2001 (11) TMI 691 - AT - Central Excise

Modvat/Cenvat - Modvat on capital goods - Duty paying documents - Adjudication - Natural justice

Summary

Issues:
1. Disallowance of Modvat credit on capital goods purchased from an unregistered dealer.
2. Application of Notification No. 64/94-C.E. (N.T.) to Modvat credit on capital goods.
3. Violation of principles of natural justice regarding adjournment request.

Analysis:
1. The appellants had taken Modvat credit on capital goods purchased from an unregistered dealer. The department proposed to disallow the credit as the invoice was issued after a specified date. The Assistant Commissioner relaxed the registration condition due to subsequent registration of the dealer, dropping the proceedings. The Commissioner (Appeals) allowed the department's appeal, stating Notification No. 64/94-C.E. (N.T.) did not apply to capital goods credit, leading to the current appeal.

2. The appellant argued the violation of natural justice due to the Commissioner (Appeals) not considering their adjournment request. Regarding the merits, the appellant contended that Notification No. 64/94-C.E. (N.T.) applied to both inputs and capital goods credit. However, the department argued that the notification only amended provisions related to inputs credit and not capital goods credit, making it inapplicable to the case.

3. The judge found no evidence of the Commissioner (Appeals) receiving the adjournment request and upheld the decision based on merit. It was determined that Notification No. 64/94-C.E. (N.T.) did not apply to capital goods credit, as it was specifically for amending provisions related to inputs credit. The lower appellate authority's decision was supported, and the appeal was rejected based on these grounds.