ORDER
Smt. Archana Wadhwa
1. The Revenue has field the present appeal, being aggrieved with the order passed by Commissioner(Appeals). I have heard Shri V.K.Chaturvedi, ld.SDR and Shri B.N.Chattopadhyay, ld.consultant for the respondents.
2. The appellant filed a declaration under rule 57G on 7.4.98 in respect of his inputs slack wax to be used in the manufacture of paraffin wax and residue wax. Subsequently on 21.7.98 they field a declaration under the provision of rule 57H in respect of the inputs as available with them on 31.3.98 as also in respect of finished product in stock on the said date. The Asstt.Commissioner of Central Excise in his impugned order rejected the appellants’ claim under the provision of rule 57H in two grounds. Firsts he observed that the declaration under 57H was not filed immediately before obtaining the dated acknowledgment of declaration under rule 57G. Secondly he rejected the claim in respect of 7.5 M.T. paraffin wax and 20 M.T. residue wax shown to have been manufactured in the month of March 1998 on the ground that no raw material has been issued in that month for the production of the said final product. The Commissioner(Appeals) in his impugned order, after taking note of the provisions of rule 57H observed as under:-
“Here “Immediately before” means inputs lying in stock before the receipt of dated acknowledgment and available for verification. Such an opinion has been held by the Honourable CEGAT in the case of Soft Beverages Pvt.Ltd.v.Collector-1989(44)ELT 66(Tri).
I also find that there is no time limit specified for filing application under rule 57H, which is also the finding of the Hon’ble CEGAT in the case of Swastika Metal Works v. Collector-1991(56)ELT 566(Tribunal). So, the rejection of claim under rule 57H on the ground of delayed submission of application is not sustainable.
The Asst.Commissioner has held that credit should not be allowed on 7.5 M.T. of paraffin wax and 20 M.T. of residue wax because though manufacture has been shown in March, 1998 yet no issue of raw material has been shown in that month. The appellant has submitted that the splitted wax accumulated for long was used for the manufacture in that month, an argument which sounds convincing. So, I allow the MODVAT credit on this count because they have shown the manufacture of paraffin wax and paid central excise duty and sales tax on it.Since finished product can not be manufactured without raw materials, it is reasonable to hold that raw material has been used in making it”.
3. The Revenue in their memo of appeal have reiterated that the expression immediately before as appearing in rule 57H means filing of declaration immediately before rule 57G declaration. However, the above contention is not acceptable inasmuch as a reading of rule 57H makes it clear that the expression immediately before refers to the inputs and not to the declaration. This has also been so held by the Tribunal in the case of Soft Beverages relied upon by Commissioner(Appeals).
4. As regards the doubt the production of final products lying in stock as on March, 1998, I find that the Commissioner(Appeals)has rightly observed that the said final products have been entered in records and duty has been paid upon the same. The Revenue’s contention that the said production was shown to avail the undue modvat credit claim does not appeal on the face of it inasmuch as it the appellants are showing production of a final product, they will also have to pay duty on the same. As such no motive can be seen into the said production which according to the Revenue has actually been produced. If that be the case, then the respondents are also not required to pay any duty on the said final product.
5. In view of the foregoing I do not find any merits in the Revenue’s appeal and reject the same.
(Pronounced)