1996 (10) TMI 327 - AT - Central Excise

Summary

Issues:
1. Contravention of Rule 9(1) of Central Excise Rules, 1944 for clearing goods at Nil rate of duty.
2. Dispute over classification of inputs as bars or flats.
3. Benefit of exemption under Notification No. 206/83.
4. Applicability of deemed credit on inputs used for manufacturing excisable goods.
5. Failure to produce duty paying documents like GP 1s.

Analysis:
1. The appeal was filed against contravention of Rule 9(1) of Central Excise Rules, 1944 for clearing M.S. Tie bars at Nil rate of duty instead of the prescribed rate. A show cause notice was issued for recovery of duty, which was confirmed by the Assistant Collector. The matter was remanded to consider Modvat credit based on duty paying documents, but the demand was upheld by the Assistant Collector.

2. The Collector (Appeals) set aside the Assistant Collector's order, stating that the inputs used for manufacturing were bars, entitling the appellant to deemed credit. However, the department argued that the inputs were M.S. Flats, not bars, and the appellate authority erred in setting aside the demand confirmation.

3. The Commissioner held that the appellant was not entitled to exemption under Notification No. 206/83 as the inputs were classified as flats, not bars. The decision was based on a Tribunal case and the classification list approved by the Assistant Commissioner, supporting the department's contention.

4. The issue of deemed credit on inputs was raised, with the department arguing that the appellant failed to produce duty paying documents despite opportunities provided. The department maintained that the inputs were flats, not bars, and the demand confirmation was justified.

5. The failure to produce duty paying documents like GP 1s was highlighted as a crucial point in the case. The appellant's plea that the inputs were bars and entitled to claim credit was rejected due to the clear description of the inputs as M.S. Flats. The Commissioner dismissed the appeal, upholding the department's position on the classification of inputs and the denial of exemption under Notification No. 206/83.