NATIONAL STEELS Vs. C.C.E.

JUDGEMENT

(1.) THE appellants have preferred an appeal against the Order -in -Appeal dated 10.2.2003 wherein the Commissioner (Appeals) upheld the confirmation of the duty against the appellant.

(2.) RELEVANT facts for consideration in the case are that the appellant is a manufacturer of M.S. products falling under Chapter No. 72 of the schedule to the Central Excise Tariff Act, 1985, and was also availing Modvat credit facility. The appellant during the month of June and August 1995, availed Modvat credit on the M.S. scrap. The appellant availed the Modvat credit on the duty paying documents issued by M/s Mahabir Prasad and Co., Ghaziabad. The said M/s Mahabir Prasad and Co. was subjected to scrutiny by the officers and the officers found that the said M/s Mahabir Prasad and Co. issued invoices for 'M.S. scrap', a description shown on the original and duplicate copy of the invoices, while the triplicate copy of the same invoice was showing description of the "Empty Containers". The said M/s Mahabir Prasad and Co. was issued a show cause notice -cum -demand dated 16.7.96, and the current appellant was shown as one of the co -noticee for the imposition of penalty under Rule 173Q of Central Excise Rules, 1944. In one of the annexure to the said show cause notice dated 16.7.96 issued to M/s Mahabir Prasad and Co., the current appellant was shown as recipient of the invoices under which no goods were delivered, but only invoices were issued, for availing the Modvat credit. The said show cause notice was adjudicated and the current appellants were penalized u/r 173Q of CER, 1944. The current appellant paid off the penalty imposed on them. The department issued a show cause notice on 18.5.99 to the appellant, seeking to reverse the credit of the duty availed by them on the very same invoices. The adjudicating authority, on adjudication, confirmed the demand and also imposed a penalty on the appellants. On appeal, the Commissioner (Appeals) upheld the confirmation of demand but set aside the penalty imposed on the current appellant.

(3.) SHRI Bipin Garg, the learned Advocate submits that the current show cause notice issued to the appellants is totally time -barred and is not in consonance with the settled law on the issue. He submits, that, the appellants were not aware that the seller of the material "MS scrap" was erring while preparing the duty paying documents. He also further submits that when the appellants purchased the MS scrap from the said Mahabir Prasad and Co., they received the scrap from their seller, hence the allegations that the appellants have not received 'MS scrap' is ill founded, and submits that the impugned order suffers from the infirmity.