9911796707
TMI Blog2006 (12) TMI 271X X X X Extracts X X X X X X X X Extracts X X X X ..... at the appellant are manufacturers of embroidered products falling under chapter heading no. 5805.19 of the Schedule to Central Excise Tariff Act, 1985 and opted for the discharging the duty liability under the provisions of Rule 96ZH of the Central Excise Rules, 1944 and also availed Modvat credit on the capital goods and utilized the same for discharge of the duty liability. A show cause notice was issued for wrong utilization of Modvat credit and demand of the duty and also for imposition of penalty, on the ground that the appellant is precluded from availment of benefit of any other provisions of the Central Excise Rules, 1944. Appellant resisted the show cause notice on two grounds i.e. that the benefit of beneficial legislation like M ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... regards the availment of the benefit of the provisions of Rules 96ZH to 96ZM and Modvat and held against the assessee. As regards the ultra vires of the impost on capacity of production it was his submission that there is no conflict. The impost is on the production of the goods and the levy and collection is under Section 3 of the Central Excise Act, 1944. For this proposition he relies upon the decision of the Hon'ble High Court of Madhya Pradesh in the case of Shree Synthetics Limited v. UOI as reported at 1982 (10) E.L.T. 97 (M.P.). 5. Considered the submissions made by both sides and perused records. It is undisputed that the appellant is discharging the duty liability on the embroidered products manufactured by him under the pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e 96ZI(1) of Central Excise Rules, 1944 is clarificatory and prospective in operation." 6. It is noticed that the issue on merits is squarely covered by the decision of the division Bench and respectfully following the same, the appeal of the appellant is devoid of merits. 7. As regards the time-bar issue I find the show cause notice is for the demand of clearances made during the period September 1998 to February 1999. The show cause notice is issued to the appellant on 11-3-99, which is well within the period as indicated under the provisions of Section 11A of the Central Excise Act, 1944. The monthly returns for the month of September 98 are to be filed by the appellant on or before 5th October 1998 and the limitation period ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ranted." 9. It can be noticed that the discharge of the duty liability under the said rules were optional and that also after the permission is granted by the jurisdictional Commissioner. If the duty liability is to be discharged at the option of the assessee and the assessee having full knowledge of the same opts for observing the provisions of the Rules 96ZH to 96ZM cannot turn around now and say that the impost under these rules are ultra vires. Section 3(1) of the Central Excise Act, 1944 read as under : "Sec. 3 - Duties specified in the First Schedule to be levied. - (1) There shall be levied and collected in such a manner as may be prescribed duties of excise on all excisable goods other than salt which are produced or manufact ..... X X X X Extracts X X X X X X X X Extracts X X X X
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