2005 (1) TMI 467 - AT - Central Excise

Summary

Issues:
Availability of Modvat credit on duty paid for HSD Oil from July 1997 to October 1997.

Analysis:

Issue 1: Availability of Modvat credit on duty paid for HSD Oil

The appeal filed by M/s. Banswara Syntex Ltd. raised the question of whether Modvat credit for duty paid on HSD Oil was accessible to them during the period from July 1997 to October 1997. The appellant's representative argued that HSD Oil was utilized as fuel for electricity generation, which was further used in manufacturing the final product within the production facility. Reference was made to a Supreme Court case where it was held that the assessee was entitled to benefit from a notification until Rule 57B of the Central Excise Rules, 1944 was amended, and the Revenue's appeal was dismissed. On the contrary, the Respondent's representative highlighted Section 112 of the Finance Act, 2000, which explicitly stated that no credit of duty paid on HSD Oil would be admissible during the specified period. The Respondent also cited a decision by the Rajasthan High Court supporting the validity of Section 112. The Tribunal noted that the Modvat credit claimed by the appellants fell within the period specified in Section 112, which validated the denial of credit for duty paid on HSD Oil during the relevant timeframe. The Tribunal observed that the earlier Supreme Court decision did not consider the provisions of Section 112. Consequently, the Tribunal rejected the appeal, citing that the decision in question was per incuriam the provisions of Section 112, which upheld the denial of credit for duty paid on HSD Oil during the specified period.

This detailed analysis of the legal judgment from the Appellate Tribunal CESTAT, New Delhi, provides a comprehensive overview of the issues involved, the arguments presented by both parties, and the Tribunal's decision based on the relevant legal provisions and precedents cited during the proceedings.