Suiti Exports Ltd. Vs. Commissioner of Central Excise

Suiti Exports Ltd. vs Commissioner of Central Excise

Type Court Judgment Court Customs Excise and Service Tax Appellate Tribunal CESTAT Mumbai Decided Feb 24, 2003

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Citation: sooperkanoon.com/30113
Court: Customs Excise and Service Tax Appellate Tribunal CESTAT Mumbai
Judge: S T Gowri, G Srinivasan
Decided On: Feb 24, 2003
Subject: Excise

Case Summary

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

Excise

Key legal issue: Excise

Parties & Advocates

Appellant / Petitioner

Suiti Exports Ltd.

Respondent

Commissioner of Central Excise

Legal References

Reported In: (2004)(91)ECC423

Excerpt

1. the appellant was engaged in the fabrication of various goods out of steel strips. it placed orders on the manufacturer of the steel coils, and directed the manufacturer to send the coils to cutters. the cutter cut the coils into sheets and sent the sheets to the appellant who thereupon took credit of the duty paid on the coils by their manufacturer. the notice issued to it proposed to deny the credit on the ground that what was received in its factory was different from the coil on which duty has been paid. the deputy commissioner confirmed the proposal in the notice and his order having been confirmed by the commissioner (appeals), the matter is before us.2. counsel for the appellant contends that it followed the procedure contained in rule 57ac(5) and that there is no contravention. he relies upon the decision of the tribunal in dhimant trading co. and ors. v. cc (appeal 3712/01 and ors.).3. the departmental representative reiterates what the commissioner (appeals) has says.4. it is somewhat difficult to appreciate what the commissioner (appeals) says. he has said as follows: "it was necessary on the part of the sender of the duty paid inputs to either deface the duty paying documents or endorse the same so as to co-relate the present consignment with the duty paid inputs originally received in the form of hr coils by the job workers. but this doesn't appear to have been done. in the absence of such evidence at the best the adjudicating officer could arrive at a pro-rata figure for the credit to be allowed to the appellants on the strength of the challans even if he wanted to take a liberal view and not denying the substantive benefit. unfortunately modvat rules do not permit this because credit could be allowed only on the basis of duty paying documents and if other parties received duty paid inputs then they had to furnish necessary declarations that no credit was availed by the job worker who received duty paid inputs by making necessary endorsement or.....

Full Judgment

1. The appellant was engaged in the fabrication of various goods out of steel strips. It placed orders on the manufacturer of the steel coils, and directed the manufacturer to send the coils to cutters. The cutter cut the coils into sheets and sent the sheets to the appellant who thereupon took credit of the duty paid on the coils by their manufacturer. The notice issued to it proposed to deny the credit on the ground that what was received in its factory was different from the coil on which duty has been paid. The Deputy Commissioner confirmed the proposal in the notice and his order having been confirmed by the Commissioner (Appeals), the matter is before us.

2. Counsel for the appellant contends that it followed the procedure contained in Rule 57AC(5) and that there is no contravention. He relies upon the decision of the Tribunal in Dhimant Trading Co. and Ors. v. CC (appeal 3712/01 and Ors.).

3. The departmental representative reiterates what the Commissioner (Appeals) has says.

4. It is somewhat difficult to appreciate what the Commissioner (Appeals) says. He has said as follows: "It was necessary on the part of the sender of the duty paid inputs to either deface the duty paying documents or endorse the same so as to co-relate the present consignment with the duty paid inputs originally received in the form of HR Coils by the job workers. But this doesn't appear to have been done. In the absence of such evidence at the best the adjudicating officer could arrive at a pro-rata figure for the credit to be allowed to the appellants on the strength of the challans even if he wanted to take a liberal view and not denying the substantive benefit. Unfortunately modvat rules do not permit this because credit could be allowed only on the basis of duty paying documents and if other parties received duty paid inputs then they had to furnish necessary declarations that no credit was availed by the job worker who received duty paid inputs by making necessary endorsement or defacing or submitting a disclaimer certificate that no credit was availed at his end." 5. This does not seem to us very relevant to the issue. The show cause notice issued to assessee did not cite as the reason for denying the credit, the fact that credit had already been taken on the duty paid coils by the cutter. All that it said was that while the duty paying documents described the goods as coils, the appellant had received sheets in its factory, which were different.

6. The decision of the Tribunal cited by the counsel for the appellant has dealt with this issue and indicated the circumstances under which correlation could be established. The Commissioner (Appeals)'s view about the pro-rata figure is confusing. There is no denial that the weight of sheets was the same while the appellant received the coils.

We are unable to find any cogent reason for the Commissioner (Appeals)'s order.

Same Court & Year Customs Excise and Service Tax Appellate Tribunal CESTAT Mumb... Same Parties Suiti Exports Ltd. vs Commissioner of Central Excise Same Subject Excise Same Judge S T Gowri, G Srinivasan