ORDER
G.R. Sharma, Member (T)
1. The learned Collector (Appeals) in the instant case allowed credit of duty paid on inputs described as Indothyne or Indothene LDPE falling under sub-heading 3901.10 but did not allow benefit of input duty credit on the item described as plastic granules falling under Heading 3901.20 and the product described as pilene ultra falling under sub-heading 3901.10 on the ground that the products were not declared in the declaration filed under Rule 57G of the Central Excise Rules, 1944. The learned Collector (Appeals) also upheld imposition of penalty of Rs. 1,000.00. Being aggrieved, the appellant have filed the captioned appeal.
2. The facts of the case are that the appellants are engaged in the manufacture of plastic and products thereof. They procured from the market various inputs. The department alleged that the inputs described as Indothene LDPE, Plastic granules and pilene ultra were not declared in the declaration filed. Accordingly a show cause notice was issued to the appellants asking them to explain as to why Modvat credit taken by the appellants on these inputs should not be disallowed to them and why penalty should not be imposed. The appellants submitted that Indothene LDPE was the trade name of polyethylene, and since polyethylene was declared as an input therefore the allegation that Indothene LDPE was not declared in the declaration was not correct. On the question of declaration of plastic powder the appellants submitted that plastic granules and plastic powder was one and the same thing and therefore it should be treated as declaration of plastic granules. On pilene ultra the appellants submitted that this is a trade name of the manufacturers for polyethylene which has been declared under sub-heading 3909.10 in the declaration filed. After careful consideration of the submissions made the Assistant Collector held that these three products namely Indothene LDPE, plastic powder and pilene ultra were not declared and therefore disallowed Modvat credit on these inputs. In appeal the learned Collector (Appeals) allowed Modvat credit on Indothene LDPE holding that it was nothing but low Density Polyethylene but did not allowed Modvat credit on the remaining two item. Against this order the appellants are before us.
3. Shri H.B. Sharma, advocate for the appellant submitted that plastic powder and plastic granules are one and the same thing and that both are classifiable under sub-heading 3901.10. However learned Counsel on query as to whether he is in a position to adduce any evidence to prove that plastic powder and plastic granules are one and the same thing replied that he could not produce any evidence. On the question of the inputs described as pilene ultra the learned Counsel referred to the certificate wherein they have declared these as manufactures of this product which was their trade name and was actually polyethylene. The learned Counsel submitted that the appellants have already reversed Modvat credit taken on the items described as plastic powder.
4. Learned JDR reiterates the findings of the lower authorities.
5. Heard the submissions of both sides. Since the issue of disallowing Modvat credit on the items described as plastic powder has not been contested before us we do not see any reason to interfere with the order passed by the learned Collector (Appeals) in that regard.
6. Insofar as pilene ultra is concerned we find that the appellants had produced the certificate from the manufacturer that pilene ultra is the trade name for polyethylene. We also observe from the declaration filed under Rule 57G that polyethylene has been declared as input. In this view of the matter we hold that pilene ultra is nothing but polyethylene for which proper declaration has been made and therefore Modvat credit shall be admissible on this item as an input.
6A. In the result the impugned order is modified to the extent stated above and the appeal is disposed of accordingly.
7. Insofar as penalty is concerned we find that Modvat credit on the item described as plastic powder has already been reversed by the appellants and other items have been found eligible to Modvat. In these circumstances we set aside the order of imposition of penalty also.