Full Judgment
3. The above Modvat credit had been taken on the countervailing duty (CVD) paid on three consignments of inputs which the appellants had procured in a high sea sale transaction. The said goods were purchased by the appellants from M/s Hemant Plastics & Chemicals Ltd. and M/s Supreme Industries Ltd. The credit of CV duty was taken by the appellants on the strength of three triplicate Bills of Entry, two of them standing in the name of M/s Supreme Industries and the other in the name of Hemant Plastics Ltd. 4. A show-cause notice was issued by the Department proposing to disallow the credit to the appellants on the ground that the Bills of Entry did not carry the importers' declaration that they did not intend to avail Modvat credit of the CV duty under Rule 57-A of the Central Excise Rules, 1944 in respect of the imported goods. The allegation in the show-cause notice was denied by the party. The original authority and the first appellate authority upheld the proposal for denial of Modvat credit.
5. In the present appeal, one of the grounds raised against the impugned order is that the order has travelled beyond the scope of the show-cause notice. It is this ground which has been highlighted by the learned Counsel for the appellants today. Counsel points out that the lower appellate authority has accepted the fact that the importers' declaration is very much on the Bills of Entry. The authority has, however, denied the Modvat credit on the ground that the said declaration of the importers had not been endorsed by the proper officer of Customs. The Commissioner (Appeals) has held that, in the absence of proper signature of the Customs officer, Bill of Entry cannot be considered as a genuine and valid document in law for the purpose of availment of Modvat credit. The learned Counsel, in this context, submits that it has never been the Deptt.'s case that the Bills of Entry were invalid for want of endorsement by Customs officer.
6. I have heard the learned DR also, who submits that the importer's declaration must be there on the reverse side of the Bill of Entry and not on any separate sheet of paper attached to the document as in the instant case. It is his further submission that the declaration on the reverse side of the Bill of Entry should be duly countersigned by the proper officer. In the instant case, this is also missing.
7. I have carefully considered the submissions and examined the triplicate Bills of Entry in question (shown by the appellants' counsel). The duty-paid nature of the inputs covered by these documents is clear enough. On the reverse side of the Bill of Entry relating to the goods sold to the appellants by M/s Hemant Plastics and Chemicals Ltd., the requisite declaration is available, though not countersigned by any officer of customs. Insofar as the other two Bills of Entry relating to the goods sold to the appellants by M/s Supreme Industries Ltd. are concerned, there is no such declaration written, printed or otherwise entered on the reverse side of the document as rightly pointed out by the DR. However, attached to each of these two Bills of Entry is a separate declaration of the importer on their letter head, which is also not countersigned by any officer of Customs. The learned DR has argued that the two Bills of Entry relating to the goods sold by M/s Supreme Industries Ltd. cannot be considered to be valid documents for Modvat purpose for want of importer's declaration on the reverse side thereof. I am unable to accept this argument which is too hypertechnical at this length of time and is not supported by any allegation in the show-cause notice. The next objection by the DR is that, in respect of any of the three Bills of Entry, there is no countersignature of the proper officer of Customs for the importers' declaration. This argument, as rightly pointed out by the Counsel, is beyond the scope of the show-cause notice inasmuch as the show-cause notice had not raised such an allegation. The allegation was that there was no declaration by the importer. As already noted there is no dispute of duty-paid nature of the goods nor of utilization thereof in the manufacture of final products in the appellants' factory. The substantive conditions have admittedly been fulfilled by the party. The ground raised by the lower authorities for denying the Modvat credit is untenable for the reasons already stated. The impugned order is set aside and the appeal is allowed with consequential reliefs to the appellants.