1999 (10) TMI 260 - AT - Central Excise

Summary

Issues: Modvat credit on imported Radio Pagers

Analysis:
The case involved a dispute regarding the Modvat credit in relation to the additional duty of excise paid on imported Radio Pagers. The Radio Pagers imported were deemed unusable in the country, and the process undertaken by the Respondents was considered a manufacturing process, resulting in the clearance of manufactured Pagers with the benefit of Modvat credit. The Asstt. Commissioner disallowed the Modvat credit, arguing that there was no distinct manufacturing process as both the imported and manufactured Pagers shared the same name in the market. However, the Commissioner of Central Excise (Appeals) overturned this decision, stating that the imported goods were distinct from the final manufactured products, making the Modvat credit admissible.

Upon hearing arguments from both sides, the Appellate Tribunal considered the matter. It was acknowledged that the final products were cleared after paying Central Excise duty, indicating that the process undertaken by the Respondents was deemed manufacturing. While some parts of the imported Radio Pagers were utilized in the manufacturing process, the Appellate Tribunal noted that the Appellant Authority had already ruled that the process amounted to manufacturing. The Tribunal also highlighted that the parts not used were not disposed of in a manner conflicting with Modvat rules.

The Tribunal referenced a similar case and upheld the decision of the Commissioner of Central Excise (Appeals) that Modvat credit was indeed available in such circumstances. Consequently, the Tribunal found no merit in the Revenue's appeal and rejected it, affirming the admissibility of the Modvat credit on the imported Radio Pagers.