9911796707
TMI Blog2005 (11) TMI 138X X X X Extracts X X X X X X X X Extracts X X X X ..... the appellants is also irrelevant to the present issues as in the said case law i.e. in case of M/s. Diesel Components Works v. CCE, there is no mention of credit of capital goods taken by the concerned assessee. The issue in the said case law is only in respect of waste and scrap generated by dismantling of locomotives and whether dismantling amounts to manufacture. The present issue is in respect of capital goods sold as waste and scrap and therefore, the question whether dismantling amounts to manufacture or not, does not arise. The appellants' argument that demand of duty on wires and cables as scrap is not sustainable as the said scrap had been handed over to them by M/s. ELL is not tenable as the appellant has not produced any registe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lty is imposable on them. I do not accept the plea as the appellant at material time while clearing the waste and scrap of capital goods did not inform the Department about the clearance of the said item and thus suppressed the material facts from the Department with an intention to evade the Central Excise duty. However, since duty is paid before the issue of Show Cause Notice after realizing their mistake, I reduce the penalty from Rs. 12,82,857/- (Rupees Twelve Lakhs Eighty Two Thousand Eight Hundred Fifty Seven only) to Rs. 6,50,000/- (Rupees Six Lakhs Fifty Thousand only), which was imposed under Section 11AC of the Central Excise Act, 1944." The order except modifying the Section 11AC penalty was upheld. Thus duty of excise amountin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ands cannot be upheld as made and confirmed. (c) The onus cast by the CCE (A) on the assessee to follow the case is not upheld. The Department has to bring out based on cogent evidence, that the scrap referred in this case has arisen from such capital goods on which credit was availed. That capital goods credit was availed on the basis of a presumption cannot be upheld. The demands under Rule 57S(2) are, therefore, not substantiated from evidence on record. (d) Similarly, for the other items, e.g. bearing, valves, etc., it was required to be established as to credit under Rule 57A was declared and availed by the appellants, before the provision of Rule 57F demands on such input scrap could be made. In the absence of any material ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Gases and the scrap of wires/cables arose from wires/cables installed in November 1996 as pleaded, i.e. much before the Modvat Credit Rules came into existence. (g) In view of the finding that no duty demand can be made/upheld in this case, penalty under Rule 173Q(1) cannot be upheld. The penalty under Rule 173Q(1) is also not upheld as no specific sub-clause of Rule 173Q(1) has been invoked following Steelco Gujarat Ltd. v. CCE, Vadodara - [2000 (121) E.L.T. 747 (Tri.)] (h) We find force in the submission that the entire proceedings under Central Excise Rules, 1944 as initiated in this case, are barred. They are not saved following Sunrise Structural Engg. Ltd. Ors. v. CCE, Nagpur - [2004 (117) ECR 307 (Tri)]. (i) ..... X X X X Extracts X X X X X X X X Extracts X X X X
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