9911796707
TMI Blog1995 (3) TMI 258X X X X Extracts X X X X X X X X Extracts X X X X ..... 2. The learned Advocate for the appellants has pleaded that the appellants had filed the necessary declaration for the purpose of availing of the Modvat Credit as required under Rule 57G. Having filed the declaration they failed to comply with the other procedure prescribed viz. the submission of monthly returns of the Modvat Credit taken along with the RT. 12 returns. He has pleaded that this was only a technical lapse on the part of the appellants. He pleaded that the appellants vide their letter dated 24-11-1989 had filed a consolidated return in respect of the Modvat Credit taken by them for the entire period of February to September, 1989. He pleaded that so long as the appellants had claimed the benefit of the Modvat credit within a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e inputs as the inputs were received in the appellants factory and have chosen to consolidate the credits in the RG. 23A Part I register and submitted a return of the consolidated Modvat Credit taken for the period February to September, 1989 under the cover of their letter dated 24-11-1989. The question that arises for consideration is whether in such a situation the appellants could be taken to have rendered themselves ineligible for the purpose of the benefit of Modvat Credit in respect of the declared inputs under Rule 57G. It is seen that in terms of Rule 57G(3) the manufacturer availing of the Modvat Credit in respect of the notified final products under Rule 57A is required to maintain an account in RG. 23A Part I and Part II and in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vat Credit availed of by the appellants and to ensure that the Modvat credit taken and utilised is in respect of the notified declared inputs and finished products in terms of Rule 57A read with Rule 57G of the Central Excise Rules. It goes without saying that compliance with these provisions of these rules is essential as otherwise there is no way to verify as to how the assessees are going about availing and utilising the Modvat Credit taken. It is, however, possible that an assessee on account of some lapse on the part of their employess or some other reason may not take the Modvat Credit on the inputs immediately after same are received and may wake up to the omission regarding taking of the Modvat Credit later. The question is in such ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e after their receipt in the factory as the goods received would be covered by proper gate passes and necessary accounts as prescribed under Central Excise Rules and also maintained by the assessees would be available and it should not be diffcult for the authorities to correlate the goods with the gate passes. In any case if the assessees fail to correlate the credit taken with the Gate passes under which the goods which entered the factory, the authorities are free to take action under Rule 57-I of the Central Excise Rules for recovery of the credit wrongly taken. We do not see as to how the interests of the Revenue are prejudiced if the assessees choose to take the credit after a lapse of time after the date of receipt of the goods insid ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng documents and also subject to the bar of limitation of 6 months rather than from the date on which the consolidated declaration was filed. We observe that the appellants have cited the case of the North Regional Bench in the case of H.C.L. Ltd. v. C.C.E., Meerut, reported in 1994 (71) E.L.T. 608 (Tribunal) under which the Bench has observed that where no limitation is prescribed, the Modvat credit should be taken within the reasonable time and 10 months time has been taken to be reasohable for the purpose and in that case a delay of 10 months from the date of the payment of duty were taken as reasonable. We observe that in the context of Rule 57-I providing for recovery of the Modvat Credit at the time when no limitation was prescribed u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is point was by the Bombay Bench in Collector of Central Excise v. Bharat Containers Pvt. Ltd. [(1990(48) E.L.T. 520 (Tribunal)]. The Tribunal held thus - (Para 5). When the credit has been taken wrongly or it is in excess of the eligibility, it is a case of erroneous credit, which can be recovered by a demand. Such demand cannot go beyond the purview of the statutory provisions of Section 11A of the Central Excises Salt Act, 1944. Even if Rule 57-I is sought to be invoked, it is to be read with the provisions of Section 11A, which is the statutory provision for recovery of any duty- either short-levy or non-levy or duty taken erroneously as proforma or Modvat Credit . I fully agree with the reasoning of the Tribunal." In view of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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