GUEST KEEN WILLIAMS LTD Vs. COLLECTOR OF CENTRAL EXCISE

JUDGEMENT

(1.) THIS is an appeal against the order of the Collector of Customs & Central Excise (Appeals), Madras, dated 29-1-88. Brief facts of the case are that the appellants took MODVAT credit for duty of Rs. 1,890.20 and Rs. 1,599.60 in their RG-23A Part 11 register for the reason that after the receipt of the inputs in their factory there was later variations in the duty payment on the goods and to the extent further duty was paid by the manufacturer who manufactured the inputs, the appellants took these credits to that extent. These credits the appellants took in terms of the provisions of Rule 57E of the Central Excise Rules. The inputs which were received suffered duty based on the rate shown in the duly paying documents. THIS rate the authorities found was not correctly mentioned and recovered the differential duty towards those inputs. The lower authority held that under Rule 57E the adjustment in the credit taken could be made only in two situations, firstly where duty paid on inputs varied subsequently due to any reason resulting in the payment of refund to the manufacturer and secondly where the duty paid is varied subsequently due to the change in the classification of inputs on the basis of instructions issued by the Central Board of Excise & Customs resulting in the recovery of any duty from the manufacturer. The lower authority has held that since the appellants' case was not covered by any of these two situations, they were not entitled to the adjustment of credit of duty paid in addition to what was originally paid on account of the error detected at the hands of the manufacturer who supplied the inputs. THIS Rule, the lower authority has noted, no doubt was amended by Notification 117/87, dated 15-4-87 to the effect that credit could be taken by a manufacturer in case the duty paid on any inputs is varied subsequently due to any reason.

(2.) The appellant has sent a communication requesting for deciding the case on the basis of their submissions already made in the grounds of appeal.

(3.) IT is observed that the appellant took MODVAT credit for duty of Rs. 1,890.28 and Rs. 1,599.60 in their RG-23A Part II register on the certification by the manufacturer that they paid the same subsequently by applying the correct rate of duty on the inputs. The lower authorities by applying Rule 57E rejected the claim of the appellant. This Tribunal in the case of Indo National Ltd. v. C.C.E., Hyderabad -1989 (41) E.L.T. 422 (Tri.), referred to supra, which is similar to the present case, has held as under: