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TMI Blog2002 (6) TMI 562X X X X Extracts X X X X X X X X Extracts X X X X ..... ith by this Bench s Admission Order No. 7/2002(CE), dated 20-2-2002. 2. A final hearing in the aforesaid case was taken up by the Bench on 24-5-2002 and 28-5-2002, when Shri Shankar Raman, Advocate appeared on behalf of the applicant and Shri K. Chandrasekaran, Supdt. represented the Revenue. 3. The Bench has gone through the facts and relevant records of the case, as also the evidences and citations relied upon. The brief facts of the case are already incorporated and discussed in the aforesaid Admission Order. In short, the issue relates to non-reversal of Modvat Credit of Rs. 24,07,505/-, availed on receipt of certain inputs, which were subsequently cleared as such without being utilized in the manufacture of specified final products ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at in terms of Rule 57-I(5) of the erstwhile CER as it stood during the material time, no interest would be chargeable in the instant case. It was pleaded that liability to interest under the said Rule 57-I (5) arises only when a credit was availed wrongly. However, in the instant case on the date of availment (taking) of Modvat Credit, the applicant was correctly entitled to avail the same. Some of the materials were also used for the manufacture of final production. The remaining material could not be used only due to their short shelf life and, consequently, they became waste. Accordingly, it was urged that since they have not wrongly availed any credit, they are not liable to pay interest at all. The counsel relied on the decisi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r, the amendment of Rule 57-I to build therein provision for time limit for recovery, the provisions of Section 11A will not apply at all to case of recovery under Rule 57-I of Modvat credit incorrectly availed. Therefore, ab initio, the proposal to demand under proviso to Section 11A read with sub-rule 1(ii) of erstwhile Rule 57-I in the SCN is questionable. In this case the allegation being that the applicant had cleared modvatted inputs without payment of duty as provided for under the Rules, the erstwhile Rule 57-I(2) empowered demand in respect of such inputs (on which credit had been taken) not fully accounted for as having been disposed off in the manner specified in the Modvat provisions. Since invoking of Section 11A itself is not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 11AB of the CEA read with sub-rule 57-I(5) of the erstwhile CER is, ab initio, not valid. 9. As for the request for immunity from prosecution, the counsel has brought on record instructions of the Central Board of Excise and Customs that the monetary limit for launching prosecution is enhanced to Rs. 25 lakhs (Board s letter F.No. 208/31/97/CX. 6, dated 12-12-97). Considering this and the duty involved in the instant case being less than Rs. 25 lakhs, the Bench concludes that the instant case falls outside the monetary limit laid down for prosecution by the CBEC. Revenue has also not brought on record any specific reasons as to why in spite of the Board s guidelines, the applicant deserves to be prosecuted in this case. 10. Accordingly, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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