1997 (6) TMI 159 - AT - Central Excise

Summary

Issues:
Prayer for dispensation of pre-deposit of Rs. 85,910.96 due to Modvat credit taken without a valid document.

Analysis:
The appellant sought dispensation of a pre-deposit of Rs. 85,910.96, contending that Modvat credit was taken for goods not covered by a valid document. The appellant argued that the goods were originally imported by a different entity but sold to them on high seas basis. The Bill of Entry indicated the importers' name as the original entity, but the goods were received by the appellants at their factory under the same Bill of Entry. The appellant claimed ownership of the goods due to the high seas sale and their involvement in the clearance process. The appellant asserted that no further endorsement or certificate was necessary for Modvat credit under Rule 57G. The Tribunal noted that the appellants' name was on the Bill of Entry, they received the goods, and were involved in the clearance process, concluding that the Bill of Entry could be considered valid for Modvat purposes without additional requirements.

The department argued that the appellants should have been authorized for importation, and the Bill of Entry should have been endorsed in their name by the original importers. They contended that the original importers remained the relevant parties for Customs Act proceedings, and the mention of "on account" in the Bill of Entry did not alter this. However, the Tribunal found that the appellants' details were on the Bill of Entry, they received the goods, and were responsible for clearance, establishing their ownership and eligibility for Modvat credit. The Tribunal held that no further endorsement or certificate was needed, as the appellants' involvement in the importation and clearance process sufficed to consider the Bill of Entry valid for Modvat purposes under Rule 57G.

In conclusion, the Tribunal, after considering both parties' arguments, observed that the matter was straightforward. With mutual consent to waive the pre-deposit, the appeal was taken up for disposal. The Tribunal found that the appellants' appeal should be allowed based on their ownership of the goods through high seas sale, their receipt of the goods, and their involvement in the clearance process, determining that the Bill of Entry could serve as a valid document for Modvat purposes under Rule 57G. Consequently, the appeal was allowed, and the order was passed in favor of the appellants.