2001 (11) TMI 692 - AT - Central Excise

Summary

Issues:
Appeal against Order-in-Appeal confirming disallowance of Modvat credit and penalty imposition by Deputy Commissioner.

Analysis:
The appeal was filed against the Order-in-Appeal confirming the disallowance of Modvat credit and imposition of penalty by the Deputy Commissioner. The appellants were involved in manufacturing picture tube and Monitor tube. The dispute arose regarding the lapse of Modvat credit as per Rule 57F(17)(b) of the Central Excise Rules. The appellants claimed that they had informed the authorities about the actual amount of Modvat credit on inputs, but the Deputy Commissioner disallowed a specific amount and imposed penalties. The Commissioner (Appeals) upheld the Deputy Commissioner's decision.

The counsel argued that the proviso to Rule 57F(17)(a) and clause (b) were not considered while rejecting the Modvat claim. He presented details of inputs used in finished goods and argued for verification and allowance of Modvat credit. The SDR supported the impugned order's correctness. The Tribunal noted that the impugned order did not consider the proviso to Rule 57F(17)(b) and the Trade Notice No. 76/97 issued by the Jaipur Commissionerate. This omission led to a miscarriage of justice, rendering the order illegal.

The Tribunal found that the Commissioner (Appeals) failed to consider crucial provisions and instructions, necessitating a reconsideration of the Modvat claim. The details provided by the counsel required verification by the adjudicating authority. Consequently, the impugned order was set aside, and the matter was remanded to the adjudicating authority for a fresh decision after considering the observations and hearing the appellants.