BALAJEE HI-TECH ROLLING PVT. LTD. Vs. CCE

JUDGEMENT

(1.) In these two appeals, filed by M/s. Balajee Hi -Tech Rolling Pvt. Ltd. and M/s. Patwari Udyog, the common issue involved is whether CENVAT Credit @ 12% of Invoice prices is available to them under Notification No. 29/2000 -CE (N.T.) dated 31.3.2000.

(2.) Shri R. Santhanam, learned Advocate, submitted that both the Appellants manufacture M.S. Bars and rods of non -alloy steel and were discharging duty liability under Section 3A of the Central Excise Act up to 31.3.2000; that with effect from 1.4.2000, duty liability was required to be discharged on ad valorem basis under Section 3 of the Act; that Notification No. 29/2000 (NT) provides that deemed credit equivalent to 12% of the value of the goods received as inputs as per the invoices would be allowed; that the Central Board of Excise and Customs has also, under Circular No. 522/2000 dated 31.3.2000, clarified that inputs lying in stock as on 31st March, 2000 would qualify for MODVAT Credit in the hands of the assessee on and from 1st April, 2000; that the Commissioner has also issued a Trade Notice No. 44/1 -MP/2000 dated 3.4.2000 to the said effect; that the Department has disallowed the Credit to them on the ground that the deemed credit is available only on the clearance of stock as on 1.4.2000 for use of the said stock in manufacture of finished goods and the benefit of Notification is not available on the inputs received prior to 1.4.2000 and that the Credit would be allowed to the extent of actual duty paid by the Assessee on the inputs which were lying in stock as opening balance on 1.4.2000; that the Department has thus restricted the Credit to the actual duty paid by the Appellants.

(3.) The learned Advocate, further, submitted that the impugned Orders nullify Notification No. 29/2000 -CE, (N.T.) which is totally impermissible; that the Authorities are bound to give effect to the Notification; that Notification does not distinguish between goods subjected to duty in the hands of manufacturer of Ingots @ Rs. 750 per M.T. on actual production and those who had opted to pay duty on compounding basis under Rule 96 ZO(3) of the Central Excise Rules, 1944.