2005 (12) TMI 421 - AT - Central Excise

Summary

Issues:
Deemed credit denial due to lack of evidence of duty payment under Notification No. 58/97.

Analysis:
The appeal challenged the Order-in-Appeal stating that deemed credit cannot be availed without proof of duty payment. The appellant purchased goods from a manufacturer under Section 3A and compounded levy scheme under Rule 96ZP, relying on Notification No. 58/97 for deemed credit. The adjudicating authority and Commissioner (Appeals) upheld duty demand and penalty imposition. The appellant argued compliance with Notification No. 58/97, emphasizing no requirement to prove duty payment. The key issue was whether evidence of duty discharge by the manufacturer was necessary.

The Tribunal found that Notification No. 58/97 allowed credit for inputs received directly from a manufacturer under compounded levy scheme, provided the duty was paid. The appellant received goods with invoices endorsing "Duty paid under compounded levy scheme 96ZP." Evidence showed the manufacturer discharged duty via TR-6 challans, and the appellant made payments. Citing Vikas Pipe case, the Tribunal noted no requirement to prove duty payment by the supplier. The High Court's ruling in a similar case supported the appellant's claim under Notification No. 58/97.

The Tribunal set aside the Order-in-Appeal, allowing the appeal based on compliance with Notification No. 58/97 requirements. The judgment emphasized the absence of a duty payment evidence requirement for deemed credit under the notification. The decision highlighted the appellant's fulfillment of conditions specified in the notification, leading to the appeal's success and overturning of the previous orders.