2000 (3) TMI 421 - AT - Central Excise

Summary

Issues:
1. Utilization of Modvat credit on capital goods.
2. Admissibility of capital goods under Rule 57Q.
3. Jurisdictional limits of the Assistant Commissioner.
4. Appeal against the Commissioner (Appeals) order.

Utilization of Modvat credit on capital goods:
The case involved a show cause notice issued to a company regarding the utilization of Modvat credit on capital goods acquired by them. The notice listed disputed goods in different annexures, with specific allegations related to the admissibility of certain capital goods under Rule 57Q of the Rules. The Assistant Commissioner passed orders after hearing the company, where he examined the declarations filed by the company for the goods mentioned in the notice. He considered the declarations, purchase orders, and invoices to determine the admissibility of the goods. The Assistant Commissioner found that most of the contested goods did not fall under the category specified in Rule 57Q.

Admissibility of capital goods under Rule 57Q:
The company appealed to the Commissioner (Appeals) challenging the Assistant Commissioner's decision on the grounds that he exceeded his jurisdiction by examining the eligibility of goods listed in one of the annexures. The Commissioner (Appeals) did not address this specific submission in his order and instead remanded the proceedings for further consideration. The company then sought a stay on the order concerning the goods in question. Upon hearing both parties, the Tribunal decided to take up the main appeal for disposal, considering the issue capable of determination. The Tribunal noted that the Assistant Commissioner had overstepped his jurisdiction by examining the eligibility of goods not specifically mentioned in the show cause notice.

Jurisdictional limits of the Assistant Commissioner:
The Tribunal referenced previous judgments to support its decision that the Assistant Commissioner had acted beyond his authority by assessing the eligibility of goods not subject to the initial notice. Citing cases such as Scientific Compounds & Processes Pvt. Ltd. v. CCE Bangalore and Godrej Soaps Ltd. v. Commissioner of Central Excise, Mumbai II, the Tribunal ruled that decisions made beyond the scope of the allegations were unsustainable. Consequently, the Tribunal allowed the appeal, modifying the Commissioner's order to prevent the Assistant Commissioner from examining the eligibility of goods listed in the specific annexure and instructed immediate relief to be granted.

Appeal against the Commissioner (Appeals) order:
The Tribunal's decision also addressed the stay application, disposing of it along with the main appeal. By clarifying the limits of the Assistant Commissioner's jurisdiction and emphasizing the importance of adhering to the scope of allegations in such cases, the Tribunal provided a comprehensive resolution to the issues raised in the appeal.