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TMI Blog1997 (9) TMI 310X X X X Extracts X X X X X X X X Extracts X X X X ..... ral Excise Tariff Act, 1985. The process of manufacture involves re-rolling of input without involving the process of melting. According to the department, appellants are not entitled to deemed credit in terms of Order No. 342/I/88/TRU, dated 12-7-1990, since the deemed credit, as per that order, is allowed only if inputs are not clearly recognizable as being non-duty paid or only exempted from duty or charged to nil rate of duty. The Assistant Collector has allowed the Modvat credit on the ground that the appellants have claimed deemed credit on the basis of another deemed credit Order No. 342/I/88-TRU, dated 12-7-1990 which is issued in respect of re-rollable material and as per this order, the deemed credit is allowed on re-rollable materials of iron and steel if these are used without undergoing the process of melting in the manufacture of goods falling under Chapter 72 or 73 and accordingly, assessee is eligible to deemed credit since the conditions of the deemed [credit] are fulfilled. On the other hand, the Collector (Appeals) on an application filed by the department under Section 35E(4), held that as the inputs have been moved from the mill after availing exemption [Notifi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the case of M/s. Omega Alloys Castings Pvt. Ltd. v. C.C.E., Indore - 1994 (71) E.L.T. 923 (Tribunal), wherein it has been held that inputs purchased from market to be deemed duty paid unless proved otherwise by department goods exempt from duty also not treatable as non-duty paid or charged to nil rate of duty - Rule 57G(2) second proviso of Central Excise Rules, 1944. 4. Arguing for the assessee, Shri Rajesh Chhibber, ld. Advocate submitted that the dispute is in respect of deemed credit order and though different deemed credit orders were dealt with in the respective impugned order, taking into consideration the similar wordings of the relevant deemed credit orders and particularly with reference to the deemed credit orders issued in respect of re-rollable material, the deemed credit cannot be denied. He submitted that the issue with reference to the deemed credit in terms of the respective deemed credit orders has been covered by the decision of the Tribunal in the case of Machine Builders v. C.C.E. reported in 1996 (83) E.L.T. 576 (Tribunal) up to 1-4-1987 and for subsequent period, the issue has been squarely covered by the decision of the Tribunal in the case of Pareek Pvt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uts are clearly recognisable as being non-duty paid and in the absence of such clause and since they have fulfilled the condition in using re-rollable materials without undergoing the process of melting, the deemed credit cannot be denied. Both the relevant deemed credit orders are as under : Order under Rule 57G Modvat - Deemed credit in respect of iron and steel, copper, aluminium, zinc and lead - Regarding. - After considering the representations received regarding grant of credit of duty paid on various ferrous and non-ferrous metals on a deemed basis, the Government have, in supersession of Order F. No. 342/1/88-TRU, dated the 1st June, 1989, decided to issue the following directions under the second proviso to Rule 57G(2) of the Central Excise Rules, 1944. 2. The inputs specified in column (2) of the Table hereto annexed and falling under heading Nos. or sub-heading Nos. of the Schedule to the Central Excise Tariff Act, 1985 (5 of 1986) specified in the corresponding entry in column (3) of the said Table, purchased from outside and lying in stock on or after the 16th day of July, 1990 with the manufacturers manufacturing the final products specified in the Notification ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ne, without production of documents evidencing the payment of duty. This order shall come into force on the 16th day of July, 1990. S/d- (R.K. Mahajan) 6. It seems that Govt. had issued two deemed credit orders on the very date i.e. 12-7-1990, one in respect of iron steel, copper, aluminium, zinc and lead, in general in which it was clearly mentioned that no such credit is available if such inputs are clearly recognisable as being non-duty paid or wholly exempt from duty or charged to nil rate of duty. But there was no such clause in the latter notification which was issued in respect of re-rollable material only. 7. The position is similar in the Appeal 1453/95 filed by M/s. H.V.R. Alloys Steel. They availed deemed credit during Feb., 1994 in terms of deemed credit order dated 12-7-1992 and same is as under : Modvat - Deemed credit in respect of re-rollable material [Chapters 72 73] Representations have been received from the Trade regarding grant of credit of excise duty paid on re-rollable materials on a deemed basis. The Govt. has in supersession of order issued under F. No. 342/T/88-TR ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... same are old, used, rejected and other scrap in the shape of structurals and machinery equipments which are in the form of re-rollable scrap. As such, the scrap purchased by the appellants from M/s. Rourkela Steel Plant has to be equated to the scrap purchased from outside and as deemed to be duty-paid. I also find that there is no restriction clause in the said order by Government of India restricting the appellants from availing the Modvat credit in case the inputs are clearly recognisable as being either non-duty paid or having been cleared at nil rate of duty. I fully agree with the submissions of the learned Consultant that this is one fact which places the said deemed credit order on a separate platform from the other deemed credit orders which contain a clause to that effect. In the absence of such a clause in the said order the same cannot be introduced as according to the well-settled principles of interpretation, fiscal provisions have to be given their plain meaning, if not ambiguous. As such, such a clause cannot be read into the deemed credit order in question. 6. I also find that the authorities below in their impugned orders have only relied upon one fact that no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... are clearly recognised being not duty paid or charged to nil rate of duty or wholly exempted from duty and in the circumstances of the case and in the absence of any evidence to show that the inputs have suffered the duty following the ratio, I hold that assessee is not entitled to deemed credit upto 1-4-1987. I find that Govt. has issued separate deemed credit order in respect of re-rollable materials from 1-4-1987 and relevant order is as under : Chapters 72 and 73 - Deemed credit on Iron Steel Chapters 72 and 73 - Deemed credit in respect of Re-rollable material allowed from 1-4-1987 at the rate of Rs. 365/- per tonne. Having regard to the representations received from the re-rolling units manufacturing goods falling under Chapter 72 or 73 of the Central Excise Tariff and paying on effective rate of duty of Rs. 500/- per metric tonne that they are not able to avail of the Modvat credit facility under Rule 57A of the Central Excise Rules because of their inability to produce duty, paying documents in respect of ingots and other re-rollable materials used by them as inputs the following direction under the Second proviso to Rule 57G(2) of the Central Excise Rules, 1944 ha ..... X X X X Extracts X X X X X X X X Extracts X X X X
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