AMBICA FASHION Vs. COMMISSIONER OF CENTRAL EXCISE, AHMEDABAD

JUDGEMENT

(1.) THIS appeal has been filed by the appellant against Order -in -Appeal No. 313/2006 (Ahd -I) dated 2 -1 -2007. Under the Order -in -Original No. 26/Ad. Commr/2006 dated 10 -5 -2006 a transitional credit of Rs. 20,55,276/ - under Notification No. 35/2003 -C.E. (N.T.) dated 10 -4 -2003 was disallowed to the appellant and a penalty of Rs. 10,000/ - was also imposed upon the appellant. During the course of personal hearing, held by Commissioner (Appeals) appellant was called upon to produce invoices under which credit was taken. Thereafter, a show cause notice was issued to the appellant on 16 -11 -2006 by Commissioner (Appeals) and under the impugned order -in -appeal dated 2 -1 -2007, Commissioner (Appeals) disallowed higher deemed Cenvat credit of Rs. 29,85,059/ - and enhanced the penalty from Rs. 10,000/ - to Rs. 10 Lakh.

(2.) SHRI Kuntal Parikh (Advocate) appearing on behalf of the appellant argued that appellant was entitled to the Cenvat credit as per Sr. No. 1(c) of the table annexed to Notification No. 35/2003 -C.E. (N.T.), dated 10 -4 -2003. His case is that Cenvat credit of Rs. 6,87,536/ - denied to the appellant with respect to second declaration filed on 26 -5 -2003 and denial of credit of Rs. 13,67,740/ -, by holding that credit to appellant is admissible as per Sr. No. 2 of table annexed to Notification No. 35/2003 -C.E., is not proper. It was also argued that issue of a show cause notice by Commissioner (Appeals) proposing denial of higher Cenvat credit and imposition of higher penalty is beyond the scope of the show cause notice and Section 35A(3) of the Central Excise Act, 1944. That by passing order in appeal dated 2 -1 -2007, Commissioner (Appeals) has exceeded his jurisdiction and the appeal filed by the appellant is required to be allowed on this ground alone.

(3.) SHRI K.J. Kinariwalla, (AR) appearing on behalf of the appellant reiterated the findings of the lower authorities and defended the Order -in -Appeal passed by Commissioner (Appeals).