PAUL STEELS (P) LTD. Vs. CCE

JUDGEMENT

(1.) THIS appeal is directed against the order -in -appeal dated 30.7.2005 which upholds the order -in -original wherein the Modvat Credit was disallowed and penalty was imposed on the appellants.

(2.) THE relevant facts that arise for consideration are that the appellants are manufacturers of non -alloy steel ingots and alloy steel ingots falling under Chapter 72. On introduction of Compounded Levy Scheme with effect from 1.9.97 the appellants opted for the same and started manufacturing the non -alloy Steel ingots and started paying duty as was ascertained by the competent authority. The appellants in the month of September, 1997 cleared alloy steel ingots @ 15% Advalorem and utilized the balance of amount of Modvat Credit in their RG23A Part II account for part duty liability and the balance duty liability was discharged by paying the same through PLA. A show cause notice was issued to the appellants to recover the Modvat Credit alleging, they could not utilize the Modvat credit once having opted for payment of duty under Compounded Levy Scheme and also sought imposition of penalty which was confirmed on adjudication. On an appeal the Commissioner (Appeals) also concurred with the adjudicating authority and upheld the order. Hence, this appeal.

(3.) LEARNED DR on the other hand submits that the provisions of Rule 57F(17) are very clear in as much that the appellant cannot use the Modvat credit once he has opted for the payment of duty under Compounded Levy Scheme. It is his submission that the appellant has violated the provisions and the order is correct.