9911796707
TMI Blog1999 (12) TMI 212X X X X Extracts X X X X X X X X Extracts X X X X ..... Blankets (hereinafter referred to as CCFB), treating the same as capital goods under Rule 57Q ibid, on the strength of invoices issued by M/s Orient Cerwool Ltd., manufacturers of the said goods. Out of the aforesaid total credit amount, the credit of Rs. 15,400/- was taken on 20-9-1995, the credit of Rs. 15,040/- was taken on 4-11-1995 and that of Rs. 39,000/- was taken on 4-12-1995 in RG-23C Part II. The Department proposed to disallow the above credits and recover the duty amounts, by way of a show cause notice, alleging that the goods in question were not covered under the definition of capital goods under Rule 57Q ibid and that the party had not complied with the provisions of sub-rule (2) of Rule 57T of the Central Excise Rules ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at case were cerwool pads used as lining material for the furnace in the appellants factory. Such lining with cerwool pads prevented the escape of heat from the furnace and ensured optimum operational conditions for the manufacture of the final products. The cerwool pads were, therefore, held to be integral parts and/or accessories of the furnace and accordingly, the same were held to be classifiable under Clause (b) of the Explanation to Rule 57Q(1) of the Central Excise Rules. The Tribunal, therefore, held that cerwool pads used as lining material for furnace were eligible capital goods for the purpose of Modvat credit under Rule 57Q ibid. I observe, going by the undisputed facts regarding the nature and use of the CCFB in the appellants ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... filing intimation Amount of credit taken Date of taking credit Date of utilizing credit 753 dt. 15-9-1995 21-9-1995 15,400/- 20-9-1995 28-9-1995 979 dt. 1-11-1995 6-11-1995 15,040/- 4-11-1995 7-11-1995 1122 dt. 1-12-1995 5-12-1995 39,000/- 4-12-1995 6-12-1995 5. The intimation of the receipt of the goods, in respect of which credit of duty was taken on 20-9-1995 was given by the appellants on 21-9-1995, in which case there is a delay of one day. For the receipt of the goods, in respect of which the credit of duty was taken on 4-11-1995, the appellants gave the required intimation on 6-11-1995 in which case there is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ital goods under Rule 57T(2). The finding of the lower appellate authority that the party had not applied for condonation of delay also does not appear to be correct. The reply given by the party to the show cause notice certainly contained their request for condonation of delay, which the adjudicating authority ought to have considered in the right perspective. As regards penalty, I observe, that the lower appellate authority has recorded a finding that the appellants had taken credit of duty to which they were not entitled and, therefore, the imposition of penalty by the adjudicating authority was justified. This finding is, per- se, erroneous inasmuch as the appellants were entitled to the credit of duty taken by them on the capital good ..... X X X X Extracts X X X X X X X X Extracts X X X X
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