GERMAN REMEDIES LTD. Vs. CCE

JUDGEMENT

(1.) THE appellant is a manufacturer of medicines, which are liable to central excise duty. The present appeal challenges denial of Modvat Credit in respect of certain imported inputs. When the inputs were initially cleared no customs duty was paid since the imports were under DEC Scheme. Subsequently duty, including additional duty of customs CVD, was paid on account of failure to carry out exports. Thereupon the appellant claimed credit of CVD based on the customs receipt. The impugned order rejected the claim on the ground that the relevant provision, namely Rule 7(1)(b) and Explanation to that Rule covered only taking of additional amount of credit in cases "where some additional duty has been paid initially and subsequently further payment of additional duty has been made". The order has observed as under:

(2.) IT is the contention of the appellants that the view taken by the Commissioner is erroneous. They have submitted that Rule 7 of the Cenvat Rules mentions the documents which are valid for taking of Modvat Credit. Sub -rule (a) of this rule relates to documents issued at the time of excise or customs clearance of goods or sale of goods by dealers. Sub -rule (b) relates to supplementary documents like inovice issued in evidence of payment of "additional amount" of excise duties or additional duties of customs. These supplementary documents were valid for taking of "additional credit" irrespective of whether the additional amount of duty paid was full or part.

(3.) WE are in agreement with the interpretation placed by the appellant. Sub -rule (b) and Explanation there to reads as under: -