1. This appeal is directed against the order dated 18-4-1991 passed by the Commissioner of Central Excise (Appeals), New Delhi. The appellants herein are manufacturing forged products of iron [&] steel. They took deemed modvat credit under Rule 57G of the Central Excise Rules, on certain inputs namely M.S. rounds, alloy steel rounds and round bars.
The jurisdictional Assistant Commissioner of Central Excise Faridabad issued two show cause notices demanding duty for the period March 1989 to August 1989 and for the period September 1989 and October 1989 on the ground that these inputs are not eligible for deemed credit because these are not covered under the order of the Govt. of India Ministry of Finance No. 342/1 /88-TRU dated 20-5-1988. The Assistant Commissioner held that these inputs are classifiable under Heading 72.14 or 72.28 Central Excise Tariff Act, 1985 and in the deemed credit order items falling under these headings are not covered. The Commissioner (Appeals) upheld the Assistant Commissioner's order.
2. Shri N.N. Sharma learned Consultant appeared for the appellants and Shri Mewa Singh learned SDR for the revenue.
3. On a consideration of the submissions we find that there are two orders No. 342/1/88-TRU dated 1-6-1989 issued by the Ministry of Finance under Rule 57G(2) of Central Excise Rules. One order has been issued insuper-session of the order dated 1-3-1989, in that order the description of the input, the heading number in the Central Excise Tariff Act, and the rate of deemed credit of duty have been specified in the table annexed to that order. The second order is a general one.
In this order which is issued in supersession of the order dated 20-10-1987, it has been stated that the ingots and re-rollable materials of iron or steel purchased from outside and lying in stock on or after 1-6-1989 with the rerollers may be deemed to have paid duty at the rate of Rs. 500 per M.T. and the credit of duty under Rule 57A in respect of such ingots and rerollable materials used without undergoing the process of melting in the manufacture of goods falling under Chapters 72 and 73 of CETA may be allowed at the rate of Rs. 500 per M.T. without production of documents evidencing payment of duty.
Perusal of the record shows that apparently both the lower authorities have not considered the scope of the second deemed credit order referred to above. The materials in. question being in the nature of rerollable materials would be covered by this order. The appellants have produced before us another order of the Commissioner (Appeals) dated 31-12-1990 in respect of M/s Agarwal Forging India wherein the Commissioner (Appeals) has accepted this position, in a similar situation of claim for deemed credit on M.S. rounds in that case.
Therefore it is held that the inputs in this case for which deemed credit has been taken by the appellants are covered by second order dated 1 -6-1989 which is of a general nature and in this view of the matter the impugned order is set aside and the appeal is allowed.