1997 (10) TMI 231 - AT - Central Excise

Summary

Issues:
The issues involved in this case include the admissibility of credit u/s Rule 57T, jurisdiction of the Commissioner of Central Excise, Pune, and the interpretation of the proviso to sub-rule (3) of Rule 57T.

Admissibility of Credit u/s Rule 57T:
The appellant, a manufacturer of glass and glassware, sent machinery for renovation to another company. The appellant took credit of duty paid u/s Rule 57T, but the Assistant Commissioner issued a notice proposing to recover the credit. The Commissioner disallowed a portion of the credit, leading to the appeal. The appellant argued that the Commissioner at Pune lacked jurisdiction to decide on duty payment at Mumbai and that credit cannot be refused once duty is paid. The Departmental Representative contended that the Commissioner of Central Excise, Pune, had jurisdiction to decide on credit eligibility. The Tribunal found that the notice overlooked the proviso to sub-rule (3) of Rule 57T, which also applies to renovation, not just initial plant setup. The Commissioner's order was set aside on this basis.

Jurisdiction of the Commissioner of Central Excise, Pune:
The Departmental Representative argued that the Commissioner of Central Excise, Pune, had the authority to decide on credit eligibility. However, the Tribunal found that the Commissioner's order exceeded the allegations in the notice, as the proviso to sub-rule (3) of Rule 57T applied to renovation as well. The Tribunal emphasized that the Commissioner of Central Excise, Pune, lacked jurisdiction to set aside duty payment decisions made by the Assistant Commissioner at Mumbai.

Interpretation of the Proviso to Sub-rule (3) of Rule 57T:
The Departmental Representative's argument regarding the proviso to sub-rule (3) of Rule 57T was deemed irrelevant by the Tribunal. The proviso is an exception to the rule that no credit shall be taken without specified documents. The Tribunal clarified that the proviso applies to cases where goods are received by a job worker or contractor, not in the appellant's scenario. The appellant erroneously invoked sub-rule (3) in this context. The Tribunal cited a relevant case to support the appellant's entitlement to credit based on duty paying documents.

In conclusion, the Tribunal allowed the appeal, stating that the credit was rightly taken, and set aside the impugned order.