M/S. KASHIPUR SUGAR MILLS LTD. Vs. CCE

JUDGEMENT

(1.) THIS appeal is filed by M/s. Kashipur Sugar Mills Ltd. (hereafter referred to as appellants) against Order -in -Appeal 38/CE/MRT -II/09 dated 29.1.2009. M/s. D.S.M. Sugar, (Now Kashipur Sugar Mills) Ltd. Kashipur Distt. U.S. Nagar (hereafter referred to as the 'Appellants') are engaged in the manufacture of V.P. Sugar and Molasses, falling under Chapter Sub -Heading No. 1701.00 and 1703.00 of the Schedule to the Central Excise Tariff Act, 1985. The Appellants had availed Modvat Credit of Rs. 1,30,149/ - on the welding electrodes, under the erstwhile Rule 57Q of the Central Excise Rules 1944 prevailing at that time. A show cause notice was issued to the Appellants vide C. No. 20 -CE/Dem/R -II/KPR/97/243 dated 14.02.96 for recovery of the said amount under erstwhile Rule 57 -U of the Central Excise Rules 1944 as the goods i.e. welding electrodes did not qualify the definition of capital goods under the erstwhile Rule 57Q of the Central Excise Rules 1944. The said show cause notice was adjudicated vide order -in -original No. 58(94/97) Dem/DSm/99 dated 25.03.99. The adjudicating authority disallowed the total credit and ordered its recovery holding that the goods did not qualify the definition of capital goods under Rule 57Q of Central Excise Rules 1944. Aggrieved by the said order of the Asstt. Commissioner, the party filed an appeal with the Commissioner (Appeals) Customs & Central Excise, Meerut -II who vide his Order -in -Appeal No. 27 -CE/MRT -II/2003 dated 20.02.03 rejected their appeal. Being aggrieved with the order of the Commissioner (Appeals), the appellant filed an appeal with Hon'ble CESTAT. The Hon'ble CESTAT vide its final order No. 350/2006 -SM(BR) dated 21.02.06, remanded the case back to the original adjudicating authority for consideration of the appellant's claim under the erstwhile Rule 57D(2) of the Central Excise Rules 1944. The Assistant Commissioner, Central Excise Division Haldwani, vide O -I -O No. 39(14/07) Dem/DSM/2008 dated 29.03.08 held that the party is eligible for MODVAT Credit amounting to Rs. 1,30,149/ - under the erstwhile Rule 57D(2) of the Central Excise Rules 1944 and dropped the proceedings initiated by show cause notice.

(2.) REVENUE challenged Order -In -Original dated 29.03.08 before Commissioner (Appeals) who vide impugned order allowed the Revenue's appeal. Appellant have challenged the impugned Order in Appeal in the present appeal.

(3.) I find that CESTAT in earlier proceeding vide order No. 350/2006 -SM(BR) dated 21.02.06, has given the following directions to original authority.