Customs, Excise and Gold Tribunal - Bangalore
Vikrant Tyres Ltd., Mysore vs The Commissioner Of Central Excise, ... on 16 November, 2001
Equivalent citations: 2002(79)ECC263, 2002(139)ELT69(TRI-BANG)
JUDGMENT
S.S. Sekhon
1. During the period 12.3.87. to 31.7.87., the appellant, a manufacturer of tyres received an input viz. dip fabric. It was alleged that declaration under Rule 57G for this item was filed only on 5.10.87, no records for receipt and utilization of the same were maintained and further as Rule 57E only covers cases where duty credit had allowed on inputs covered and had to be varied later, whereas in the present case no credit was allowed on the said fabric, hence the request for permission to avail credit of duty paid on dip fabric received during 12.7.87. to 31.7.87, was denied.
2. The matter of refusal of this application went up to the Tribunal wherein vide Order No. 915/1994 dated 13.12.94., the same was remanded for reconsideration of the issue afresh. Para-5 of the Tribunal order is as follows:
"5. We have considered the submissions made before us. The issue before us is whether the appellants are entitled to take modvat credit in respect of the inputs in question for the period 12.3.87 to 31.7.87. For the period in question it cannot be disputed by the department that the appellants on the showing of the department itself would not have been in a position to claim or take any modvat credit. The fact remains that for the period in question the Department was assessing and classifying the goods under chapter 54 which is not notified under Rule 57A. The appellants get a cause of action to claim modvat credit only consequent on the change of classification of the goods from chapter 54 to chapter 59 as per the orders of the department or from the date of their knowledge about the revision of the classification whichever is earlier. Therefore, in the light of the evidence on record about the payment of duty and also of differential duty for the inputs in question by the suppliers of the appellants consequent on revised classification and the receipt of the certificate in regard to the same by the appellants, we are inclined to think that the issue, which has not bee examined in this perspective, will have to be remanded for reconsideration. The learned DR at this stage intervened to submit that the appellant's eligibility to modvat credit should also be directed to be considered subject to the bar of limitation of 6 months under law either for taking credit or taking enhanced credit on grounds of variation under Rule 57E. Therefore, the impugned order is set aside and the matter is remanded to the original authority for reconsideration of the issue afresh in accordance with law after affording the appellants a reasonable opportunity of being heard. The appeal is thus allowed by remand".
3. Consequent to this order of the Tribunal, the Asst. Collector in remand proceedings once again disallowed the credit. The Commissioner (Appeals) vide the impugned order has rejected the appeal holding as follows:
"6. Rule 57E deals with the situation where the manufacturer of final products avails of the modvat credit based on duty paid inputs as on a given date and subsequently, the duty paid on inputs is reduced/enhanced for any reason. In the case at hand, on the given date i.e. between 12.3.87 to 31.7.87, the appellants had neither declared the inputs in the Rule 57G declaration nor had they taken any credit of the duty paid on the said dipped chafer fabrics. Therefore the question of allowing any credit in terms of Rule 57E does not arise at all. Further the Hon'ble Tribunal in their order dt. 13.12.94, observed that the cause for action to claim modvat credit arose only consequent to the change of classification as per the orders of the department or from the date of their knowledge about the revision of classification, whichever is earlier. The Hon'ble Tribunal also ordered examination of eligibility of modvat credit subject to bar of limitation of 6 months under law either for taking credit or taking enhanced credit on ground of variation under Rule 57E. From the statement of duty pad, enclosed to the appeal petition it is seen that the appellants are seeking to take modvat credit of duty not taken earlier. The duty has been paid during the period 12.3.87 to 31.3.87 and modvat credit on this amount is sought to taken on 8.8.88 i.e. the date of application filed by the assessee to take modvat credit. As can be seen, it is hopelessly hit by limitation of 6 months. The inputs involved had been received long before the period of six months and hence it is without doubt barred by limitation of time vide Rule 57A and 57G. Therefore on the ground of limitation of time, the appellants are not entitled to modvat credit.
7. The appellant have relied upon decisions reported in 1994 (71) ELT 522 and 1994 (71) ELT 608 while in the first case the appellants i.e. Rajasthan Explosives and Chemicals Ltd. had initially availed modvat credit and subsequently, the question of taking credit of additional duty paid arose. Such is not the case at hand. In this case no duty credit was originally taken. In the second case relied upon i.e. HCL Ltd. v. CCE (1994(71) ELT 508T) the facts and circumstances were entirely different. Rule 57E was not at all in question in that case. Moreover, while the Hon'ble Tribunal has allowed modvat credit after a period of 10 months, it is now settled law that even when there was no time limit prescribed in the modvat rules for taking credit, the period of six months in the limitation period. In the instant case, the period of six months stood long lapsed. This decision also, on this ground too, doe snot come to the rescue of the appellants.
8. Finally, the appellants have also relied on the decision of the Tribunal's reported in 1996 (87) ELT 492 and 1996 (13) RLT 529. In neither of the decisions Rule 57E was under consideration or in question. Reliance can be placed only on cases having similar facts and where similar questions have been decided. Blindly relying on decisions vaguely connected to the case at hand can in no manner advance the appellant case. Hence in my view these two decisions also do not help the appellants case."
4. We have heard both sides and considered the submissions and find:
a) On 12.3.87, a declaration had been made showing impregnated, coated, covered or laminated textile fabrics, textile articles of a kind suitable for industrial use falling under Chapter 59 as inputs being used by them. We also find that Chapter 59 has been declared as an input for Rule 57A with effect from 1.3.87 to 31.3.87, for dip fabrics as inputs, received even though classified under chapter 54 if they pay duty under chapter 59 subsequently due to a classification settlement which was finalised under Chapter 59 subsequent to their receipt. Since the embargo of 6 months under Rule 57G was brought by an amendment subsequent to the period involved in this case and there was no time limit prescribed under Rule 57E for adjustment of credit which in this case was eligible with effect from 1.3.87. Therefore we can not uphold the reasons for rejecting the credit as arrived at by the Ld. Commissioner.
5. In view of our findings, we would therefore set aside the order and allow the appeal with consequential relief.
(Pronounced in the open court on 16/11/2001)