1995 (12) TMI 152 - AT - Central Excise

Summary

Issues:
1. Interpretation of Notifications 22/87 and 45/89-C.E. (N.T.) regarding Money Credit facility under Rule 57K of Central Excise Rules, 1944.
2. Validity of original declaration filed under Notification 27/87 in relation to subsequent Notification 45/89.
3. Requirement of fresh declaration under new Notification after rescission of earlier Notification.
4. Compliance with Rule 57-O for availing Money Credit.
5. Applicability of Tribunal decisions in similar cases.
6. Procedural requirements for availing Money Credit under Notifications.
7. Transitional provisions for availing Money Credit on inputs received before filing declaration.

Analysis:
The case involved the appellants manufacturing Vegetable Products using raw materials covered by Notifications 22/87 and 45/89-C.E. (N.T.) for Money Credit under Rule 57K. The dispute arose when the appellants availed credit before filing a fresh declaration under the new Notification, leading to the Collector disallowing the credit. The main contention was whether the original declaration under the earlier Notification remained valid for the subsequent Notification. The appellants argued that their original declaration should suffice, citing Tribunal decisions in similar cases. However, the Departmental Representative argued that a fresh declaration was necessary after the rescission of the earlier Notification.

The Tribunal considered the submissions and reviewed the case law, particularly the Rajasthan Vanaspati Products Limited case. It was noted that the appellants failed to file a declaration under Rule 57-O for the new Notification and did not submit a classification list before receiving the specified inputs. The Tribunal emphasized the procedural requirements under Rule 57S and cited precedents highlighting the importance of filing a declaration as a condition precedent for availing Money Credit. Additionally, the Tribunal referred to the Gujarat High Court decision emphasizing the need for timely credit taking and the department's ability to verify claims.

Regarding the validity of the original declaration, the Tribunal held that the earlier declaration could be relevant for the new Notification under Rule 57-O, as the delay in filing the new declaration was minimal, and the period of wrong credit taking was short. The Tribunal interpreted Rule 57-O to allow credit on inputs after obtaining acknowledgment, without restricting it to inputs received post-acknowledgment. While noting the absence of transitional provisions, the Tribunal emphasized compliance with procedural safeguards under the Notifications for availing Money Credit.

In conclusion, the Tribunal set aside the Collector's order and allowed the appeal, subject to the condition that the appellants demonstrate compliance with the procedural requirements and safeguards under Notification 45/89. The decision highlighted the importance of timely filing of declarations and adherence to procedural norms for availing Money Credit under the Central Excise Rules.