ORDER
S.L. Peeran, Member (J)
1. E/972/2003
1. This appeal arises from OIA No. 84/2003(V-I)CE dated 16.07.2003 which covers the period 1997 to 1999. The total credit disallowed is Rs. 2,17,890/- and penalty of Rs. 20,000/- has been imposed. The appellants are not contesting the duty amount of Rs. 54,846/- and submit that the balance amount of Rs. 1,63,844/- is covered in their favour and credit to that extent should be granted. They are also seeking for waiver of penalty.
2. I have heard both sides in the matter.
(a) An amount of Rs. 3,461/- was denied as credit had been taken on original invoice. The appellants are not entitled to avail modvat credit on original invoice and the rejection is upheld.
(b) Credit of Rs. 537/- has been dis-allowed on the ground that they have not declared the item. In terms of the Larger Bench judgment rendered in the case of Kamakhya Steels (P) Ltd. v. CCE, Meerut , the non-declaration is condonable. Hence, modvat credit of this amount is allowed.
(c) Modvat credit of Rs. 31,950/- has been denied on the ground that the input Chemical falling under CH 3824.90 is not covered by Rule 57Q. The appellants claim the item to be an input and hence is eligible for the credit. They further submit that the issue is covered by the ruling of the Larger bench rendered in the case of CCE v. Modi Rubber Ltd. . In view of this judgment, the credit availed is allowed.
(d) Credit of Rs. 35,023/- has been denied on the ground that they have not filed the declaration. In view of the Larger Bench judgment rendered in the case of Kamakhya Steels (P) Ltd. v. CCE, Meerut (supra), the non-filing is condonable and credit is allowed.
(e) Credit of Rs. 348/- has been denied on the ground that the same was not declared. The credit in this case is also allowable in the light of the Larger Bench judgment cited supra.
(f) The appellants are not contesting with regard to credit of Rs. 3,754/- denied on the ground that it was not declared and also that it was not covered by Rule 57Q. The denial of this amount is upheld. So also with regard to the credit of Rs. 7,917/-, which has been denied on the same ground also upheld and the item is not covered by Rule 57Q.
(g) With regard to the credit of Rs. 13,637/- , the declaration filed by them was not tallying with the description given in the invoice. The appellants contend that this is also a procedural lapse which is condonable in the light of the Circular dated 23.02.1999 and the Larger Bench judgment rendered in the case of Kamakhya Steels (P) Ltd. v. CCE, Meerut (Supra). In view of this position, the denial of modvat credit is not justified. The credit is allowed.
(h) The appellants are not contesting the amount of Rs. 4,800/- as the item is not covered in terms of Rule 57Q. The denial of modvat credit of this amount is upheld.
(i) An amount of Rs. 34,914/- has been denied as it has been taken on original invoice. The denial is justified and it is upheld.
(j) An amount of Rs. 81,549/- has been denied as installation certificate has not been produced. The Tribunal, in the case of Hind Spinners Industries Growth Centre v. CCE, Indore 1997 (96) ELT 651 (Tribunal) has held that installation certificate is not mandatory for grant of the benefit. In view of this judgment, the modvat credit is allowed.
3. In sum, the appellant are entitled to modvat credit of Rs. 1,63,844/- and modvat credit of Rs. 54,846/- is denied. The appeal is disposed of in the above terms. Penalty of Rs. 20,000/- has been reduced to Rs. 5,000/-.
In the above matter, modvat credit has been allowed in respect of Capital Goods which have been received in the factory and duty has been paid. However, they have not filed declaration. In view of the judgment rendered in the case of Kamakhya Steels (P) Ltd. v. CCE, Meerut (Supra) which has been further, clarified by the Mumbai Bench in the case of J.B.M. Tools Ltd. v. CCE, Pune , the appeals are disposed of in the above terms.
E/973/2003
4. The issue in this appeal pertains to availing of modvat credit on original invoice. The appellants are not contesting the appeal and the same is rejected.
E/974/2003
5. This appeal pertains to rejection of modvat credit of Rs. 55,346/- and imposing penalty of Rs. 5,000/- on the ground that they have taken modvat credit on original invoice. The appellants contend that they later produced 6 duplicate invoices and the same has not been verified and hence prayed for remand.
6. The learned SDR has no objection to remand the matter pertaining to verification of 6 duplicate invoices produced. Further, he submits that duty of Rs. 333/- is required to be confirmed as it pertains to availing modvat credit on short receipt of inputs. The learned Consultant has no objection for upholding this portion of the order. The modvat credit availed on short receipt of inputs to the extent of Rs. 333/- is confirmed and the matter pertaining to availing modvat credit on original invoices is remanded for de novo consideration to the original authority who shall verify the matter with regard to subsequent production of duplicate invoices and pass a detailed order by following the Principles of Natural Justice.
E/975/2003
7. This appeal pertains to denial of Modvat credit of Rs. 34,855/- and imposing penalty of Rs. 5,000/- for availing excess credit on petroleum product short received and also for availing modvat credit on original invoice. The learned Consultant does not contest this matter. This appeal is dismissed.
E/976/2003
8. In this appeal, the appellants are contesting the imposition of penalty of Rs. 50,000/- . The duty of Rs. 12,56,002/- was deposited before the issue of Show Cause Notice except a small amount of Rs. 2,301/- , which was deposited after the issue of Show Cause Notice. They are only contesting the imposition of penalty of Rs. 50,000/-. In view of the following judgments, the imposition of penalty is set aside by allowing the appeal.
(i) CCE v. Machine Montell (I) Ltd.
(ii) CCE, Mangalore v. Shree Krishna Pipe Industries
(iii) Rashtriya Ispat Nigam Limited v. CCE – affirmed by the Apex Court as quoted in 2004 (163)ELT A53(SC).
E/977/2003
9. The appellants have taken Modvat credit without producing the installation certificate. This issue is covered by the judgment rendered in the case of Hind Spinners Industries Growth Centre v. CCE, Indore 1997 (96) ELT 651 (Tribunal) and, therefore, the non-grant of modvat credit on this ground is set aside. However, an amount of Rs. 4,995/- pertains to taking modvat credit on original invoice, which is upheld. So also with regard to availing modvat credit without filing declaration to an extent of Rs. 15,499/- . is allowed in the light of the Larger Bench judgment rendered in the case of Kamakhya Steels (P) Ltd. v. CCE, Meerut (Supra) which has been further clarified by the Mumbai Bench in the case of J.B.M. Tools Ltd. v. CCE, Pune . An amount of Rs. 4,85/- is allowable as the item is an eligible input and not Capital Goods as held in the case of CCE v. Modi Rubber Ltd. . Thus, this appeal is partly allowed as stated above. As the appeal has been partly allowed, penalty of Rs. 6,000/- is reduced to Rs. 500/- only.
E/978/2003
10. The issues involved in this appeal are as follows:-
(a) The appellants have taken Modvat Credit on Bellow. The Consultant submits that the order is correct and hence, Modvat credit availed on Bellow, as denied by the authorities, is upheld.
(b) The appellants are also not contesting these matters wherein the goods are not covered as Capital Goods under Rule 57Q. The availment of modvat credit on those items which are not covered as Capital Goods under Rule 57Q is also upheld.
(c) An amount of Rs. 26,775/- pertains to eligible input. Although it is not covered by Rule 57Q, in terms of CCE v. Modi Rubber Ltd. the credit is allowable.
(d) The appellants have been denied Modvat credit for not producing installation certificate, which is not correct in view of Hind Spinners Industries Growth Centre v. CCE, Indore case noted supra. The Modvat credit denied on this ground is set aside which works out to Rs. 7,851/- only.
(e) The amounts of Rs. 3,544/- , Rs. 624/- , Rs. 13,428/- , Rs. 4,655/- , Rs. 6,615/- , Rs. 1,31.470/- , Rs. 90,220/- , Rs. 35,412/- , Rs. 967/- , Rs. 1,934/- , Rs. 8,161/- and Rs. 4,779/- have been denied on the ground that the Chapter Heading has been wrongly described. The duty paying nature is not in dispute. In view of Tribunal ruling rendered in the case of Chemicals & Plastics India Ltd. v. CCE, Trichy 2000 (124) ELT 1103 (Tribunal), the denial of modvat credit of these amounts are set aside.
(f) The denial of modvat credit of Rs. 1,058/- on extra copy is upheld as the same is not available to them.
(g) With regard to the modvat credit of Rs. 12,960/- , which has been denied on the ground that it is not covered as Capital Goods, the denial is justified and is upheld.
(h) An amount of Rs. 1284/- & Rs. 1,584/- pertaining to non-coverage under Rule 57Q is upheld.
(i) An amount of Rs. 545/- is also allowable although not declared, in the light of J.B.M. Tools Ltd. v. CCE, Pune .
(j) The penalty of Rs. 50,000/- is reduced to Rs. 10,000/-.
E/979/2003
11. The following amounts are not contested and the modvat credit denied on these amounts is upheld.
(a) Rs. 772/- on the ground that the input document is not in the name of appellant
(b) Rs. 13,484/- Item is not Capital Good
(c) Rs. 5064/- – Item not covered as Capital Good
(d) Rs. 25,587/- – Item not covered as Capital Good
(e) Rs. 3,528/- – Item not covered as Capital Good
(f) Rs. 3,779/- – Credit taken on original copy of invoice
12. The following amounts availed as Modvat credit are upheld.
(a) Rs. 1,843/- – The item had not been declared. However, the duty paying nature of the document and availability of the modvat credit is not denied by the Revenue. Hence, the claim is accepted.
(b) Rs. 9,244/- – This amount has been denied on the ground that they have not produced installation certificate and the description of the item is not mentioned. However, the duty paying nature is not denied and so also the item being a Capital Good. The item falls under CH 9032.99 which is also covered under Rule 57Q. Therefore, in the light of the Tribunal rulings rendered in the case of J.B.M. Tools Ltd. v. CCE, Pune and Hind Spinners Industries Growth Centre v. CCE, Indore(supra), the credit is allowed.
(c) Rs. 2,901/- The appellants had not declared the Capital Goods falling under CH 8413.19. In the light of the Tribunal ruling rendered in the case of J.B.M. Tools Ltd. v. CCE, Pune (supra), the benefit cannot be denied.
(d) Rs. 3,888/- The appellants had not declared the item. However, its duty paying nature and the item being Capital Goods is not denied. Hence, the benefit is required to be accepted in the light of J.B.M. Tools Ltd. v. CCE, Pune (supra).
(e) Rs. 13,500/- The appellants have declared the item as Capital Goods, which was denied. However, it was a Chemical falling under Sub-Heading 3926.90. The benefit is required to be extended in the light of the Tribunal ruling rendered in the case of CCE v. Modi Rubber Ltd. . The modvat credit is allowed.
(f) The amount of Rs. 6,626/- is required to be allowed as the same was denied on the ground that the appellant had not produced the installation certificate in the light of the Tribunal ruling rendered in the case of Hind Spinners Industries Growth Centre v. CCE, Indore (supra). The benefit is extended.
(g) Penalty imposed to an extent of Rs. 10,000/- is reduced to Rs. 2,000/-.
E/980/2003
(a) In this matter, the modvat credit has been denied on the ground that they have not filed the installation certificate. The amounts which have been denied on this ground are covered by the Tribunal ruling rendered in the case of J.B.M. Tools Ltd. v. CCE, Pune (supra). Therefore, the denial of modvat credit on the ground that they have to produce installation certificate is set aside.
(b) In so far as the denial of modvat credit taken on original invoice is concerned, the same is not contested and the order is confirmed.
(c) An amount of Rs. 3,733/- has been denied as they are not Capital Goods. This is not contested and hence the denial is confirmed.
(d) Penalty of Rs. 10,000/- imposed in this matter is reduced to Rs. 2.000/-
(Pronounced and dictated in open Court)