II of 2(a) of 7/99-CE(NT) dated 9.2.99 the Circulars and the case law, we find that matter is required to be re-examined as it was rightly pointed out by the intervener. In the view we have taken, the matter is remanded to the Jurisdictional Assistant Commissioner to examine the admissibility of modvat credit for the period covered under Appeal No. E/1840/95 and to pass an order in accordance with law."
5. In view of above decision, the impugned order is set aside and the matter is remanded to the adjudicating authority for deciding afresh after affording an opportunity of personal hearing to the appellants. (Dictated in Court).