9911796707
TMI Blog1993 (8) TMI 185X X X X Extracts X X X X X X X X Extracts X X X X ..... s in question, namely, LDPE granules manufactured by M/s. Indian Petrochemicals Corporation Limited, Baroda and of countervailing duty paid on the same product imported by the said Corporation on the ground that they had received the said inputs without proper documents evidencing payment of duty and that such documents as were later on produced were not correlated by them to the invoices of M/s. Orissa Small Industries Corporation Limited. 2. As identical issues are involved in the two Appeals and common arguments were advanced by the respective sides, we are passing a combined order disposing of the two Appeals. 3. Both the Appeals relate to Modvat Credit of Rs. 2,60,608.87 and Rs. 9,73,740.31 paid as Central Excise duty and Rs. 15,95,394.38 paid as countervailing duty on manufactured and imported materials respectively. It has been urged in the Appeals that the respondents had availed Modvat Credit on inputs received without cover of the required duty-paying documents, that they had not obtained permission from the Assistant Collector under Rule 57H(1) of the Central Excise Rules for the transitional period and that in some cases they availed Modvat Credit without filing the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... legal and proper. The same may be set aside and the respondents directed to debit the sums in question from their RG 23A Part II or from their P.L.A. and also pay the penalties imposed. 6. The Appeals were argued on behalf of the Appellant Collector on different dates by the learned Senior Departmental Representative, Shri M.N. Biswas and finally by Shri N.K. Mandal, learned Junior Departmental Representative. The learned Departmental Representatives strongly supported the grounds urged in the Appeal and pleaded for the setting aside of the impugned Order-in-Appeal. The contentions raised in the Appeal about the receipt of the inputs without the required documents and the submission of certificates and Gate Passes after a long time were reiterated by them in support of their pleading. 7. The arguments were opposed by Shri K.K. Banerjee, learned Counsel appearing for the respondents. He explained that they are the only purchasers for the particular variety of LDPE granules from M/s. Orissa Small Industries Corporation (OSIC). The latter are the distributors of the goods in question manufactured by M/s. Indian Petrochemicals Corporation (IPCL) and the imported LDPE canalised by t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... c Paints The ratio of these decisions would clearly support the decision of the Collector (Appeals) impugned in the present Appeals. He also pointed out that the department has finalised the RT-12 returns for the period April 1986 to May 1990 vide the Order dated 28-2-1992 passed by the Superintendent of Central Excise, Balasore. He referred to the copy of the said Order submitted by him along with the written note of submission handed over by him at the time of the hearing. In the said order it was mentioned that the RT-12 were assessed finally and no differential duty was recoverable from them. Shri Banerjee submitted that this order also would have its effect on the question of demand relating to Modvat Credit raised in the present Appeals. The learned Counsel concluded his arguments with the plea that the Appeals be dismissed and the order of the Collector (Appeals) upheld. 8. We have considered the submissions made by both the sides. We have gone through the record. We find that the grounds urged in the Appeals only relate to credit availed without valid documents. The issues relating to non-obtaining of Assistant Collector s permission under Rule 57H and taking of credit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he authorities and permitting availment of credit. Liberty was allowed, however, to the Assistant Collector to cause any inquiry or investigation to satisfy himself about the genuine nature of the Gate Passes and also about non-utilisation of the Gate Passes at the earlier stages of endorsements for availment of Modvat Credit. 9. In the present case, though the entire quantity covered by the Gate Passes had not been sold at one go to the respondents but on different days in a piecemeal manner, they had lifted the entire quantity covered by the Gate Passes or what was left in the Gate Passes after the issue of subsidiary Gate Passes in favour of other purchasers (e.g. G.P. No. 1996 dated 11-11-1986 in respect of which there is reference to issue of subsidiary Gate Passes for 5.5 Metric Tonnes). There is also an endorsement on the reverse of this Gate Pass that 10 Metric Tonnes of the material were transferred to their Distributors M/s. B.C. Paul Co. There is a subsequent endorsement by IPCL that a quantity of 4.5 Metric Tonnes transferred to OSIC to sell to Multilayer Composites. In Gate Pass No. 3984 dated 11-11-1986 while the endorsement of IPCL about sale of 6 Metric Tonnes t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was irregular. Though in the circumstances of the case and in view of the production of Gate Pass at a later stage, the eligibility for Modvat Credit cannot be denied, the imposition of penalty for contravention of the said proviso to sub-rule 2 of Rule 57G is justified. This attracts penalty under Rule 173Q(1)(bb) as a case of taking credit of duty wrongly. The element of mens rea is not a prerequisite under the said provision. As the charge has been clearly specified in the notice and confirmed in the order, non-mention of sub-rule (1)(bb) does not vitiate the order. Accordingly, we partially allow the Appeals in so far as the question of penalty is concerned but dismiss the Appeals as far as the grant of Modvat Credit is concerned. The eligibility for Modvat Credit is to be given effect to in accordance with the impugned Orders-in-Appeal passed by Collector (Appeals) which are upheld to that extent. 10. As we have dismissed the Appeals on the question of grant of credit on merits, we are not deciding the plea of the learned Counsel for the respondents that the show cause notices for recovery of the credit amounts were barred by limitation. From the copy of the order dated 28- ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
