2000 (4) TMI 68 - AT - Central Excise

Summary

Issues involved:
1. Alleged infringement of law regarding availment of Modvat credit on melting scrap.
2. Allegation of diversion of imported melting scrap on loan basis to other manufacturers.
3. Duty demand on quantities not received in the factory premises.
4. Allegation of diversion of scrap without evidence.

Issue 1: The judgment deals with the alleged infringement of law regarding the availment of Modvat credit on melting scrap. The Department alleged four counts of infringement, including discrepancies in recording quantities, diversion of scrap to other manufacturers without return, duty demand on unreceived quantities, and diversion of scrap with Modvat credit. The advocate for the appellants argued that discrepancies in recording quantities should not result in denying Modvat credit. The advocate proposed a reconciliation chart to consider all quantities covered by Bills of Entry against entries in the Scrap Inward Register. The advocate conceded shortages due to short landing, transit loss, and intercarting shortage, offering to pay duty on the differential amount. The Tribunal decided to remand the matter for a de novo consideration based on the reconciliation chart and other evidence.

Issue 2: Regarding the allegation of diversion of imported melting scrap on loan basis to other manufacturers, the advocate admitted the inability to provide documentary evidence due to the seizure of Bills of Entry by the Customs authorities. The Tribunal noted the lack of evidence and non-speaking order on this count, leading to the decision to remand the matter for a fresh consideration with the necessary evidence.

Issue 3: The judgment addressed the duty demand on quantities not received in the factory premises. The advocate indicated the appellants' willingness to remit the duty involved in such cases. The Tribunal acknowledged this willingness and decided to remand the matter to calculate the payable amounts after a careful assessment.

Issue 4: The allegation of diversion of scrap without evidence was discussed, with the Revenue failing to provide any supporting evidence. The Tribunal concluded that this allegation needed to be re-examined in the de novo proceedings along with the other counts. The judgment set aside the original order and remanded the matter to the original authority for a comprehensive re-consideration. The appeals were allowed by way of remand, emphasizing the need for a holistic finding based on correct assessments.