CCE Vs. HYUNDAI MOTORS (I) LTD.

JUDGEMENT

(1.) ALL the three appeals filed by the Revenue are arising out of a common Order -in -Appeal No. 33 to 35/2004 dated 24.06.2004, passed by the Commissioner (Appeals), therefore all are taken up together for disposal.

(2.) THE brief facts of the case are that the respondents M/s. Hyundai Motors India Ltd., are manufacturers of motor vehicles falling under Chapter 8703 availing Modvat Credit on inputs and capital goods under Rule 57(A) or 57Q of the Central Excise Rules, 1944. Dy. Commissioner of Central Excise Division, disallowed the total credit of Rs.71,11,402/ - (Rs. 6,06,916 + RS.20,49,883 + Rs. 44,54,604) and also imposed penalty under Rule 173Q, vide three Order -in -Original Nos. 65,66 & 68/2003 dated 27/8/03, 28/8/03 and 29/8/03 respectively. The respondents preferred appeal before the Commissioner (Appeals) and the Lower Appellate Authority vide O -in -A Nos. 33 to 35/2004 dated 24.06.2004 set aside all the three O -in -Os and allowed the appeals. Hence, the Revenue filed the present appeals.

(3.) THE Ld. AR of the Revenue reiterates the grounds of appeal and submits that the respondents have not received the inputs in their factory but were supplied directly to the job workers premises, they have availed modvat credit in their books of accounts without receipt of the goods and subsequently raised Modvat invoices/57F4 challans to the job workers. He submits that as per the Modvat provision, the primary conditions for availing credit is payment of duty on the inputs, receipt of the goods in the factory and usage of the inputs in the manufacture of final products. They have not fulfilled the mandatory procedural conditions stipulated in the Modvat provisions. He submits that non -observation of procedure is a substantial violation and therefore adjudicating authority had rightly disallowed the credit and imposed penalty. He relied on the decision of the Hon'ble Supreme Court in the case of CCE, New Delhi Vs. Hari Chand Shri Gopal ' : 2010 (260) ELT 3 (S.C.).