2006 (3) TMI 49 - HC - Central Excise

Central Excise Cenvat/Modvat Tribunal dismissed appeal on ground that RG 23 certificate could not have been verified and this issue also not send back to adjudicating authority Matter remanded to adjudicating authority to decide the matter on basis of material record

Summary

Issues:
Petition to quash order passed by CESTAT, Mumbai regarding credit of duties paid on inputs used in manufacturing exempted goods.

Analysis:
The petitioner sought to quash an order passed by CESTAT, Mumbai, related to the credit of duties paid on inputs used in manufacturing exempted goods. The petitioner claimed that they did not avail credit on quantities of fibers used in manufacturing exempted yarns for Regd. Co-operative Societies. The Assistant Collector confirmed a demand of Rs. 6,83,313/- along with a penalty of Rs. 50,000/-. The Commissioner (Appeals) and the Appellate Tribunal upheld the decision. The Tribunal observed that the issue revolved around whether the petitioner availed Modvat credit on raw materials, which could be verified from RG-23 Part-II records. The petitioner argued that they maintained the necessary registers as per Rule 57 G (7) of the Central Excise Rules, and the matter should be remanded for verification.

The respondent, opposing the petition, contended that an alternative remedy was available through a Tax Appeal, citing a Supreme Court decision. They argued against remanding the matter to the adjudicating authority, stating that the documents requested were not produced despite prior opportunities. The Court noted that the Tribunal dismissed the appeal based on the inability to verify the RG 23 certificate, without remanding it. It was decided that proper verification of RG 23A Part I & II registers was necessary to determine if Modvat credit was availed. The Court acknowledged the objection regarding alternative remedies but deemed it appropriate to remand the matter for verification based on the registers.

The Court quashed the Tribunal's order and remanded the issue to the Adjudicating Authority for verification. The respondent authorities were directed to deposit a sum towards costs, and the petition was disposed of accordingly, with no further order as to costs.