(1.) THIS appeal has been directed by the appellants against the impugned order -in -appeal dated 15 -6 -2001 vide which the Commissioner (Appeals) has affirmed the Order -in -Original dated 28 -1 -2000 of the Addl. Commissioner who confirmed the duty demand of Rs. 3,65,624/ - with equal amount of penalty.
(2.) THE demand of Rs. 3,65,623/ - has been confirmed against the appellants by denying them the Modvat credit of that amount which they illegally availed before the installation and utilization of the capital goods for the manufacture of the final product i.e. Glazed Ceramic Tiles. The perusal of the impugned order shows that the appellants availed the Modvat credit during the period December 1997 to March 1998, whereas the machinery was installed thereafter, and even the registration certificate was got amended for production of the Glazed Ceramic Tiles only on 26 -12 -1998. The adjudicating authority accordingly disallowed the Modvat credit for having taken in contravention of Rule 57Q(7) and the Commissioner (Appeals) has affirmed that order.
(3.) THE learned counsel has contended that after the installation of the capital goods and utilization of those goods in the manufacture of the final product i.e. Glazed Ceramic Tiles, the appellants became entitled to the Modvat credit of the disputed amount, even if it is taken that initially they took it wrongly. According to the counsel, it is a case of revenue neutral and this aspect has not been gone into by the authorities below before disallowing the Modvat credit. The learned counsel has also contended that the impugned order deserves to be set aside and the matter should be sent back to the adjudicating authority for looking into this aspect of the matter.