1999 (11) TMI 235 - AT - Central Excise

Summary

Issues:
Interpretation of Rule 57H regarding the filing of declaration for Modvat credit with the jurisdictional authority.

Analysis:
The appellant argued that the denial of Modvat credit by the Commissioner (Appeals) was based on the ground that the declaration was filed with the Superintendent instead of the Asstt. Commissioner as required by Rule 57H. The Department contended that failure to file the declaration with the Asstt. Commissioner disentitles the manufacturer from taking credit under the rule. The appellant cited previous Tribunal decisions and a Board's Circular to support their argument that filing the declaration with the Superintendent should be considered valid, as it would eventually reach the Asstt. Commissioner. The Department emphasized the need for the declaration to be filed directly with the Asstt. Commissioner for proper verification and issuance of directions.

The appellant relied on Tribunal decisions where declarations filed with the Superintendent were considered valid for Modvat credit purposes. The Department, however, highlighted the importance of directly addressing the declaration to the Asstt. Commissioner for proper processing and verification. The Tribunal noted the arguments of both sides and acknowledged the procedural lapse in filing the declaration with the Superintendent instead of the Asstt. Commissioner. The Tribunal found merit in the appellant's argument that this procedural error should not be a reason to deny Modvat credit if other conditions are met.

The Tribunal granted an unconditional stay on the recovery of duty demand and the penalty imposed on the appellants until the appeal is decided on its merits. The case was scheduled for regular hearing in due course, allowing for a comprehensive review of the issues raised regarding the interpretation and application of Rule 57H in relation to Modvat credit eligibility.