- (1.) THE question involved in these appeals is whether an assessee is bound to avail of exemption or can forgo the same in order to avail MODVAT credit. The assessee, relying upon a trade notice dated 11-3-1988 issued by the Central Excise and Customs Collector, did not avail of an exemption granted under Exemption Notification No. 53/88 dated 1-3-1988. The trade notice stated that it was the option of the assessee either to avail of the full exemption available or to pay the duty leviable on the goods manufactured by him. If the assessee chose to pay the duty in spite of the goods being fully exempted, MODVAT credit could not be denied on such duty paid inputs if used in the manufactured final products. The respondent assessee accordingly, chose to pay the duty and availed of the MODVAT credit.
(2.) SUBSEQUENT to the issuance of the notification, the trade notice dated 11-3-1988 was withdrawn on 4-1-1991. This trade notice being Trade Notice No. 008/91, stated that the matter has been reexamined and it was clarified that the assessee had no option but to avail of the exemption in case the goods were fully exempted from payment of duty. A show cause notice was accordingly issued to the respondent on 19-7-1991 for recovery of the MODVAT credit which had been utilised by the assessee. The demand raised in the show cause notice was confirmed by the Assistant Collector. The appeals preferred by the assessee were rejected by the Collector of Central Excise. However, the Customs, Excise and Gold (Control) Appellate Tribunal (CEGAT) reversed the findings of the Department and held, relying upon an earlier decision of the Tribunal, that the assessee had the option not to avail of the exemption but to pay the duty and avail of the MODVAT credit.
(3.) THE Department is in appeal before us. Apart from the question whether the Department ought to be allowed to question the decision of the Tribunal when the Tribunal had merely relied upon its earlier decision which decision has not been challenged by the Department, we are of the view that there is no necessity to interfere with the decision of the Tribunal in view of the fact that it is the admitted case as stated in the special leave petition, that the issue is merely technical and that there was no revenue implication.;