Customs, Excise and Gold Tribunal - Delhi
Collector Of Central Excise vs Zoloto Industries on 29 December, 1995
Equivalent citations: 1996(83)ELT162(TRI-DEL)
ORDER G.R. Sharma, Member (T)
1. The Collector, Central Excise, Chandigarh has filed this appeal being aggrieved by the order passed by the Collector (Appeals). The Collector (Appeals) in his order had permitted the refund of duty accumulated in RG-23A Part II register on account of the respondents herein opting out of the Modvat Credit Scheme to that of availing exemption as SSI unit. The credit of duty would have accrued to the respondents herein had they taken higher deemed modvat credit admissible to them.
2. Briefly stated the facts of the case are that the respondents herein are engaged in the manufacture of gun metal valves and cocks and were availing modvat credit facilities on inputs used for the manufacture of the above finished product. They applied for refund of Rs. 4420/- in respect of balance in their RG 23A Part II register up to 16-7-1990 and receipt from 16-7-1990 to 24-8-1990. The Asstt. Collector rejected their claim for refund of credit of Rs. 4420/-. However, the Collector (Appeals) allowed the request of the respondents herein on the ground that the Department has not made out a case that the claim of the respondents herein was inadmissible. Against this order of Collector (Appeals), the Department has come up in appeal on the ground that Rule 57F(3) of the Central Excise Rules, 1944 lays down the manner of utilization of credit of specific duty and that in this Rule there is no provision that refund of duty accumulated as modvat credit in RG-23A Part II can be granted except in case of export.
3. Shri P. Das, the learned SDR is present for the appellant. None is present for the respondents. As the issue is a short one and is based purely on interpretation of Rules, therefore, it was decided to proceed with the matter even in the absence of the respondents.
4. Shri P. Das, the learned SDR submitted that the duty accumulated on account of inputs used in the finished product which are exported, can be refunded; that there was no provision in the Modvat Credit Rules for refund of duty on account of non-utilization of a part thereof. He submitted that the Collector (Appeals) had grossly erred in holding that refund was admissible to the respondents herein. The learned SDR also submitted that the manner of utilization of modvat credit was specifically laid down in Rule 57F and there was no provision for refund as claimed by the respondents herein.
5. Heard the submissions of the learned SDR and perused the orders passed by the lower authorities. I find that the only Rule, under Central Excise Rules laying down the procedure for utilization of modvat credit is Rule 57F. Rule 57F(3) does provide for refund of credit of duty paid on inputs in the circumstances stated therein. As there is no provision for refund of duty except the one pertaining to the finished product being exported, I find that the finding of the Collector (Appeals) is not justifiable in law. Having regard to this view, I hold that the refund was not admissible to the respondents herein. Accordingly, the impugned order is set aside and the appeal is allowed.