2003 (10) TMI 551 - AT - Central Excise

Summary

Issues:
Denial of Modvat credit on capital goods due to lack of declaration under Rule 57T.

Analysis:
The appellants were denied Modvat credit on capital goods by the lower appellate authority for not filing a Rule 57T declaration. The appellants received the goods without the declaration but later submitted it with reasons for the delay, which was acknowledged by the Asstt. Commissioner. The Commissioner (Appeals) reversed the decision, disallowing the credit, citing lack of valid reasons for condoning the delay.

The appellant argued that the Asstt. Commissioner had discretion to condone the delay based on reasons provided, and the Commissioner (Appeals) overstepped by substituting his discretion. The Department contended that the Asstt. Commissioner did not justify the delay or the credit, allowing the appellate authority to rectify any flaws in the decision.

The Tribunal noted that the goods were received and used for manufacturing, with no dispute on their duty-paid nature. The denial of Modvat credit was solely due to the delayed declaration. The Commissioner (Appeals) reversed the Asstt. Commissioner's decision without requiring reasons for condonation, which was deemed unwarranted interference. The Tribunal upheld the Asstt. Commissioner's decision, stating that the question of Modvat credit eligibility needed to be assessed on its merits, as the goods were eligible for credit and the delay was condoned properly.

Therefore, the impugned order was set aside, and the appeal was allowed, granting the appellants the entitlement to the Modvat credit on the capital goods.