AMRAPALI INDUSTRIES LIMITED Vs. COMMR. OF C. EX.

JUDGEMENT

(1.) M /s. Amrapali Industries Limited have filed the present appeals challenging confirmation of penalty against them by the Commissioner (Appeals), under the impugned Order.

(2.) SHRI Jitendra Singh, learned Advocate, submitted that the Appellants manufacture texturised yarn out of POY obtained on payment of duty; that they were availing Proforma Credit of duty paid on POY under Rule 56A of the Central Excise Rules, 1944; that for this purpose they had filed an application, dated 5 -4 -1994 and the necessary permission was granted by the Assistant Commissioner on 12 -4 -1994 for availing the Proforma Credit; that by Notification No. 24/94 -C.E., dated 20 -5 -1994 the credit scheme under Rule 57A was extended to POY and texturised yarn; that the Appellants availed Modvat Credit of duty paid on POY from 1 -4 -1995; that the Assistant Commissioner under Order -in -Original Nos. 66/98 and 67/98, dated 31 -12 -1998 imposed penalty on them on the ground that they had taken the Modvat Credit without filing declaration as required under Rule 57G of the Central Excise Rules; that the Commissioner (Appeals) also under the impugned Order has rejected their appeals. The learned Advocate, further, submitted that no penalty is imposable for a lapse which is purely procedural in nature; that the lapse of not filing the declaration under Rule 57G had occurred only because of their bona fide belief that permission for Proforma Credit having been granted, no further declaration was required to be filed; that they were filing RT 12 returns regularly and no objection was raised by the Department for taking Modvat Credit; that as such there was bona fide lapse on the part of both sides and as such no penalty can be imposed on them. He also mentioned that the scope of Proforma Credit and Modvat Credit is the same as there is difference in name only; that the irregularity was in respect of switching over from one scheme to another scheme; that it is because of this reason that no demand of the Modvat Credit availed of by them was ever made by the Department. He relied upon the decision in the case of Indian Rayon and Industries Limited v. CCE, Calcutta - 2002 (50) RLT 599 (CEGAT -Kol.) wherein it has been held that the credit is not deniable to the Appellants as extent of benefit under both the scheme, namely, Proforma Credit and Modvat Credit was same and only name differed.

(3.) COUNTERING the arguments, Shri U. Raja Ram, learned JDR, reiterated the findings as contained in both the Orders passed by the lower authorities.