ORDER
Gowri Shankar, Member (T)
1. The applicant is absent and unrepresented despite notice. I have read the stay application, memorandum of appeal, and other papers and heard the Departmental Representative and thereafter I propose to take up the appeal itself for disposal, after waiving deposit.
2. The appellant is a manufacturer of valves. It sent out parts of its inputs for further processing and return. In accordance with Sub-rule (6) of Rule 57F, it deducted 10% of the value of the inputs in its personal ledger account (PLA). On the goods being returned to it, it took credit of the amount in the same account. This was objected to by the Department, which resulted in issue of notice, culminating in an order of the Assistant Commissioner, whose order has been confirmed by the Commissioner (Appeals). In that order, the Assistant Commissioner has held that whether debit was made in the PLA or RG 23A account, the credit of the amount so deducted could, on the receipt of the inputs after processing, be made Only in the RG 23A or Modvat account. He also imposed a penalty of Rs. 2000/- on the appellant. This appeal is against that order.
3. Although the Assistant Commissioner deals with two appeals, the appellant has filed only one appeal. I therefore treat it as an appeal against the order 190 of 2000 the number first mentioned.
4. The contention in the appeal is that there is no specific requirement that when the inputs are received back, credit cannot be taken in the PLA is not acceptable. Sub-clause (2) of Sub-rule (6) of Rule 57F referring to the debit to be made when the inputs are sent says, “The debit shall be made in the account maintained under Sub-rule (6) of Rule 57G, of the account current maintained in Rule 9 or Sub-rule (1) of Rule 173.” Sub-rule (7) provides, “Notwithstanding anything contained in Rule 57F, the manufacturer shall be eligible to take credit of an amount equal to the amount debited by him under Sub-rule (6) when the inputs or partially processed inputs, as the case may be, received back in full in its factory, in the account maintained under Sub-rule (6) of Rule 57G.” It is clear from these provisions that while debit can be made when the goods are sent out either in the RG 23A account or in the PLA, credit of the duty debit so made can be taken only in the RG 23A account. The reason for this distinction in the mode of credit is not specified. However, that is the legislative provision and that provision has to be given effect to by this Tribunal. It would thus follow that the action of the appellant in taken the credit in the PLA on return of the goods was contrary to law.
5. The Assistant Commissioner’s order permitting debit of the PLA and on such debit credit should be taken on the Modvat account is therefore perfectly in order. However, I do not find any case for imposition of penalty on the appellant and accordingly set aside the penalty of Rs. 2000/- imposed on it.