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1996 (10) TMI 312 - AT - Central Excise
Issues:
- Eligibility for Modvat credit on inputs used in the manufacture of final product. - Interpretation of declaration under Rule 57G. - Corroboration of goods received with declaration. - Application of Tribunal's decision in Paro Food Products case. Analysis: The appeal before the Appellate Tribunal CEGAT, Mumbai involved a dispute regarding the eligibility for Modvat credit on inputs used by the Respondent in the manufacture of their final product. The Commissioner of Central Excise, Bombay-III filed the appeal against the Order passed by the Commissioner of Central Excise (Appeals), Bombay, rejecting a review application under Section 35E of the Central Excises and Salt Act, 1944. The dispute arose when the Department found that the inputs declared as 'angles' by the Respondent were described as Black Steel Scrap on certain gate passes. The amount of duty credit involved was Rs. 24,306, and a Show Cause Notice was issued by the Jurisdictional Superintendent of Central Excise. The Assistant Commissioner concluded that the goods received were indeed 'angles' as per the Respondent's declaration, based on various documents like sale orders, delivery challans, and invoices. The Commissioner (Appeals) also upheld this decision, leading to the appeal before the Tribunal. In the Tribunal, the ld. JDR for the appellant Commissioner argued that the goods received as input were black steel scrap, which was not declared by the Respondent. He relied on a previous decision of the Tribunal in the case of Paro Food Products, where Modvat credit was disallowed for metal containers not included in the declaration. However, the Respondent did not appear for the hearing. Upon careful consideration of the submissions, the Tribunal analyzed whether the goods received by the Respondent matched their declaration. The Assistant Collector's conclusion was supported by evidence such as sale orders, delivery challans, and a manufacturer's certificate confirming the nature of the goods. The Tribunal emphasized that the issue primarily revolved around the classification of the goods and noted that any inaccuracies in classification should be rectified by the supplier under Rule 57E. As long as it was established through corroborative evidence that the Respondent had received 'angles,' which were used in their final product, Modvat credit had to be allowed. The Tribunal distinguished the facts of the Paro Food Products case, finding them not directly comparable to the present case. Consequently, the Tribunal upheld the Commissioner (Appeals)'s order, rejecting the appeal. In conclusion, the Tribunal affirmed the decision that the Respondent was entitled to Modvat credit on the inputs used in the manufacture of their final product, as the goods received aligned with their declaration and were supported by corroborative evidence. The Tribunal dismissed the appeal, emphasizing the importance of accurate classification and documentation in claiming Modvat credit.
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