2014 (8) TMI 327 - AT - Central Excise

Benefit of modvat credit - Tribunal has remanded the matter back to the adjudicating authority with a direction to re-quantify the duty for a period of six months after allowing the benefit of modvat credit - Held that - The fact that show-cause notice has been issued on 09.07.1998 can be verified from the first page and the last page of the show-cause notice itself. Therefore, it is very strange and also not understandable how the Revenue has come to the conclusion that the show-cause has been issued on 19.06.1998. Therefore, the ground taken by the Revenue to file the appeal is totally frivolous and on this ground itself the demand is not sustainable. I further find that in the remand proceedings, there was a clear-cut direction to the adjudicating authority to re-quantify the duty for a period of six months prior to the date of show-cause notice after allowing the benefit of modvat credit. The Tribunal s order has been accepted by the Revenue as no appeal has been filed by the Revenue against the said order. Therefore, the question of demanding differential duty for which the respondent has not shown any proof, is not sustainable because the issue has become final in the earlier round of litigation, hence the appeal filed by the Revenue has no merit - Decided against Revenue.

Summary

Issues:
1. Date of issuance of show-cause notice for duty quantification.
2. Consideration of evidence of export in duty quantification.
3. Validity of Revenue's appeal against the duty quantification.

Analysis:
1. The Tribunal had previously directed the adjudicating authority to re-quantify duty for a specific period after allowing modvat credit based on documentary evidence. The Commissioner considered the demands from 09.01.1998 to 09.07.1998, post the Tribunal's order. However, the Revenue claimed the show-cause notice was issued on 19.06.1998, contrary to the actual date of 09.07.1998. The Tribunal found this discrepancy crucial, dismissing the appeal on this ground as the demand was not sustainable due to the incorrect date claim.

2. The Revenue argued that the respondent failed to provide proof of export, leading to a claim for payment of differential duty. However, the Tribunal noted that the previous order had not imposed such a requirement, and the Revenue had not appealed against it. As the issue had been finalized in the earlier litigation, the Tribunal deemed the demand for differential duty baseless, upholding the respondent's position and dismissing the Revenue's appeal.

3. The Tribunal ultimately upheld the impugned order, finding no merit in the Revenue's appeal. The Tribunal emphasized that the Revenue's grounds for appeal were frivolous and unsustainable, given the clear directions from the previous order and the lack of new evidence or legal basis to challenge the duty quantification. Consequently, the appeal filed by the Revenue was dismissed, affirming the decision in favor of the respondent.