Customs, Excise and Gold Tribunal - Delhi
Indo National Ltd. vs Collector Of Central Excise on 11 December, 1996
Equivalent citations: 1998(101)ELT610(TRI-DEL)
ORDER Lajja Ram, Member (T)
1. In this appeal filed by M/s. Indo National Ltd., the issue for our consideration is the eligibility of the goods, "zinc callots" to the benefit of Notification No. 152/86-C.E., dated 1-3-1986, when the credit of duty paid on the aluminium ingots out of which such zinc callots have been manufactured had been taken on a date subsequent to the clearance of such zinc callots. There is no dispute that the credit of the duty paid on the aluminium ingots out of which the zinc callots have been manufactured had been taken by the appellants. They have contended that when the zinc callots were removed from their factory, they had not received the duty paying documents from the MMTC and they took credit for the full quantity including the quantity used in the manufacture of zinc callots already removed on receipt of the duty paying documents from the MMTC. The adjudicating authority had held as under:
"I have gone through the records of the case and also considered the submissions made by the company at the time of hearing subsequently. It is seen that during the month of March, 1986, the company had removed zinc callots paying duty at the concessional rate of Rs. 1,625/-. However, the notice has alleged that inasmuch as the company had availed credit of duty paid on the ingots with which the callots had been manufactured, the company is not entitled to pay duty at the concessional rate but is required to pay duty at higher rate of Rs. 5,226/- per M.T. In reply to the notice, the company had pleaded that during the period from 1-3-1986 to 1-4-1986 credit of duty on zinc ingots had not been availed under Rule 57A. Sri Janaki Rani Reddy, at the time of personal hearing has categorically stated that the credit was taken only on 29-3-1986 or 2-4-1986.1 have examined the relevant extracts of RG 23A filed by the company in this regard. It is seen that although the company had not taken credit immediately on receipt of inputs the credit of duty paid on the ingots used in the manufacture of callots in this month was actually taken on or after 28-3-1986. The delay in taking the credit has been explained as due to late receipt of the duty paying documents from MMTC. With regard to the argument that at the time of payment of duty on the callots, credit of duty paid on the ingots had not been availed, I find that there is no merit in this argument inasmuch as the ingots on which credit of duty had been availed, though at a later stage, had been utilised in the manufacture of zinc callots, the zinc callots should have discharged duty at the higher rate. It is equally incumbent that the duty having been discharged at the lesser rate on the zinc callots the company should not have availed credit at later date, of the duty paid on the zinc ingots. The company was aware that it was manufacturing zinc callots out of duty paid zinc ingots and if credit of duty paid on the ingots was intended to be availed duty at the higher rate should have been adopted at the time of payment of duty on zinc callots."
2. The matter was posted for hearing on 11-12-1996. No one is present for the appellants. The notice for today's hearing had already been served on them. There is no response. There is no request for adjournment. In the circumstances, we are proceeding to deal with the matter on merits after hearing Shri M. Jayaraman, JDR.
3. Shri M. Jayaraman, JDR, referred to the Exemption Notification No. 152/86-C.E. and submitted that the credit of duty paid on zinc ingots had already been taken by the appellants and thus the zinc callots in question were not eligible for the concessional rate of duty.
4. We have carefully considered the matter. Notification No. 152/86- C.E., dated 1-3-1986 is extracted below :
SPECIFIED GOODS OF ZINC [CHAPTER 79] In exercise of the powers conferred by Sub-rule (1) of Rule 8 of the Central Excise Rules, 1944, and in supersession of the notification of the Government of India in the Ministry of Finance (Department of Revenue) No. 180/84-Central Excises, dated the 1st August, 1984, the Central Government hereby exempts goods of the description specified in column (3) of the Table hereto annexed and falling under sub-heading Nos. of the Schedule to the Central Excise Tariff Act, 1985 (5 of 1986), specified in the corresponding entry in column (2) of the said Table, from so much of the duty of excise leviable thereon which is specified in the said Schedule as is in excess of the amount calculated at the rate specified in the corresponding entry in column (4) thereof.
TABLE
______________________________________________________________
S. No. Sub-heading Description of goods Rate
No.
______________________________________________________________
(1) (2) (3) (4)
______________________________________________________________
1. 7901.00 Unwrought zinc in any form Nil
7903. and including blocks, plates,
ingots, cakes, bars,
billets, hard or soft slabs,
cathodes, anodes,pellets,
spalter and broken zinc;
wrought bars and rods
(including wire rods)
of zinc.
2. 7903.20, Wrought angles, shapes and Rs. 600
7904.10 sections of zinc, wrought
and 7904.90 plates, sheets, blanks per
(including circles but
excluding callots) tonne
and strips of zinc;
zinc foil.
3. 7905.00 Zinc callots. Rs. 1,625
per tonne
Provided that the said goods are made from zinc and articles thereof (hereinafter referred to as "inputs"), falling under the Heading Nos. 79.01 to 79.08 of the said Schedule and on which the duty of excise leviable Under Section 3 of the Central Excises and Salt Act, 1944 (1 of 1944) or the additional duty leviable under the Customs Tariff Act, 1975 (51 of 1975), as the case may be, has already been paid :
Provided further that no credit of the duty paid on the said inputs has been taken under Rule 56A or Rule 57A of the said rules :
Provided also that nothing contained in this notification shall apply to zinc and articles thereof produced or manufactured by a primary producer.
Explanation. - For the purposes of this notification, -
(1) the expression ".primary producer" means any person licensed or registered under the Industries (Development and Regulation) Act, 1951 (65 of 1951), who produces zinc from zinc ore or zinc ore concentrates, (2) all stocks of inputs in the country except such stocks as are clearly recognisable as being non-duty paid, shall be deemed to be inputs on which the duty has already been paid.
[Notification No. 152/86-C.E., dated 1-3-1986]
5. We consider that the basic question is, whether the credit of the duty paid on the zinc and articles thereof had been taken under Rule 56A or Rule 57A of the Central Excise Rules, 1944. The credit had been taken admittedly in respect of the inputs (although at a later date) and such credit in respect of the final products made a manufacturer ineligible to the benefit of the above notification. In the present case, the appellants did not receive duty paying documents from MMTC, although they utilised such inputs in the manufacture of zinc callots. They availed of the benefit of concessional rate of duty even when they took credit of the duty paid on the inputs which had gone in the manufacture of such zinc callots.
6. In the facts and circumstances of the case, we find that the learned adjudicating authority had taken a correct view in the matter and that there is no merit in this appeal.
7. As a result, the appeal is rejected.