2006 (6) TMI 65 - HC - Central Excise

Credit availed on chillers by filing a declaration - Tribunal has recorded a finding that there was mutual mistake on both sides and filing of a wrong declaration cannot be said to be a deliberate suppression and held that the SCN issued by invoking the larger period of limitation cannot be sustained. - finding of fact recorded by the Tribunal cannot be faulted

Summary

Issues:
- Suppression of facts by filing a wrong declaration after a specific notification
- Entitlement to MODVAT credit despite specific provisions in a notification
- Reliance on a decision not relevant to the present case
- Denial of credit on chillers used as capital goods

Analysis:
1. The first issue revolves around whether the filing of a declaration on 7.7.1997, post a specific notification, wrongly declaring the end use of the Chiller Package amounts to suppression. The Tribunal found mutual mistake on both sides and held that the wrong declaration did not constitute deliberate suppression. Consequently, the Tribunal concluded that the show cause notice invoking a larger period of limitation was not sustainable. The High Court upheld this finding, stating it cannot be faulted, thereby dismissing the department's argument.

2. The second issue questions whether the assessee is entitled to MODVAT credit despite the provisions of Notification No. 6/97-EX(NT) dated 1.3.1997. The Tribunal did not delve into this issue as the show cause notice was already time-barred. Therefore, the High Court deemed it unnecessary to consider the alternate submission made by the respondent, ultimately leading to the dismissal of this aspect of the appeal.

3. The third issue pertains to the reliance by the Hon'ble CESTAT on a decision in a different case not directly relevant to the present matter. The High Court did not find any merit in this appeal, given the time-barred nature of the show cause notice and the lack of necessity to address the alternate submissions. Consequently, the appeal was dismissed without imposing any costs.

4. Lastly, the dispute in this appeal involves the denial of credit on chillers utilized as capital goods. The respondent had availed credit by filing a declaration, which was later challenged through a show cause notice. The Tribunal's finding of mutual mistake and absence of deliberate suppression played a crucial role in the resolution of this issue, ultimately leading to the dismissal of the appeal by the High Court.