9911796707
TMI Blog1991 (8) TMI 218X X X X Extracts X X X X X X X X Extracts X X X X ..... Accordingly, they were availing of this benefit. However, it came to the notice of the Department on a perusal of the RT 12 and RG 23 etc., that they were taking Modvat credit even in respect of the inputs used in the manufacture of bearings, which were removed under Chpt. X procedure under Nil rate of duty equipments cleared to other manufacturers. Hence, the Supdt. issued a notice on 9-4-1987, covering the period from April, 1986 to Oct. 1986, denying Modvat credit in respect of the duty paid on Bi-metal used in the manufacture of bearings, which were cleared under Chpt. X procedure at Nil rate of duty. The Asst. Collector adjudicated upon the show cause notice and the matter went up before the Collector (Appeals). The Collector (Appeals) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , took us through the copies of the show cause notice, issued by the Supdt, the order of the Collector (Appeals) and the corrigendum issued by the Addl. Collector and pleaded that the Addl. Collector's order is without basis of a valid show cause notice. Hence, the entire order is liable to be set aside on this ground. He also contended that even during the period when Rule 57I was not containing the specific provisions of time limit, it is always subject to provisions of Sec. 11A. This is the view, which has been held by the Karnataka High Court in the case of Thungabhadra Steel Products Ltd. reported in 1991 (33) ECC 140 (Kar.). Even in the case decided by the Gujarat High Court, reported in, 1991 (55) E.L.T. 25 (Guj.) - 1990 (30) ECC 142 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt has to be proportionately reduced. The appellants are assessees working under SRP and hence they ought to have done this, since they know that Modvat credit is not admissible, if they have been used in the exempted final product. He also contended that the corrigendum makes a specific mention of suppression of the fact of removal without payment of duty under bond, wherein the inputs have been used and hence that communication, though styled as corrigendum, is to be treated as a valid show cause notice. He also heavily relied on the decision of the Gujarat High Court in the case of Torrent Laboratories (supra), and pleaded that when Rule 57-I did not prescribe any time limit, the notice issued within a reasonable time can be enforced aga ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Collector could have directed the Asst. Collr. to confirm only that part of the demand, which is within the period of six months, giving a finding that this is not a case of suppression justifying the extended period; (ii) If the Administrative Collector is of the view that a suppression has been committed for defrauding the revenue, he would have directed the issue of a fresh show cause notice, especially, when the Supdt. has not made any fresh specific allegation. 7. In this case, the Addl. Collector has only chosen to issue a corrigendum for directing the appellants to show cause to him and in that corrigendum, he has also included the allegation that the assessee has cleared the goods under Chpt. X procedure without payment of duty a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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