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2015 (12) TMI 737 - HC - Central ExciseReversal of MODVAT Credit - input credit on felts and wires for the period from 29.07.1987 to 09.07.1992. - Held that - For the period 29.07.1987 to 09.07.1992 the appellant did claim MODVAT credit treating the felts and wires as inputs. But the same was denied on the interpretation of the Rule at that point of time. The decision of denying the input credit came to be challenged by the appellants by resorting to the provisions under the Act and Rules and the denial order came to be affirmed by the Tribunal, which denial became final. The order of the Tribunal, intra parties is binding and there cannot be any two opinions about the same decision. Further the effort made by the appellant seeking rectification of the order of the Tribunal on 22.11.1991 also came to be rejected and in fact the reference which is sought from the said Rectification of Mistake (ROM) order also came to be rejected. In other words, whatever may be the legal position for other manufacturers, so far as the appellant is concerned the decision intra parties is binding and there is no escape from the same. Appellants themselves treated the period from 01.03.1987 onwards as distinct would go to show that the declaration filed on 07.07.1992 is only restricted to their claim for availing MODVAT credit on felts and wires treating them as inputs, especially in the light of the order of the Tribunal in Straw Products Ltd., case (1991 (10) TMI 139 - CEGAT, CALCUTTA ). In other words, the claim of the appellant in the letter dated 07.07.1992 is limited to claim a MODVAT credit from and with effect from 07.07.1992 which came to be denied initially by the authorities and subsequently allowed by the Tribunal setting aside such denial. Thus, making the appellant entitle for the input credit with effect from 07.07.1992. The entire proceedings never dealt with the claim of the appellants for MODVAT credit for the period 29.07.1987 to 09.07.1992. Merely because the dates have been mentioned in the claim petition in the letter dated 07.07.1992 it cannot be presumed that the same was in issue before the authorities and adjudicated upon. - order of the Tribunal does not call for any interference and the same is in order - Decided against the assessee.
Issues Involved:
1. Ignoring previous Appellate Tribunal Order allowing MODVAT credit. 2. Non-appreciation of the dispute period indicated in Form EA.3. 3. Impact of later larger Bench decision on earlier Tribunal orders. 4. Denial of credit on procedural grounds. Issue-wise Detailed Analysis: 1. Ignoring Previous Appellate Tribunal Order Allowing MODVAT Credit: The appellant questioned the Final Order No.1471 dated 06.09.2004 by the Tribunal, which ignored Order No.1945/1996 dated 18.10.96 that allowed MODVAT credit on felts and wires. The appellant argued that since no appeal was preferred against the 1996 order, it should be binding. The court noted that the appellant's claim for MODVAT credit from 1987 to 1992 was initially rejected by the Assistant Commissioner and subsequently by the Commissioner (Appeals) and CEGAT, Madras. The rejection became final with the Tribunal's decision on 22.11.1991. The appellant's reliance on the Eastern Bench's contrasting decision and the Larger Bench's decision in Union Carbide India Ltd. was noted, but the court emphasized that the appellant's specific case had already been adjudicated and finalized against them. 2. Non-appreciation of the Dispute Period Indicated in Form EA.3: The appellant contended that the Tribunal failed to appreciate the period of dispute indicated in Form EA.3, which was from 1987 onwards. The court observed that the declaration filed on 07.07.1992 under Rule 57G was specific to availing MODVAT credit on felts and wires post-1992. The Assistant Commissioner's rejection on 03.06.1994 was later reversed by the Tribunal on 18.10.1996. However, this did not automatically entitle the appellant to credit for the period from 1987 to 1992, as the initial rejection had become final and binding. 3. Impact of Later Larger Bench Decision on Earlier Tribunal Orders: The appellant argued that the Larger Bench decision in Union Carbide India Ltd. should overrule the earlier Tribunal order dated 22.11.1991. The court clarified that the Union Carbide decision established eligibility for MODVAT credit on felts and wires but did not affect the finality of the appellant's case. The denial of credit for the period 1987 to 1992, affirmed by the Tribunal in 1991, was binding and not subject to change by subsequent decisions. 4. Denial of Credit on Procedural Grounds: The appellant claimed that the denial of credit on procedural grounds was incorrect, referencing the Supreme Court's decision in M/s. Formica India Division, which held that benefits should not be denied on technical grounds. The court noted that this question did not arise from the Tribunal's orders and thus did not need consideration. The Tribunal's order was based on the finality of the previous adjudications and the wrongful availment of credit, not merely procedural non-compliance. Conclusion: The court concluded that the appellant's entitlement to MODVAT credit for the period 1987 to 1992 was not established by the subsequent Tribunal order or the Larger Bench decision. The finality of the 1991 Tribunal decision was binding, and the appellant's attempt to claim credit for the earlier period was not supported by the facts or the legal framework. The appeal was dismissed, and the questions of law were answered in favor of the Revenue, affirming the Tribunal's order. Final Judgment: The appeal was dismissed, and the questions of law were answered in favor of the Revenue, with no order as to costs.
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