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TMI Blog2012 (9) TMI 817X X X X Extracts X X X X X X X X Extracts X X X X ..... 1986. In the month of September, 1999, the assessee took Modvat credit of Countervailing Duty (CVD) paid on various inputs imported during April to December, 1998. 3. The jurisdictional Superintendent of Central Excise issued a notice dated 27-3-2000 and a Corrigendum dated 3-4-2000 to the assessee calling upon them to show cause as to why the credit amounting to Rs. 2,15,72,897/- should not be disallowed on the ground that the credit had been availed after 6 months from the date of issue of the Bill of Entry held to be the same as the date of payment of CVD. The assessee submitted a detailed reply justifying the credit claimed. However, the original adjudicating authority by his Order-in-Original dated 31-8-2004 allowed part of the credit and disallowed the Modvat credit availed on the Bills of Entry on the ground that the credit was availed after 6 months from the date of issue of bills of entry. Aggrieved by the said order, the assessee preferred an appeal under Section 35-B of the Central Excise & Salt Act, 1944 (hereinafter referred to as 'the Act' for short) before the appellate Tribunal, Bangalore. In view of the conflicting opinions on the aforesaid question the Trib ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... order is passed and handed over to the assessee, the period of 6 months as stipulated in sub-rule (5) of Rule 57G is to be computed, and not 6 months from the date of the assessee handing over the Bill of Entry as required under Rule 46 of the Customs Act. 5. Per contra, the learned counsel appearing for the Revenue pointed out from the Circular issued by the Department bearing No. 275/109/96-CX, dated 26-11-1996 that in case imported inputs or the duty of filing of Bill of Entry the period of 6 months should be effected from the date of payment of duty and therefore it is the payment of duty which is starting point of limitation for 6 months under sub-rule (5) of Rule 57G of the Rules. 6. Therefore the point that arises for our consideration in this appeal is : "In the case of a manufacturer who receives the inputs in the factory under cover of "Bill of Entry" from what date the period of six months specified in sub-rule (5) of Rule 57(G) is to be calculated?" 7. The Larger Bench of the Appellate Tribunal at Bangalore after considering the rival contentions held as under : "In the earlier judgment rendered by the Tribunal under Sections 46 and 47 of the Customs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r under Section 47(1). The triplicate copy of Bill of Entry (assessed) containing the payment of duty would be retained alongwith the out-of-charge order by the importer taking delivery of the goods for home consumption. Where the Bill of Entry was generated on E.D.I. system, duplicate and triplicate print-outs of the document would upon assessment and payment of duty be returned to the importer vide procedure laid down under the Bill of Entry (Electronic Declaration) Regulations, 1995 issued by the Board under Section 157 of the Customs Act. In the previous system it was only the triplicate copy of Bill of Entry that was returned at the same stage. 9. Bill of Entry as defined under Section 2(4) of the Customs Act means a Bill of Entry referred to under Section 46 of the Act. Section 46 provides for presentation of a Bill of Entry to the proper officer of customs by the importer for home consumption of the goods imported by the latter. Section 47 of the Act governs further procedure in relation to the document upto clearance of the goods for home consumption. This procedure includes return of Bill of Entry by the proper officer to the importer for the purpose of payment of du ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... having jurisdiction over his factory, indicating the description of the final products manufactured in his factory and the inputs intended to be used in the said final products and such other information as the said Assistant Commissioner may require, and obtain a dated acknowledgement of the said declaration. (2) A manufacturer who has filed a declaration under sub-rule (1) may, after obtaining the acknowledgement aforesaid, take credit of the duty on the inputs received by him. (3) No credit under sub-rule (2), shall be taken by the manufacturer unless the inputs are received in the factory under the cover of any of the following documents, namely : (a) an invoice issued by a manufacturer of inputs under Rule 52A or 100E of the said Rules; (b) an invoice issued by the manufacturer of inputs from the depot or from the premises of the consignment agent of the said manufacturer or from any other premises from where the goods are sold by or on behalf of the said manufacturer provided the depot or the premises, as the case may be, is registered under Rule 174; (c) &nb ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sp; No credit shall be taken by the manufacturer in respect of invoices referred to in clause (g) of sub-rule (3) after the 30th September, 1996. (5) Credit shall also not be taken by the manufacturer after six months of the date of issue of any document specified in sub-rule (3) and where the intermediate products manufactured by the user of inputs specified under Rule 57 are received by the manufacturer, after nine months. 12. It is not in dispute that in exercising the powers conferred by Section 47 of the Central Excise Act, 1944 and the Central Excise Rules, 1944, the Central Government made the Central Excise Rules, 2001 which should have come into effect from 1st day of July 2001 by the Notification No. 9/2001-C.E. (N.T.), dated 1st March, 2001. The said notification was resisted and the Central Government made a Central Excise (No. 2) Rules, 2001 by issuing Notification No. 30/2001-C.E. (N.T.), dated 21-6-2001. On the same day in exercise of the powers conferred by Section 37 of the Central Excise Act, 1944, the Central Government made the CENVAT Credit Rules of 2001. The period of limitation of six months which is contained in sub-rule (5) of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d that where the bill of entry is returned for payment of duty before the commencement of the Customs (Amendment) Act, 1991 (55 of 1991) and the importer has not paid such duty before such commencement, the date of return of such bill of entry to him shall be deemed to be the date of such commencement for the purpose of this section : Provided further that if the Board is satisfied that it is necessary in the public interest so to do, it may, by order for reasons, to be recorded, waive the whole or part of any interest payable under this section." 15. If the importer pays the import duty as assessed, the proper officer may make an order permitting clearance of the goods for home consumption. It is only thereafter the importer can bring the goods imported to his factory under the cover of the said Bill of Entry or any other document mentioned in sub-section (3) of Rule 57G. Except in the case of the Bill of Entry as provided in Clause 'D' or 'K' inspite of all other documents, six months period has to be calculated from the date of issue of the document. There is no difficulty in understanding the date of issue in respect of those documents. The problem arises only in the cas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t." 17. Therefore, the department understood these provisions insofar as the Bill of Entry is concerned as six months from the date of payment of duty. This circular is binding on the revenue. In the light of the circular the finding recorded by the larger bench that the six months period has to be computed from the date of Bill of Entry returned to the importer after assessment of the tax payable as the date for commencement of the claim on credit under sub-rule (5) of Rule 57G is ex facie incorrect. However, we may point out that in view of the aforesaid statutory provisions coupled with the fact that the said rules regarding limitation is no more in the statutory books any more, it would be proper to hold that six months period has to be computed from the date of handing over of the out-of-charge order to the importer. The reason being that even after payment of duty by the importer, unless an order under Section 47(1) of the Act is passed and that copy of the order is handed over to the importer he cannot get the goods for home consumption. If after such an order is handed over to him he commits delay in getting the goods, he cannot take advantage of such delay. But once ..... X X X X Extracts X X X X X X X X Extracts X X X X
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