HINDUSTAN ZINC. LTD. Vs. COMMISSIONER OF CENTRAL EXCISE

JUDGEMENT

(1.) This is an appeal filed by M/s. Hindustan Zinc Limited, Visakhapatnam against Order -in -Appeal No. 3/2003(V -I) -CE dated 18.2.2003 passed by the Commissioner of Central Excise (Appeals), Visakhapatnam.

(2.) The appellants are manufacturer of Zinc and Lead in their smelters situated at Visakhapatnam. They received certain chemicals from their own mines at Rajasthan, on payment of duty under TR -6 challan. They had taken credit of the duty paid on TR -6 challans. However, a Show Cause Notice was issued to them for rejection of the credit taken. The Assistant Commissioner confirmed the demand by rejecting the modvat credit taken on TR -6 challans. On appeal, the Commissioner (Appeals) also rejected their appeal and upheld the order of the Assistant Commissioner.

(3.) In the appeal petition, it is pleaded that modvat credit is allowed only on the prescribed duty paid documents, but in the instant case, no duty paying document could be made by the supplier because the unit is only a 'mine' which is not registered with Central Excise Department. The Superintendent of Central Excise incharge of the 'mine' from which the despatch took place, advised payment of Excise Duty on TR -6 challans and in the absence of any system by which a different procedure could be followed, claiming of modvat on the strength of TR -6 challans is perfectly in order. In the case of Goods Transport Association v. CCE, the Mumbai High Court had held that proof of payment of duty is the basic criteria for allowing modvat credit and any other procedural omission can be ignored. They relied on the decision of CEGAT in the case of Gabriel India v. CCE, 1993 (67) ELT 131 wherein identical issue was considered and a view was taken that the appellants are entitled for taking credit on the strength of a TR -6 challan.