Court No. - 37 Case :- CENTRAL EXCISE REFERENCE APPLICATION No. - 68 of 2000 Petitioner :- M/S Qamar Steel Tubes (P) Ltd. Respondent :- The Customs, Excise & Cold (Control) & Others Petitioner Counsel :- S.S. Chopra Respondent Counsel :- S.S.C. Hon'ble Rajes Kumar,J.
Hon’ble Subhash Chandra Nigam,J.
This is a reference application under Section 35H (1) of the Central Excise
Act, 1944.
Several questions have been raised but during the course of the argument, Sri
A.P.Mathur, learned counsel for the applicant states that questions may be
reformulated and he suggested that only question arises namely, whether the
Tribunal is justified in disallowing the claim of Modvat Credit, even, though,
it has not been disputed that input had been received and duty had been
paid ?.
The brief facts of the case are that the applicant claimed the Modvat Credit on
the basis of original copies of invoices under Rules 57-G of the Central Excise
Rules (hereinafter referred to as ‘ the Rules’ ). The said Modvat Credit has
been disallowed on the ground that under Rule 52A and 57G (2A) of the
Rules, the Modvat Credit could be claimed on the basis of the duplicate copy
of invoice and not on the basis of the original invoice and therefore, the claim
of Modvat Credit was in violation of Rule 52A and Rule 57G of the Rules.
Asstt. Commissioner has further held that the applicant has wrongly availed
the benefit of Rule 57G (2A) of the Rules and despite sufficient time was
given to the assessee to produce duty paying documents but the same was not
produced.
Being aggrieved by the said order, the applicant filed an appeal which has
been dismissed by the Commissioner (Appeal) Custom & Central Excise,
Ghaziabad vide order dated 3.7.98. Against the said order, the applicant
preferred second appeal before the Tribunal which has also been dismissed by
the impugned order dated 7.7.2000.
Before the Tribunal, the applicant contended that the duplicate copy
(transporter’s copy) of the invoice has been lost in transit and the matter may
be remanded back to the Asstt. Commissioner for the consideration of
aforesaid explanation. The Tribunal has refused to entertain the plea taken by
the applicant on the ground that no such plea has been taken by the assessee
before the Asstt. Commissioner.
We have heard Sri A.P. Mathur, learned counsel for the applicant and learned
Standing Counsel for the department.
Rule 52A and Rule 57G and Sub-Rule (2A) of the Act read as follows:-
52A. Goods to be delivered on an invoice-(1) No excisable goods shall be delivered from a
factory or a warehouse except under an invoice signed by the owner of the factory, or his
authorised agent:
Provided that when the excisable goods, other than those to which the provisions of Chapter
VII-A apply, are removed on payment of duty such invoice shall be required to be
countersigned by the proper officer.
Explanation- In this rule, and in any other rule, where the term invoice or gate-pas, as the
case may be, is used it shall mean-
(i) assesee’s own document such as invoice, challans, advice or other document of similar
nature generally used for the sale or removal of excisable goods and which shall contain all
the particulars as required under the said Act or in these rules’ or
(ii) such other form as the Central Board of Excise and Customs may notify.
(2) The invoice shall be made out in quadruplicate { The original copy shall be for the buyer
, the duplicate for the transporter, and the triplicate shall retained by the manufacturer.} The
manufacturer may make extra copies of the invoice for his own use and each such extra
copy shall be clearly marked with its sequential number. The duplicate copy shall be
produced by the transporter on demand by any officer while the goods are en route to such
destination from the factory:
Provided that in respect of removal of excisable goods consumed within the factory for
manufacturer of other goods in a continuous process, the manufacturer may make out a
single invoice, at the end of the day:
Provided further that the any excisable goods, other than those to which the provisions of
Chapter VII-A apply, the invoice shall be presented to the proper officer for counter-
signature at least one hour before the actual removal of goods from the factory. After
counter-signature the proper officer shall return all the copies of the invoice to the
manufacturer except the triplicate required for his record.
{ (3) The copies of the invoices shall be marked at the top in bold capital letters in the
following manner, namely:-
(i) the original copy shall be marked as ORIGINAL FOR BUYER;
(ii) the duplicate copy shall be marked as DUPLICATE FOR TRANSPORTER ( to be used
for taking credit under Rule 57G and Rule 57T);
(iii) the triplicate copy shall be marked as TRIPLICATE FOR ASSESSEE.}
Rule 57G- Procedure to be observed by the manufacturer._(1) Every manufacturer
intending to take credit of the duty paid on inputs under Rule 57A, shall file a declaration
with the Assistant Collector of Central Excise having jurisdiction over his factory, indicating
the description of the final products manufactured in his factory and the inputs intended to
be used in each of the said final products and such other information as the said Assistant
Collector may require, and obtain a dated acknowledgement of the said declaration.
(2)A manufacturer who has filed a declaration under sub-rule (1) may, after obtaining the
acknowledgement aforesaid, take credit of the duty paid on the inputs received by him;
{Provided that no credit shall be taken unless the inputs are received in the factory under the
cover of a Gate Pass, an AR-1, a Bill of Entry or any other document as may be prescribed
by the Central Board of Excise and Customs (constituted under the Central Board of
Revenue Act, 1963 (54 of 1963) in this behalf evidencing the payment of duty on such
input};
Provided further that having regard to the period that has elapsed since the duty of excise
was imposed on any inputs, the position of demand and supply of the said inputs in the
country and any other relevant considerations, the Central Government may direct that with
effect from a specified date, all stocks of the said inputs in the country, except such stocks
lying in a factory customs area { as defined in the Customs Act, 1962 (52 of 1962)} or a
warehouse as are clearly recognisable as being non-duty paid may be deemed to be duty-
paid and credit of duty in respect of the said inputs may be allowed at such rate and subject
to such conditions as the Central Government may direct, without production of documents
evidencing the payment of duty;
Provided also that the manufacturer shall take all reasonable steps to ensure that the inputs
acquired by him are goods on which the appropriate duty as indicated in the documents
accompanying the goods has been paid.
(2A) Notwithstanding anything contained in sub-rule (2), a manufacturer can take credit of
inputs received in the factory on the basis of the original invoice, if the duplicate copy of
invoice has been lost in transit, subject to the satisfaction of the Assistant Collector}.
(3)……………
(a)……………
(b)…………..
{(4) A manufacturer of the final products shall submit to the Superintendent of Central
Excise the original documents evidencing the payment of duty along with extracts of Parts I
and II of Form RG-23A every month and the Superintendent of Central Excise shall, after
verifying their genuineness, deface such documents and return the same to the
manufacturer}.
{(5) Where a manufacturer was not in a position to make a declaration under sub-rule (1)
and makes the declaration subsequently, the Assistant Collector may, for reasons to be
recorded in writing, condone the delay in filing of such declaration and allow the
manufacturer to take credit of the duty already paid on the inputs even though the procedural
requirements laid down under this rule have not been complied with;
Provided that such permission may be granted by the Assistant Collector only when he is
satisfied that the-
(a) inputs in respect of which credit of duty is to be allowed were received in the factory not
before a period of six months from the date of filing such declaration and not before the date
of notification issued under Rule 57A;
(b) amount of duty for which credit is sought have actually been paid on such inputs; and
(c) inputs have actually been used or are to be used in the manufacturer of final products}.
Admittedly, the applicant has claimed the Modvat Credit on the basis of the
original copy of invoice and not on the basis of the duplicate copy
(transporter’s copy). Before the Asstt. Commissioner, no such plea has been
raised by the applicant that the duplicate copy (transporter’s copy) has been
lost in transit and as such the benefit of Rule 57G(2A) has not been availed.
The Asstt. Commissioner has also recorded the finding that sufficient time
was given to the assessee to produce duty paying documents but the same was
not done. Therefore, the Authorities have rightly held that the Modvat Credit
was allowed in violation of Rule 52A and 57G of the Act. Since no plea has
been taken by the applicant before the Asstt. Commissioner that the duplicate
copy (transporter’s copy) has been lost in transit, hence, the Tribunal has
rightly held that such plea could not be considered at this stage.
We do not see any error in the view taken by the Tribunal in refusing to
entertain such plea. In such circumstances, we do not see that any substantial
question of law which is sought to be considered by this Court arises from the
order of the Tribunal.
The reference is, accordingly, dismissed.
Order Date :- 7.1.2010
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