Full Judgment
Modvat Credit to them on the ground that the suppliers of M.S. bars-had paid duty treating their furnace batch type and not in accordance with the capacity of production determined by the Commissioner. On appeal, filed by the respondents, the Commissioner (Appeals) has set aside the Order-in-Original on the ground that the order passed by the Commissioner determining the annual capacity of production had been remanded by the appellate Tribunal for re-fixation of annual capacity of production which was still pending.
3. The revenue has contended that the benefit of Notification No. 58/97 is available only if the appropriate duty has been discharged by the supplier of the raw-material and as the issue regarding re-determination of capacity and consequently the quantum of duty to be paid by the supplier on the inputs is still pending, the respondents were not eligible to take the Modvat Credit.
4. We have considered the submissions of the learned DR and perused the records. Notification No. 58/97 provides that the duty of excise aught to have been paid on the inputs specified in the notification and deemed credit shall be equivalent to the amount calculated & 12% of the price and credit of the deemed duty so determined shall be allowed to the manufacturer of the final products. It is not in dispute that the suppliers of M.S. bars-had paid the duty under Section 3A of the Act and bars are covered by Notification No. 58/97. The only dispute between the suppliers of the bars and the Department is regarding determination of the annual capacity of production. It is also not disputed by the Revenue that after remand by the Tribunal, vide Final Order No. A/953-63/02-NB dated 8.4.2002, the Department has so far not determined the annual capacity of production of the suppliers concerned. In view of these facts, it cannot be claimed by the Department that the respondents are not eligible for availing the deemed Modvat Creditas appropriate duty had not been paid by the suppliers. The Punjab & Haryana High-Court in the case of Vikas Pipe v.CCE, Chandigarh 2003 (59) RLT 976 (P&B) has Held that "Deemed Modvat Credit can be claimed in terms of assessee should produce the invoices covering the goods in which the manufacturer should give a declaration that the manufacturer had suffered excise duty. In the case before us, the show cause notice issued to the assessee itself points out that the suppliers have been declaring on these invoices that the inputs suffered excise duty " Thus, we find no merit in the appeal, filed by the Revenue, which is rejected. (Operative part of order pronounced in Open Court on 17.3.2004).