2005 (3) TMI 648 - AT - Central Excise

Summary

Issues:
1. Confirmation of duty on DG Set cleared without payment.
2. Claim for depreciation on the DG Set.
3. Reversal of Modvat credit.
4. Remand to Original Authority for re-calculation.

The appeal addressed the confirmation of duty on a DG Set cleared without payment, which was leased to the appellants under a Hire Purchase Scheme and later sold on auction due to default. The appellants contended they were entitled to a deduction of 2.5% on the original value, claiming the duty was confirmed without considering depreciation. The counsel argued that the Modvat credit to be reversed should be Rs. 82,044 based on the depreciated value, with a sum already credited by the appellants. The duty amount of Rs. 1,32,727 was challenged as incorrect due to the lack of correct depreciation calculation.

After hearing both sides, the Tribunal acknowledged the appellant's claim for depreciation on the auctioned DG Set as legally justifiable. Consequently, the matter was remanded to the Original Authority to verify the appellants' calculation of depreciation value and to rework the total duty, penalty, and interest accordingly. The appellants were granted the opportunity to substantiate their claim during the adjudication proceedings. The Tribunal emphasized that the amount already reversed by the appellants should be considered while confirming the revised amounts.

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