1990 (7) TMI 257 - AT - Central Excise

Summary

Issues:
1. Deemed Modvat credit claim for steel bars under Rule 57H of Central Excise Rules, 1944.
2. Interpretation of Rule 57H regarding the period for availing deemed credit.
3. Application of Modvat scheme to inputs received before filing a declaration.
4. Applicability of the ruling in 'Soft Beverages Pvt. Ltd.' case to the present appeal.

Analysis:
1. The appeal challenged the Collector of Central Excise (Appeals), Madras' order rejecting the appellant's claim for deemed Modvat credit for steel bars in stock as of 5-10-1987 under Rule 57H. The lower authority limited the credit to one month before the declaration acknowledgment.

2. The appellant argued that since the goods were purchased from the open market, deemed credit should be available under Rule 57E proviso, citing the 'Soft Beverages Pvt. Ltd.' case. The lower authority's reasoning on the credit period was deemed untenable by the appellant.

3. The lower appellate authority found that the inputs were received between 24-6-1986 to 5-10-1987 and were in stock after Govt. of India's orders for deemed credit. The authority noted that Rule 57H allowed credit for inputs received before the dated acknowledgment of the declaration, with a one-month period considered 'immediately before.'

4. Referring to the 'Soft Beverages Pvt. Ltd.' case, the Tribunal emphasized the importance of evidence of duty payment and filing the declaration for Modvat scheme benefits. The Tribunal held that the lower authority's restriction to one month for availing credit was legally unsustainable, overturning the impugned order and allowing the appeal based on the ruling's interpretation of 'immediately before.'