Commissioner of Central Excise Vs. Brand Alloys Ltd. - Court Judgment

Excerpt:
1. this appeal is directed against the order-in-appeal dated 31.3.2004 wherein the ld. commissioner (appeals) has allowed the appeal of the respondents.2. none appeared for the respondent despite notice. since the matter is of 2004, i take up the appeal for disposal.3. considered the submission made by the ld. jdr and perused the records.4. the issue involved in this case is denial of mod vat credit to the respondents on the ground that the respondent had taken the modvat credit on the invoices issued by different registered dealers without supplying the input materials in the said invoices. the period involved in this case is 1996.97. the ld. adjudicating authority confirmed the demand and also imposed equivalent amount of penalty. the ld. appellate authority has allowed the appeal of the respondent on the ground that the department has not established that the credit was availed fraudulently.5. i find that during the relevant period the registered dealers were required to produce the original invoice under which they have availed credit in rg.23d register to the jurisdictional superintendent of central excise while preparing invoice to their purchasers. the said provisions are enumerated under rule 57gg(12)(b), which reads as under: where the entire quantity has not been sold, the range superintendent shall endorse on the back of the invoice, details relating to the quantity received, quantity issued, total amount of duty available as inputs stage credit (hereafter referred to as the said duty), amount of the said duty for which invoices have been issued, and the balance quantity and the balance amount of the said duty available for issuing invoices.6. from the above rule it is very clear that the superintendent of central excise was required to monitor the quantity of the inputs which were purchased by the dealer and sold by him. in the hands of respondent, the respondents have document in form of invoice of registered dealer which is issued to him after producing all the records to the jurisdictional superintendent of central excise. to my mind, the credit availed by the respondent cannot be said to be recovered unless there is a concrete evidence about non-movement of inputs to the respondent.7. in view of the facts and circumstances as mentioned above, the commissioner (appeals) order does not require any interference and the appeal filed by the department is dismissed.

Judgment:
1. This appeal is directed against the Order-in-Appeal dated 31.3.2004 wherein the Ld. Commissioner (Appeals) has allowed the appeal of the Respondents.

2. None appeared for the Respondent despite notice. Since the matter is of 2004, I take up the appeal for disposal.

3. Considered the submission made by the ld. JDR and perused the records.

4. The issue involved in this case is denial of Mod vat credit to the Respondents on the ground that the Respondent had taken the Modvat credit on the invoices issued by different registered dealers without supplying the input materials in the said invoices. The period involved in this case is 1996.97. The ld. Adjudicating Authority confirmed the demand and also imposed equivalent amount of penalty. The ld. Appellate Authority has allowed the appeal of the Respondent on the ground that the Department has not established that the credit was availed fraudulently.

5. I find that during the relevant period the registered dealers were required to produce the original invoice under which they have availed credit in RG.23D register to the jurisdictional Superintendent of Central Excise while preparing invoice to their purchasers. The said provisions are enumerated under Rule 57GG(12)(b), which reads as under: where the entire quantity has not been sold, the Range Superintendent shall endorse on the back of the invoice, details relating to the quantity received, quantity issued, total amount of duty available as inputs stage credit (hereafter referred to as the said duty), amount of the said duty for which invoices have been issued, and the balance quantity and the balance amount of the said duty available for issuing invoices.

6. From the above Rule it is very clear that the Superintendent of Central Excise was required to monitor the quantity of the inputs which were purchased by the dealer and sold by him. In the hands of Respondent, the respondents have document in form of invoice of registered dealer which is issued to him after producing all the records to the Jurisdictional Superintendent of Central Excise. To my mind, the credit availed by the Respondent cannot be said to be recovered unless there is a concrete evidence about non-movement of inputs to the Respondent.

7. In view of the facts and circumstances as mentioned above, the Commissioner (Appeals) order does not require any interference and the appeal filed by the Department is dismissed.