2005 (4) TMI 444 - AT - Central Excise

Summary

Issues: Rate of deemed credit on goods cleared on job work basis, stock of goods as on a specific date, and goods manufactured and cleared post that date.

In the present case, the main issue revolves around determining the rate at which the appellants are entitled to the deemed credit on various categories of goods. The appellants, engaged in the manufacture of man-made fabrics across multiple mills, faced a challenge regarding the rate of deemed credit under Notification No. 29/96-C.E. (N.T.). The dispute encompassed the rate applicable to goods cleared on job work basis, the stock of goods as on 2-6-98, and the goods manufactured and cleared post that date.

The Tribunal analyzed the facts and arguments presented by both sides. It was established that the appellants operated multiple mills for different manufacturing processes, with specific implications for the deemed credit rates. The Revenue contended that the appellants were entitled to deemed credit at 50% for job work and on an actual basis for goods manufactured and cleared post 2-6-98. Additionally, the Revenue sought to limit the credit on stock as of 2-6-98 to 50%.

Regarding the stock as of 2-6-98, the Tribunal ruled in favor of the appellants, granting them a credit rate of 60% under the relevant notification. This decision aligned with the precedent set by the Tribunal in a similar case involving M/s. Grasim Industries Ltd. On goods cleared on job work basis, the Tribunal determined that the appellants were entitled to a credit rate of 50% based on a thorough examination of the notification's provisions.

For goods manufactured and cleared post 2-6-98, the Tribunal ruled that the appellants were entitled to credit on an actual basis. The competent authority was tasked with quantifying the credit amount accordingly. In cases where excess credit had been availed by the appellants, the Revenue was permitted to recover the surplus amount. Consequently, the impugned orders were modified in line with the Tribunal's decisions, providing the appellants with the necessary relief as per the law.

In conclusion, the Tribunal's comprehensive analysis and subsequent rulings addressed the various issues concerning the rate of deemed credit on different categories of goods, ensuring a fair and legally sound resolution to the appeals brought before it.