9911796707
TMI Blog2004 (9) TMI 526X X X X Extracts X X X X X X X X Extracts X X X X ..... 7-1987 was rejected by the then Assistant Commissioner in A.O.No. V/48/30/5/87-MP 2 dtd. 23-2-1988 (H) dtd. 31-8-1988 and by order No. 643/91 dtd. 22-11-1991 in the CEGAT order No. 1945/96 dtd. 18-10-1996, the appellants are not eligible to the credit on the inputs for the period from 29-7-1987 to 9-7-1992. The action of the appellants in taking the Modvat credit in RG 23A Part II in February, 1997 for felts and wires for the period from 1987 to 1992 is in gross violation of the provisions of Modvat rules and against the orders of the Commissioner (Appeals) dtd. 31-8-1988 and CEGAT order dtd. 22-11-1991 as referred to above. The appellants have also failed to maintain the account of the receipt of the inputs and their issues for utilization/consumption in the manufacture of the final products in RG 23A Part I. 9. In the light of the above discussions, disallowance of the Modvat credit of Rs. 51,56,038/- by the Assistant Commissioner is in order. The impugned order passed by the Assistant Commissioner is sustainable." 2. The appellants had filed a declaration on 29-7-1987 to avail credit of duty paid on the inputs 'felts and wires' under Rule 57G of Central Excise Rules, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... do not apply to the facts of this case. In the result, this application is dismissed." 3. In the meanwhile the appellants again filed a fresh Modvat declaration dtd. 7-7-1992 seeking permission to avail Modvat credit on felts and wires as the issue had been decided in the case of Straw Products Ltd. [1992 (59) E.L.T. 572] in assessee's favour to grant Modvat credit on this item. With regard to the previous period from 1987 they mentioned in the said declaration as follows : - "We are accordingly submitting a fresh declaration against inputs 'Felts and Wires' which may please be acknowledged at the earliest. We would file a refund claim against duty paid during the period 1-3-1987 till the date of acknowledgement and also duty involved on stocks held as on 28-2-1987 against the above two inputs, separately." 4. The Assistant Commissioner by his letter dtd. 3-6-1994 responded to the appellants' further letters dtd. 18-5-1994 to issue an acknowledgement to the said declaration filed and informed them that since the CEGAT in Final Order No. 643/91 had rejected the benefit of Modvat credit on felts and wires, therefore, there was no question of giving acknowledgement to th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2 and advised the assessee to expunge the credit of Rs. 51,56,038/-. The assessee replied to the show cause notice dtd. 24-11-1997. In this reply they have stated that they were reversing the same under protest and subject to their filing their appeal the Assistant Commissioner in impugned Order-in-Original dtd. 19-5-1998 in Paras 9 & 10 has held as follows :- "9. I have carefully gone through the records of the case, Show Cause Notice personal submission made during the course of hearing. Rule 57A enables an assessee about his applicability and Rule 57G is for filing the required declaration to avail Modvat Credit on inputs. The assessees have failed to enter the inputs in the RG23A Part-I account and no issues were shown in the accounts but took the credit in RG23A Part-II, which is irregular. On being pointed out they reversed an amount of Rs. 51,56,038/- under protest stating that without prejudice to their right to restore the credit at a later date based on favourable orders and requested to make available an appealable order. They have not offered any satisfactory explanation about the irregular availment of Modvat Credit. In the absence of such an explanation it is to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under RG23A Part II. It is his submission that as acknowledgement to declaration had not been furnished they could not have maintained the registers and their taking suo motu credit on the basis of subsequent judgments of the Tribunal is justified. It is their submission that when the Tribunal has in the subsequent proceedings in Order No. 1945/96 has held that they are entitled to the credit on 'felts and wires', then they were entitled to take the credit for the previous period although for the previous period the Tribunal rejected their prayer in the ROM application and had not modified the same. He submits that the subsequent order of the CEGAT in 1945/96 sub silentio and even if a wrong order is passed it should be accepted as noted in the case of V.S. Charati v. Hussein Nhanu Jamadar [AIR 1999 SC 1488] and that of State of Punjab v. Gurdev Singh [AIR 1991 SC 2219] when Revenue has not challenged such a wrong order. 10. Ld. Central Government Standing Counsel submitted that both the judgments cited by the Senior Counsel are not applicable as the Tribunal rejected the assessee's prayer for ROM after the order No. 1945/96 was passed and as the declaration filed by them its ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... td. 18-10-1996 is not a sub silentio order. The Revenue was not required to have filed an ROM as contended by the Senior Advocate to seek clarification as the Tribunal itself had clarified, in the assessee's ROM that the order of the Tribunal in 643/91 confirms for the period 1987 to 1992 and the benefit of subsequent judgment cannot be extended to them. The Supreme Court judgments relied by the Counsel stating that a wrong order of the court becomes binding even when it is not appealed is not applicable to the facts of the case. There is no wrong order which was not appealed and which is required to be given effect in the matter. The declaration dtd. 7-7-1992 was subject matter of Order No. 1945/96 and the allowing of Modvat credit on felts and wires was only from the date of the declaration and not for the previous period from 1987 to 1992 as for that period the assessee themselves have stated that they would file refund claim. In these circumstances, their taking Modvat credit suo motu was irregular and was not established and it was rightly rejected by the Assistant Commissioner and Commissioner (Appeals) in the impugned order. There is no merit in the appeal and the same is re ..... X X X X Extracts X X X X X X X X Extracts X X X X
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