Morarjee Brembana Ltd. Vs. Commissioner of Central Excise - Court Judgment

Excerpt:
1. heard both sides. by order dtd. 07/01/2003 the hon'ble high court, bombay, has directed the appellants to make pre-deposit of rs. 30 lakhs within a period of 8 weeks from the date of the order and also furnish a bank-guarantee of balance amount of rs. 30 lakhs of nationalised bank within a period of 12 weeks from the date of the order.2. the appellants vide their letter dtd. 27/03/2003 have informed that they have submitted to the commissioner, central excise, nagpur a bank guarantee of rs. 30 lakhs and have also deposited a sum of rs. 30 lakhs from cenvat credit account under rg23 a part ii vide entry no. 416 dtd.03/03/2003 in compliance of the directions of hon'ble high court. shri.prakash shah, learned advocate states that the debiting of cenvat credit account is permissible in view of the karnataka high court decision in the case of u.o.i. and ors. v. vikrant tyres ltd. reported in 1999 (35) r.l.t. page 427 (kar.) and decision of the tribunal in the case of swil limited v. c.c.e. calcutta-i reported in 1999 (31) r.l.t.page 848 (cegat). he submits that the payment from cenvat accounts is equivalent to cash deposit in view of the said decisions. besides, the eou has already been debonded, therefore, it is at par with domestic unit and is entitled to utilize cenvat credit.3. shri m.k. gupta, learned jt.c.d.r. appearing on behalf of the revenue submits that since the appellants are an e.o.u., they cannot deposit the amount of rs. 30 lakhs from their cenvat credit account, as the modvat scheme is not applicable to an 100% e.o.u.4. in view of the above, we direct the appellants to seek the confirmation from the commissioner, central excise, nagpur, as to whether he is satisfied with the payment from cenvat credit account.thereafter, if necessary the appellants may have to seek the clarification from the hon'ble high court. (sic) a copy of this order may be given dasti to both the parties.

Judgment:
1. Heard both sides. By Order dtd. 07/01/2003 the Hon'ble High Court, Bombay, has directed the appellants to make pre-deposit of Rs. 30 Lakhs within a period of 8 weeks from the date of the order and also furnish a Bank-Guarantee of balance amount of Rs. 30 Lakhs of Nationalised Bank within a period of 12 weeks from the date of the order.

2. The appellants vide their Letter dtd. 27/03/2003 have informed that they have submitted to the Commissioner, Central Excise, Nagpur a bank guarantee of Rs. 30 Lakhs and have also deposited a sum of Rs. 30 Lakhs from Cenvat Credit account under RG23 A Part II vide Entry No. 416 dtd.

03/03/2003 in compliance of the directions of Hon'ble High Court. Shri.

Prakash Shah, learned Advocate states that the debiting of Cenvat Credit account is permissible in view of the Karnataka High Court decision in the case of U.O.I. and Ors. v. Vikrant Tyres Ltd. reported in 1999 (35) R.L.T. Page 427 (Kar.) and decision of the Tribunal in the case of Swil Limited v. C.C.E. Calcutta-I reported in 1999 (31) R.L.T.Page 848 (CEGAT). He submits that the payment from cenvat accounts is equivalent to cash deposit in view of the said decisions. Besides, the EOU has already been debonded, therefore, it is at par with Domestic unit and is entitled to utilize cenvat credit.

3. Shri M.K. Gupta, learned Jt.C.D.R. appearing on behalf of the Revenue submits that since the appellants are an E.O.U., they cannot deposit the amount of Rs. 30 Lakhs from their cenvat credit account, as the modvat scheme is not applicable to an 100% E.O.U.4. In view of the above, we direct the appellants to seek the confirmation from the Commissioner, Central Excise, Nagpur, as to whether he is satisfied with the payment from cenvat credit account.

Thereafter, if necessary the appellants may have to seek the clarification from the Hon'ble High Court. (SIC) A copy of this order may be given Dasti to both the parties.