9911796707
TMI Blog2002 (4) TMI 183X X X X Extracts X X X X X X X X Extracts X X X X ..... ongly taken credit of A.E.D. on nylon tyre cord fabric of Rs. 2,77,96,280/- in RG 23A Part II register vide Entry No. 2271, dated 7-10-96 for the period April, 95 to March, 96. The credit was required to be taken within six months of the date of issuance of the invoices but they took after expiry of that period and as such, the same was not permissible under the rules. They were requested to reverse the credit but they failed to do so on the plea that they had not utilised the amount. Accordingly, show cause notice dated 23-4-97 was issued to them seeking recovery of the amount under Rule 57-I of the Rules. The assessee, however, contested that notice by alleging that they had taken the credit of B.E.D. within time on nylon tyre cord fabric but due to clerical error, they did not make entry in respect of A.E.D. credit in their record within six months. They are entitled to take credit legally. They also averred that the credit of A.E.D. had not been utilised by them as A.E.D. had ceased to be payable on the final product. A.C., however, did not agree with their version and confirmed the demand and also imposed penalty of Rs. 1,00,000/- through the order-in-original dated 16-12-99. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e very invoices could not be made, at that time, inadvertently or by error, therefore, they were entitled to make entry in the record after the expiry of six months of the A.E.D. credit, cannot be accepted being devoid of law. It cannot be disputed that B.E.D. and A.E.D. are two different and distinct duties payable by the assessee in accordance with law. The credit taken of the B.E.D. cannot be utilised under the law for discharging A.E.D. liability except when it has been made so made permissible by law or the rule. Similarly, the credit of A.E.D. cannot be utilised for discharging B.E.D. except where it had been so provided by the statute/rules. The credit of both these duties had to be independently taken and utilised by the assessee. By taking credit of one duty within the prescribed limit, the credit of other duty cannot be deemed to have been taken by the assessee when it had not been entered in the relevant record. Therefore, mere taking of the credit of B.E.D. within the specified period of six months, did not authorise the assessee to take credit of A.E.D. after expiry of that period even if the duty paid documents were the same and the goods were also not different. 10. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e same could not be taken. When this fact came to the notice of the Excise Department from perusal of their RT-12 return, for the month of October, 96 that Modvat credit for the period April, 95 to March, 96 of the disputed amount had been wrongly taken, the assessee was firstly through the letters dated 23-12-96 and 3-1-97, requested to reverse the same being not permissible under the rules. The assessee did not accede to that request by taking the plea that he had not utilised that amount. Thereafter, the department was left with no option but to serve the show cause notice on him. In the show cause notice, no doubt, he was called upon to show cause as to why the credit amount be not recovered under Rule 57-I of the Rules and penalty be not imposed under Rule 173Q of the Rules. But all the relevant facts rendering the taking of the Modvat credit by him after six months, as illegal and irregular, were detailed in the show cause notice for the knowledge and information of the assessee. 13.The object of serving the notice on the assessee was to disallow the assessee the Modvat credit of the disputed amount which he had wrongly taken in contravention of the provisions of Rule 57G of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , where necessary the Court/Tribunal may even depart from the rule that plain words should be interpreted according to their plain meaning. In order, to avoid patent injustice, anomaly or absurdity or to avoid invalidation of law, the Court/Tribunal would be well justified in departing from the so-called golden rule of construction so as to give effect to the object and purpose of the notice or enactment by supplementing the written word, if necessary. 17.Keeping in mind above said principle/rule of construction, and the law, the impugned show cause notice issued to the assessee in the instant case, wherein all the details had been furnished and brought to his notice, rendering the very taking of the credit by him illegal and irregular, cannot be held to be in any manner invalid, for the simple cause that technically, the action proposed, therein was the one which was not properly worded. The object of serving the show cause notice on the assessee was to disallow/cancel the Modvat credit which he had taken of huge amount of Rs. 2,17,71,168/- in contravention of the statutory provisions of Rule 57G of the Rules. It is not his case that he was misled or confused by the wording of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is takes us to the appeal of the Revenue. Admittedly, the Modvat credit had been taken by the assessee of a huge amount, detailed above, in contravention of the provisions of Rule 57G of the Rules. It cannot be said, in the light of the discussions made above, that assessee had acted in a bona fide manner especially when he did not show their willingness to treat it as cancelled or disallowed, when he was made request by the department through two letters dated 23-12-96 and 3-1-97, for that purpose. The department had to serve the show cause notice on him and till now, he had not accepted his fault of having taken the credit illegally and improperly as the same was not permissible to him, under the law. Therefore, keeping in view the conduct of the assessee and the circumstances of the case, the penalty deserves to be imposed on him. The Commissioner (Appeals) had not recorded any cogent reasons for quashing the penalty of Rs. 1,00,000/- as imposed through the order-in-original by the A.C. on the assessee. No doubt, in our view, the amount of penalty imposed by the A.C. was also inadequate and insufficient but still we do not want to interfere with the same on account of non-utili ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
