Customs, Excise and Gold Tribunal - Mumbai
Mahindra Ugine Steel Co. Ltd. vs Commissioner Of C. Ex. on 23 January, 1996
Equivalent citations: 1996(87)ELT265(TRI-MUMBAI)
ORDER R. Jayaraman, Member (T)
1. After hearing both the sides, since the matter calls for a remand back to the Assistant Commissioner, we have taken up the appeal itself for disposal waiving the requirement of predeposit of duty amount.
2. Both the appeal as well as the stay application are directed against Order-in-Appeal No. CS-540/B.III/95, dated 12-11-1995 passed by the Commissioner of Central Excise (Appeals), Bombay.
3. The issue relates to availment of Modvat credit in respect of certain imported materials received by the appellants on the basis of endorsed Bills of Entry. The only allegation against these documents is that they are not approved documents by the Board under Rule 57G of the Central Excise Rules. The goods were imported by M/s. Ishar Alloys Steel Ltd., Indore and Mukand Ltd., Kalwe. Both the importers, on the back of the Bills of Entry, have endorsed that the goods imported are sent to the appellants and they are not claiming any Modvat benefit in respect of these goods against the original triplicate copies of the Bills of Entry. The goods are reported to have been received in the appellant's factory, on the basis of which Modvat credit was taken. It was objected to by the department on the ground that these are not high sea sales and only in the case of high sea sales, such an endorsement is permitted and not in the case of local transfers for which they should have obtained a certificate from the competent officer regarding the duty payment and other particulars covered by the Bills of Entry, which is the authorised document.
4. After hearing both the sides and perusing the Bills of Entry and the certificates issued by the jurisdictional Superintendent to the importers, we find that the jurisdictional Superintendent has certified that the goods covered by the Bills of Entry have not been received by the importers and no Modvat credit has been taken by the importers in respect of these goods. We also find on the reverse of the Bills of Entry endorsements regarding sending these materials to the appellants with a declaration that they are not availing Modvat credit in respect of the same goods. Shri Gunasekharan, the ld. Advocate during the hearing pleaded that earlier they had loaned the same quantity of goods and these loaned materials are now returned to them and that is why transfer has been made. When in respect of these materials the Jurisdictional Superintendent at the importers' end has certified that no Modvat credit has been taken and these materials have not been received by the importers, this would prima facie indicate that the goods imported, which have suffered duty, have been received as inputs and utilised for further manufacture. The appellants would be in a position to produce all the correspondence regarding loan arrangement and also for establishing the movement of the goods earlier on loan basis to those importers, in respect of which the materials are now returned. This will establish a complete nexus of the link with the imported goods and also establish that the very same imported goods have been received in the factory of the appellants. Since documents are voluminous, he would plead for a remand so that these documents could be appreciated. Shri Gurdeep Singh the ld. JDR pleads that in any case the legal requirement is a certificate issued by the Supdt. and not an endorsement. The Board is competent to prescribe the documents as per Rule 57G of the Rules. When such a document is not produced, the question of going into other evidence does not arise.
5. After hearing on this issue, we find that the documents prima facie indicate that the imported materials, which have suffered duty have been transferred by the importers to the appellants. Whether it is a case of return of loan or otherwise is a matter to be looked into, for which evidences have to be produced by the appellants before the adjudicating authority. Moreover, some more documents regarding movement of the goods from the appellants to the importers earlier on loan basis are also required to be produced. If these evidences are produced before the Assistant Commissioner, when there is not only endorsements on the Bills of Entry, but also a certificate from the competent officer having jurisdiction over the importers' factory certifying that these goods have not reached the importers factory and Modvat credit has been taken in respect of the goods, the preponderance of these evidence cannot be brushed aside on the technicality of lack of another prescribed certificate from the Supdt. In this view of the matter, we set aside the orders of the lower authorities and remand the case back to the Assistant Commissioner, before whom all the evidences, which are available with the appellants should be produced. The Asstt. Commissioner after taking into consideration these evidence and also the observations made by us, should decide on the eligibility of Modvat credit in respect of these materials imported and transferred to the appellants.
6. Appeal is allowed by way of remand and hence stay application does not survive for consideration and the same is also treated as disposed of.