Judgment:
1. In these two appeals, the Asst. Commissioner of Central Excise, Jaipur vide his two Orders No.124/96 and No. 134/96 both dated 14.2.96 has disallowed the modvat credit of Rs.1,11,115/- and Rs.50,842/- respectively under Rule 57-1 of the Central Excise Rules, 1944. The appellants have been asked to reverse the aforestated amounts of credit on the ground that they had availed the same on the strength of challans issued by the depots of M/s. Steel Authority of India Ltd. (SAIL), which reflected excess amount than the duty paid on these items by the plants of M/s. SAIL. The Asst. Commissioner in his order has observed that according to the modvat credit scheme, only the credit to the extent of duty paid on inputs can be availed. If duty has not been paid, credit cannot be availed which is a well established principle in law. He has observed that the party before him did not make any submission with regard to the fact that the credit availed by them was in excess of the duty actually paid. On the other hand, they contended that they were not responsible for the lapse committed by the Jaipur depot of M/s. SAIL. He has also observed that the assessee absolutely remained silent on the fact that the credit in excess of the stated amount had been availed by the assessee and this fact has not been disputed by them.
2. The party filed appeal against the above orders of the Asst.
Commissioner, but the same stood dismissed by the Order-in-Appeal dt.
17.10.2000 passed by Commissioner (Appeals), Jaipur.
3. The present are the second stage appeals filed by the party. The matters are listed today for hearing Stay Petitions of the appellants.
I have heard Shri K.K. Anand, Advocate for the appellants and Shri A.K.Jain, JDR for the respondents. In this case, it is not disputed by the ld. Advocate for the appellants that the party had availed more credit of duty than what was paid by the plant of M/s. SAIL on the goods covered by the impugned challans. He however, relies on the C.B.E.C Circular No. 486/52/99-CX dated 23.9.1999 issued from F.No.202/05/97-CX.6, in which a Scheme has been approved under which the verification in the weight of the materials as despatched from the plants and as finally sold from the stockyards/depots is to be reconciled on annual basis and a report submitted to the jurisdictional Deputy/Asst. Commissioner of Central Excise by 31st May of the subsequent financial year by the person in charge of each stockyard/depot. Subsequently, a summary of the position of all the stockyard/depots would be made plant-wise and sent to the respective plants by 15th July. In case there is any net excess quantity, the plants will make the excise duty payment at the rate of duty existing on the last day of that financial year or at the highest rate prevalent during the year under consideration. In the light of these instructions, it is the submission of the ld. Advocate for the appellants that the differential duty demand made on the appellants has to be made up by the concerned plant of M/s. SAIL and not by the party concerned. However, it is observed that as the scheme itself would envisage, this scheme can have only a prospective application and cannot be made applicable retrospectively for the period under consideration. The matter is at the stay stage and I find no deficiency in the orders passed by the lower authorities. The appellants admittedly have availed the credit of duty in excess of the one paid on the inputs covered by the challans. Therefore, prima facie, they are liable to pay back the same. Accordingly, I direct them to make the deposit of entire amount of duty confirmed on them on or before 16.5.2001. The matter will be called for reporting compliance on 18.5.2001.