SMITHKLINE BEECHEM CONSUMER HEALTHCARE LTD. Vs. CCE
LAWS(CB)-2000-12-1
CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL BANGALORE
Decided on December 08,2000

Smithkline Beechem Consumer Healthcare Ltd. Appellant
VERSUS
CCE Respondents


Referred Judgements :-

N.K. CHEMICAL INDUSTRIES V. CCE [REFERRED TO]
MITTAL ENGINEERING WORKS PRIVATE LIMITED VS. COLLECTOR OF CENTRAL EXCISE MEERUT [REFERRED TO]


JUDGEMENT

G.R.SHARMA,MEMBER (T) - (1.)THE Commissioner (Appeals) in the impugned order held
Thus the disputed issue in this case boils down to the point as to whether the merger of Unit No. 1 with the Unit No. 2 is shifting of the plant or factory to another site or not. On this point, I observe that it is not the case of even appellants that they have merely shifted the plant or factory of unit No. 1 to another site. They do clearly admit that they have shifted the plant or factory to another factory belonging to them. There is difference between the word 'site' and 'factory'. But the appellants arguments are for eliminating this substantial difference between 'site' and 'factory'. It is obvious that their arguments are not correct and tenable since 'site' cannot be equated with the factory. In view of the above, I, therefore, find no merits in the appellant's contentions warranting any interference with the adjudication order in this case. The appeal is, therefore, rejected.

In the Order -in -Original the Asstt. Collector had held

Here it is true that both the plants belong to the same manufacturer being same partners but Rule 57F(6) allows transfer of un -utilised credit balance on account of shifting of the plant or factory to another site. Here the case is not of shifting to another site but the case is of Merger/amalgamation. Here the Unit I have lost their identity whereas for availing benefit of Rule 57F(6) the plant/unit should not have lost their identity. As per discussion above I hereby reject the request of the party for transfer of accumulated Modvat credit.

(2.)BEING aggrieved by this order, the appellants have filed the captioned appeal.
(3.)THE facts of the case in brief are that the appellants are engaged in the manufacture of Horlicks in bulk at their Rajamundry factory. The bulk product is cleared on payment of duty to the appellants packing station at Bangalore. At the packing station, the bulk product is repacked into smaller consumer packs. Such smaller consumer packs are cleared on payment of duty. Modvat credit of duty paid on bulk Horlicks is taken at Bangalore Packing Station. This credit is utilised for payment of duty on Horlicks cleared at Bangalore packing station.
Initially the assessment of clearances at Rajamundry factory was done on a provisional basis. These assessments were subsequently finalised. Consequent to which Rajamundry factory paid Excise duty of Rs. 18,34,599/ -. The Supdt. of Central Excise issued a certificate under Rule 57E of the Central Excise Rules to this effect. The packing station at Bangalore was closed down as a result of which the packing materials in stock and the machinery etc. were shifted to the packing station at Madras. Packing station at Bangalore took Modvat credit of differential duty amounting to Rs. 18,34,599/ - on the strength of the certificate issued by the Jurisdictional Supdt. on 29.8.1994. The appellants applied for transferring of the credit of Rs. 18,35,018.73 in -as -much as in addition to Rs. 18,34,599/ - an additional credit of Rs. 419.73 was lying in balance in R.G. 23A Part I at Bangalore packing station on the date of its closure. This request was made in terms of Rule 57F(7) of the Central Excise Rules. In the alternative, it was requested that cash refund as admissible under Rule 57E of the Central Excise Rules may be allowed. This request was turned down. Central Excise Registration Certificate at Bangalore was surrendered on 27 12.1995. The appeal was filed before the Tribunal which remanded the matter for de novo adjudication with the direction to examine the request of the appellant under the provisions of Rule 57F(7) and Rule 57E of the Central Excise Rules, 1944. The Commissioner in de novo proceedings rejected the request of the appellants for transfer of credit under Rule 57F(7) or refund in cash under Rule 57E of the Central Excise Rules.

Arguing the case for the appellants Shri G. Shiv Das, Ld. Counsel with Shri M.P. Devnath, Ld. Counsel submits that the sole reason for rejection of the request for transfer/refund of the amount was that no inputs/processed inputs were lying in stock equivalent to the credit sought to be transferred and that the provisions of Rule 57F(7) stipulated such a condition. It was argued for the appellants that Rule 57F(7) contemplated no condition for transfer of credit excepting that the transfer of the unutilised credit would take place on account of shifting of the plant or the factory belonging to the same manufacturer to another site; Rule 57F(7) was amplified by Notification No. dt. 16.8.1995. It was argued by the Ld. Counsel that the condition regarding the transfer of the inputs along with the transfer of the credit, came into effect on 16.8.1995 whereas their demand pertains to the period prior to 16.8.1995 and hence amended provisions of Rule 57F(7) will not be applicable in their case.



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