2004 (6) TMI 551 - AT - Central Excise

Summary

Issues: Errors apparent on record in Tribunal's Final Order No. C-I/233-332/WZB/2003 regarding Modvat credit entitlement and penalty imposition.

The judgment addresses the errors apparent on record in Tribunal's Final Order No. C-I/233-332/WZB/2003, specifically concerning the entitlement of Modvat credit for re-rollers of iron and steel and the imposition of fines and penalties. The applicants argued that the Tribunal's order failed to address the issue of penalties imposed by the Additional Commissioner and upheld by the Commissioner (Appeals), contending that these penalties should be set aside based on the decision in the case of Digambar Foundry. The Tribunal acknowledged the mistake in not recording a finding on the sustainability of fines and penalties, noting that in the Digambar Foundry case, penalties were set aside upon resolution of the legal issue. Consequently, the Tribunal set aside the fines and penalties in the present case.

Regarding the second issue raised by the applicants, the Tribunal rejected the argument that Modvat credit could not be denied upon exceeding the clearance value limit of Rs. 75 lakhs, as this ground was not proposed in the show cause notice. The Tribunal explained that the benefit of deemed credit was linked to availing the benefits of Notification 1/93, and any interpretation of the notification would impact the availment of such benefit. Therefore, the contention that the issue was not specifically raised in the show cause notice was deemed without merit. Consequently, the Tribunal partially allowed the Review Applications by setting aside the fines and penalties imposed on the applicants.