MARUTI UDYOG LTD. Vs. CCE

JUDGEMENT

(1.) THE appellant is a leading manufacturer of cars in India. For use in the said manufacture, it receives a wide variety of components and materials from a large number of suppliers. It is entitled to, and avails of modvat credit on the said inputs.

(2.) PERIODIC stock taking of inputs is carried out by the appellant as a part of management control. These stock verifications bring out both shortages and excesses. Stock verifications for the financial years 1996 -97 to 1999 -2000 showed certain shortages. Credit attributable to the inputs found short was about Rs. 17 lakhs. The appellant debited the said credit in its Modvat account. Though there were excesses also, no claim for additional credit was made in regard to those excesses.

(3.) A show cause notice dated 28th June 2001 was issued, alleging that the delay in returning the credit on inputs found short attracted penalty under Section 11AC of the Central Excise Act 1944. It was also alleged that the appellant was liable to pay interest under Section 11AB. These allegations were confirmed in adjudication and the appellant filed an appeal before Commissioner (Appeals).