9911796707
TMI Blog1997 (11) TMI 190X X X X Extracts X X X X X X X X Extracts X X X X ..... ags made out of jute, paper and plastic strips for packing the cement. According to the appellants, they had filed a declaration on 28-3-1987 under Rule 57G mentioning, among other things, HDPE bags as one of the inputs. At that time there was a dispute about the classification of HDPE bags which came to be resolved by the Board s letter dated 25-9-1992 classifying HDPE bags under Chapter 39 and not under Chapter 63. According to the appellants, since they were receiving the said bags under Chapter 39 and not under Chapter 63 during the relevant period they could not take any Modvat credit in the RG 23A Part II or enter these bags in their RG 23A Part I, as Chapter 63 was not included in the notification issued under Rule 57A during the rel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the appellants had taken wrong and illegal Modvat credit during the period 1987-88 to 4-10-1990 that credit was not admissible in view of the exclusion clause in Rule 57A for HDPE bags; that the appellants had not maintained prescribed records, viz., RG 23A Part I and Part II at the time of receipt of HDPE bags. Personal hearing were fixed on 4-4-1994 and 29-4-1994 for which the present appellants sought adjournment. Thereafter the impugned order dated 8-6-1994 was passed by the Collector ex parte. 4. Appearing for the appellants Shri A.K. Jain, ld. Advocate, submitted that the Collector had wrongly held that the benefit of Modvat credit on HDPE bags used as packaging was not admissible. Ld. Advocate also submitted that the Collector ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t packaging material is not excluded from the purview of input where final product is liable to specific rate of duty. As regards the issue of time limit for taking of Modvat credit, the ld. Counsel referred to the Supreme Court decision in Government of India v. Citadel Fine Pharmaceuticals, 1989 (42) E.L.T. 515 (S.C.) wherein the Supreme Court had held that the expression reasonable time can extend even to two years. He also referred to the Apex Court decision reported in AIR 1994 SC 1878 wherein it was held that in cases where no time limit had been prescribed, there can be no valid reason for holding any particular period as mandatory. There was no justification, therefore, for the Collector to hold that six months was the reasonable ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... contended that the said six months period would commence from the date of knowledge of the appellants of the law laid down by the Tribunal for the first time in this respect and for this purpose the limitation period should commence from the date of publication of the judgment of the Tribunal in the case of Orissa Cement Ltd. case, namely, July, 1993. Applying the test of reasonable time limit laid down by the Supreme Court in the case of Citadel Fine Pharmaceuticals (supra) read with the other judgment of the Tribunal holding that the limitation would be six months, even then, the period of limitation would come to an end only in January, 1994, whereas the appellants had taken credit in August, 1993 well within a month of publication of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y the Appellants they have submitted that the matter should not be remanded to the Commissioner to decide the question of the period of limitation for taking Modvat credit as the said issue was not a ground either in the SCN or in the impugned order. 7. We have considered the submissions made on behalf of the parties. On the question of eligibility for Modvat credit of HDPE bags used for packing cement the Collector had held that since cement is assessable to specific rate of duty and the cost of packing material was not included in the assessable value of cement, HDPE bags could not be treated as an inputs under Rule 57A. He had further observed that since under Section 4(4)(d)(i) assessable value excluded the cost of material which is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eld by the Tribunal in 1991 (52) E.L.T. 590. We observe that the Apex Court in Govt. of India v. Citadel Fine Pharmaceutical [1989 (42) E.L.T. 515] held that what would be reasonable time would depend on the facts of each case. The Asstt. Collector had observed in his order that there was no doubt about the eligibility for Modvat credit. Appellants had contended that they had taken credit within six months of the first publication of the decision in CCE, Bhubaneswar v. Orissa Cement (supra). Therefore, even adopting the yardstick of six months as the reasonable period, they had claimed that their claim for Modvat credit was admissible. We are inclined to accept the above submission of the ld. Advocate in the light of the Apex Court judgment ..... X X X X Extracts X X X X X X X X Extracts X X X X
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