1998 (5) TMI 197 - AT - Central Excise

Summary

Issues:
1. Entitlement to benefit of Notification No. 208/83 for the period 1-8-1983 to 31-12-1986.
2. Eligibility to the notification in the appellant's case prior to the period 1-3-1986.
3. Benefit of Modvat credit on waste and scrap of iron and steel.
4. Question of limitation regarding the benefit of Notification No. 208/83.

Analysis:

Issue 1: Entitlement to benefit of Notification No. 208/83 (1-8-1983 to 31-12-1986)
The appellants, dealing with purchase duty paid ship breaking scrap, were denied the benefit of Notification No. 208/83 by the adjudicating authority. The denial was based on the contention that the raw material obtained from breaking ships did not fall under the said notification. The Tribunal held that as long as the description of the goods tallied with the inputs obtained by the appellants, the benefit of the notification could not be denied. However, waste and scrap falling under a specific heading were not entitled to the benefit, but the appellants could claim Modvat credit on duty-paid inputs.

Issue 2: Eligibility to the notification before 1-3-1986
The adjudicating authority had not considered the appellant's eligibility to the notification before 1-3-1986. The Tribunal noted that the authority had denied the benefit solely based on specific sub-headings without assessing the eligibility before the mentioned period. The appellant's entitlement to the notification was confirmed by referring to previous Tribunal judgments.

Issue 3: Benefit of Modvat credit on waste and scrap of iron and steel
The appellant claimed entitlement to Modvat credit on waste and scrap of iron and steel falling under a specific heading. The Tribunal acknowledged the duty-paid nature of the inputs and allowed the benefit of Modvat credit, emphasizing that this aspect needed further adjudication by the lower authorities due to the lack of previous assertion by the appellant.

Issue 4: Question of limitation regarding the benefit of Notification No. 208/83
The appellant argued that their omission to declare did not warrant invoking a longer limitation period for claiming the benefit of Notification No. 208/83. The Tribunal agreed, citing a precedent that mere omission without a positive act does not justify a longer limitation period. Consequently, the Tribunal partially allowed the appeal, remanding part of the matter to the adjudicating authority for further assessment, and set aside penalties and confiscation.

In conclusion, the Tribunal ruled in favor of the appellant regarding the benefit of Notification No. 208/83, Modvat credit entitlement, and limitation period, setting aside penalties and confiscation based on the facts and circumstances of the case.