2003 (4) TMI 381 - AT - Central Excise

Summary

Issues: Interpretation of "specified duty" under Notification No. 5/94-C.E. (N.T.) as amended

In this case, the appellants, as manufacturers of R.M. Paints, procured synthetic resins from M/s. Berger Paints, who had imported the resins and cleared them by paying CVD. The appellants took Modvat credit of 95% from M/s. Berger Paints and later took the differential 5% credit as well. The dispute arose when the department resisted this action, citing a circular that limited the credit to 95% only. The original authority and the Commissioner (Appeals) upheld the department's stand, leading to this appeal before the Tribunal.

The main issue revolves around the interpretation of the term "specified duty" under Notification No. 5/94-C.E. (N.T.) as amended. The appellants argued that the specified duty was the CVD paid on the input, entitling them to take the entire credit. On the other hand, the department contended that 95% of the specified duty should also be considered as "specified duty," limiting the appellants' credit to 95% of the CVD paid. The Tribunal noted that neither the original authority nor the Commissioner (Appeals) properly analyzed the terms of the notification, leading to an incorrect decision. The Tribunal set aside the impugned order and remanded the case for a fresh decision after a proper consideration of the submissions with reference to the notifications.