ORDER
K. Sankararaman, Member (T)
1. This is an appeal by M/s. Delhi Bottling Company Pvt. Ltd. against Order-in-Appeal No. 1128-CE/APPL/DLH/90, dated 30-11-1990 passed by Collector of Central Excise (Appeals), New Delhi whereby he had held the order-in-original dated 13-7-1990 passed by Assistant Collector of Central Excise MOD III, New Delhi insofar as the latter authority had held them to be ineligible for Modvat Credit to the extent of Rs. 1,91,490.24 on glass bottles manufactured by M/s. J.G. Glass Limited but received by them (appellants) from M/s. Arizona Printers and Packers (P) Limited. It was denied on the ground of absence of any endorsement on the Gate Pass or of a subsidiary Gate Pass and also on the ground that the bottles were not received in their original packing.
2. In the appeal it has been urged that Arizona Printers & Packers (P) Limited who did the printing on the bottles and supplied them to the appellants as stated in the show cause notice itself had necessarily to unpack the original packing in which the manufacturers, M/s. J.G. Glass had supplied the plain bottles. M/s. Arizona Printers who were not Central Excise licencees had made suitable endorsement in the Gate Pass. It is submitted that the inputs on which they took Modvat Credit were the bottles on which the manufacturers, J.G. Glass Limited had paid duty as shown in the Gate Passes. The procedural requirement which was impossible of compliance deserved to be condoned as held by the South Regional Bench of the Tribunal in Sundram Fasteners v. Collector of Central Excise reported in 1986 (8) ETR 754 so that substantive justice was not denied on account of an alleged unmeant procedural lapse. They have cited the following decisions in further support of their contention :-
(I) SBS Organics Pvt. Ltd. v. C.C.E. – 1990 (45) E.L.T. 701 (Tri.).
(II) Maschmeijer Aromatics (I) Ltd. v. Collector of Central Excise -1990 (46) E.L.T. 395 (Tri.).
(III) Soft Beverages P. Ltd. v. CCE -1989 (44) E.L.T. 66.
It is then contended that the lower authorities had erred in facts about the endorsement on the Gate Passes as the same did bear endorsement of the supplier (Arizona Printers & Packers) on the Gate Pass, a photocopy of which was enclosed by them to the appeal. Accordingly it has been pleaded that the appeal be allowed.
3. Shri D.N. Mehta, learned Counsel for the appellants referred to the grounds taken by them in the appeal. He pleaded that the appeal be allowed. He stated that he had no objection if the matter is remanded to the Assistant Collector for de novo decision after scrutiny of documents.
4. Heard Shri Sanjeev Sachdeva, learned Senior Departmental Representative.
5. We have considered the submissions. We have taken note of the decision cited. We also find that while arguing their stay petition, a reference was made to the Tribunal decision in the case of Madras Fabricators Ltd. v. Collector of Central Excise reported in 1990 (47) E.L.T. 292. That was a case where the declared inputs were lacquered sheets whereas Modvat credit taken was of the duty paid on tin sheets. These were directly sent for lacquering outside their factory and then brought there for manufacture of their final product. It was observed by the Tribunal that no further duty had been charged or was payable on lacquering of the tin sheets and the duty paid towards lacquered sheets was the duty paid on the plain tin sheets. It was, therefore, held that if it could be established with the help of evidence produced that the duty taken into consideration for the purpose of taking Modvat credit reflected the quantum of duty paid towards the lacquered sheets by way of the duty paid on the plain sheets then no fault can be found with the appellants for having availed of Modvat credit as the credit actually availed of was in respect of the lacquered sheets which were the declared input. The appeal was, therefore, allowed remanding the matter for de novo examination for decision by correlating the duty paid towards the plain sheets which had gone for lacquering and which could be correlated with the lacquered sheets.
6. We find that the case of the appellants is on stronger grounds. The declared inputs were glass bottles. Whether plain or printed they are only glass bottles. Printing the bottles with the name of the manufacturer and of the product, which is a marketing necessity does not constitute a manufacturing process converting the bottles into another distinct product. The lacquered sheets – tin sheets difference and the problem of the declared input being different from the material covered in the duty paying document that was there in the Madras Fabricators case is not before us now in the present case. As stated above, the declaration tinder Rule 57G covered glass bottles which is what they received after printing of the names. The adverse decision in question had been taken by the lower authorities on two grounds namely (1) non-endorsement of the Gate Passes or non-production of subsidiary Gate Passes (2) the supply of the goods not in the original packing of the manufacturers of the bottles. As regards the first deficiency, the appellants have enclosed a photocopy of the Gate Pass of J.G. Glass endorsed in favour of the appellants by them. This is found to cover 25000 bottles involving duty of Rs. 9,400/-. The total quantity and duty involved in the matter is more. The required Gate Passes have to be looked into for which remand of the case to the Assistant Collector as suggested by Shri Mehta, learned counsel, would fill the bill. We are inclined to accept the plea. But before ordering accordingly, we would like to observe that the matter is not really a question of endorsed Gate Pass. That would be in order where the goods are cleared from a factory on a Gate Pass to a buyer who then sell, the same to a manufacturer availing Modvat credit and endorses the Gate Pass in favour of the latter or issues a subsidiary Gate Pass attested by jurisdictional Superintendent of Central Excise. Here, however, it is not a case of sale of the bottles received from the manufacturer as such, the supply is of the bottles after printing the required particulars thereon. This necessitated unpacking the bottles and repacking after that work is over. This is a case of job work done on behalf of the appellants by the printer and the required procedure under the relevant provisions of Rule 57F should have been followed by the appellants and the job worker which has not been. But the appellants have not been proceeded against on that ground. We are inclined to condone the lapse in question. While ordering so we remand the matter to the Assistant Collector for de novo examination with reference to the evidence put up by the appellants to correlate the printed bottles received by them with the duty paying documents issued by the manufacturers of the bottles and the endorsements and certificate, if any, issued by the job worker. The appeal is allowed on the above terms.