- (1.) This appeal is preferred by the Appellant against order dated 10-8-2004 passed by the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) [2004 (175) E.L.T. 869 (Tri.-Del.)]. By the impugned order, the appeal of the Appellant has been dismissed. The facts leading to the present appeal, questioning the validity of the aforesaid order, read as under:
(2.) The Appellant herein is holding Central Excise Registration and is engaged in the manufacture of paints, varnish, primer, enamels and distempers falling under Chapter 32 and bituminous mixtures falling under Chapter 27 of the First Schedule to the Central Excise Tariff Act, 1985. As per the Appellant, it was availing MODVAT credit on all the movable inputs during the financial year 1999-2000. As on 31-3-2000, it had a closing stock of inputs and finished goods involving MODVAT credit of Rs. 86,222/- whereas the closing balance in RG-23A Part II was nil. With effect from 1-4-2000, it had started availing total exemption from payment of duty under Notification No. 8/2000 : /2000, dated 1-3-2000. The amount of Rs. 86,222/- related to the credit of inputs was debited by the Appellant in the Profit and Loss Account on 3-10-2000, i.e., on a later date. Interest thereupon was also deposited in TR-6 challan dated 22-12-2000.
(3.) A show cause notice was issued to the Appellant on 27-3-2001 calling upon them to show cause as to why Central Excise duty of Rs. 14,28,370 be not recovered from the Appellant Under Section 11A of the Central Excise as duty payable on the finished goods manufactured and cleared by the Appellant during the period 1-4-2000 to 16-9-2000. The main reason for issuance of show cause notice was that the Appellant had not debited the balance of Rs. 86,222/- on 1-3-2000, when it had started availing the exemption from payment of duty under Notification No. 8/2000 but had done subsequently, i.e., 3-10-2000. The Appellant submitted reply to the show cause notice in which it was pleaded that all the conditions contained in Notification No. 8/2000 had been fulfilled by the Appellant for exercising the option to avail the exemption under the said Notification and merely because the MODVAT credit in the sum of Rs. 86,222/- which was there with the Appellant as on 31-3-2000 was debited later on, i.e., 3-10-2000, would not be of any relevance.;