Swadeshi Koreatex Vs. Cce

Swadeshi Koreatex vs Cce

Type Court Judgment Court Customs Excise and Service Tax Appellate Tribunal CESTAT Delhi Decided Feb 15, 2002

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Citation: sooperkanoon.com/27592
Court: Customs Excise and Service Tax Appellate Tribunal CESTAT Delhi
Judge: B T K.K.
Decided On: Feb 15, 2002
Subject: Service Tax

Case Summary

AI-generated summary - not the official court judgment text.

Service Tax

Key legal issue: Service Tax

Parties & Advocates

Appellant / Petitioner

Swadeshi Koreatex

Respondent

Cce

Legal References

Reported In: (2002)(81)ECC377

Excerpt

.....for the appellants submits that the substantive provisions of sub-rule (6) of rule 57g for availing the modvat credit on the original invoices, if the duplicate copy of the invoice has been lost in transit are that the inputs are received in the factory of the manufacturer and the duty on them has been paid. the assistant commissioner of central excise is to satisfy with regard to these conditions and allow the modvat credit to a manufacturer on the original invoice, if the duplicate copy of the invoice has been lost in transit. the id. consultant is contending that in their case it is not disputed that the duplicate copy of the invoice has been lost in transit. therefore, the deputy commissioner should have allowed the modvat credit on the original copy of the invoice after verifying the conditions as mentioned in the rules and on arriving at his satisfaction to allow them the modvat credit as per the impugned provisions. i find force in this contention. the modvat credit has been denied to the appellants on the ground that they did not take permission for availing the modvat credit on the original copy of the invoice. as rightly contended before me, the substantive provisions of rule 57g(6) are that the modvat credit on the original invoice is permissible, if the duplicate copy of the invoive is lost in transit subject to the satisfaction of the assistant commissioner that the inputs are received in the factory of the manufacturer and the duty is paid on such inputs. the assistant commissioner should have verified these particulars and if satisfied, should have allowed the modvat credit to the appellants. in the absence of such verification, denial of the modvat credit to the appellants is not proper. thus, i grant absolute stay to the appellants by setting aside the impugned order and remand the matter to the original authority for de novo consideration as per the observations made above. the appellants shall be afforded a reasonable opportunity of hearing.

Full Judgment

1. The appellants manufacture Blankets falling under Chapter 63. The present appeal relates to the modvat credit amounting to Rs. 90,037 availed by the party on the strength of original copy of the invoice No. 974164 dated 28.2.98 since the duplicate copy of the invoice was lost in transit. The Deputy Commissioner of Central Excise, Amritsar, vide his order dated 28.2.2000 has observed that the party pleaded before him that the duplicate copy of this invoice was lost in transit and could not be located; that the modvat credit on the original copy of the invoice is allowable in case the receipt and duty paid character of the inputs is not disputed as per the provisions of Rule 57G(6) of Central Excise Rules, 1944. The Deputy Commissioner in his order, however, rejected their plea with the observation that there is a provision for taking the modvat credit on the basis of original copy of the invoice in case the duplicate is lost in transit as provided under sub-rule (6) of Rule 57G which provision the party has not followed. He has accordingly disallowed the modvat credit to the party apart from imposing a penalty of Rs72,000.

2. The party filed an appeal but the same is rejected by the Commissioner (Appeals), Chandigarh, vide his order dated 28.8.2001. The Commissioner (Appeals) has relied on the decision of the Tribunal in the case of M/s. Avis Electronics (P) Limited , in which it is held that "this was a mandatory requirement and not a mere procedural technicality".

3. I have heard Shri R.L. Mehra, the Id. Consultant for the appellants and Shri S.C. Pushkarna, Id. JDR for the respondents. The Id.

Consultant for the appellants submits that the substantive provisions of sub-rule (6) of Rule 57G for availing the modvat credit on the original invoices, if the duplicate copy of the invoice has been lost in transit are that the inputs are received in the factory of the manufacturer and the duty on them has been paid. The Assistant Commissioner of Central Excise is to satisfy with regard to these conditions and allow the modvat credit to a manufacturer on the original invoice, if the duplicate copy of the invoice has been lost in transit. The Id. Consultant is contending that in their case it is not disputed that the duplicate copy of the invoice has been lost in transit. Therefore, the Deputy Commissioner should have allowed the modvat credit on the original copy of the invoice after verifying the conditions as mentioned in the rules and on arriving at his satisfaction to allow them the modvat credit as per the impugned provisions. I find force in this contention. The modvat credit has been denied to the appellants on the ground that they did not take permission for availing the modvat credit on the original copy of the invoice. As rightly contended before me, the substantive provisions of Rule 57G(6) are that the modvat credit on the original invoice is permissible, if the duplicate copy of the invoive is lost in transit subject to the satisfaction of the Assistant Commissioner that the inputs are received in the factory of the manufacturer and the duty is paid on such inputs. The Assistant Commissioner should have verified these particulars and if satisfied, should have allowed the modvat credit to the appellants. In the absence of such verification, denial of the modvat credit to the appellants is not proper. Thus, I grant absolute stay to the appellants by setting aside the impugned order and remand the matter to the original authority for de novo consideration as per the observations made above. The appellants shall be afforded a reasonable opportunity of hearing.

Same Court & Year Customs Excise and Service Tax Appellate Tribunal CESTAT Delh... Same Parties Swadeshi Koreatex vs Cce Same Subject Service Tax Same Judge B T K.K.