COMMISSIONER OF CENTRAL EXCISE Vs. TELCO

JUDGEMENT

(1.) HEARD both sides. This is appeal filed by the Revenue. The Revenue has taken the following grounds in their Memorandum of Appeal. 6. The earlier O.I.A. No. PI/221/2000 dated 31.1.2000 (Appeal No. E/901 -01(Mum) and O.I.A. No. PI/71/2002 dated 7.2.2002 and OIA No. PI12/2003 dated 28.1.03 of Bajaj Auto Limited on the same issue, which have been appealed against are still pending in CEGAT. 7. The legislature has in clear words set out under Rule 57S(1)(ii) that the capital goods in respect of which MODVAT Credit has been taken could be cleared from the factory for home consumption by treating them as having been manufactured in the said factory. The words used leave no (sic) for doubt as to what the legislature intended in the matter of recovery of duty on capital goods which are cleared as such for home consumption from the factory. In the instant case the assessee has cleared the capital goods by paying duty only to the extent of modvat credit availed. 8. The Hon'ble Tribunal in the case of CCE v. Chandigarh Bottling Co. has held that the rate of duty payable on removal of inputs is as prevalent at the time of removal as if such inputs were manufactured in the factory n terms of Rule 57F(1)(ii) of the Central Excise Rules, 1944, and not equal to the amount which was paid by the supplier of the inputs (who were enjoying benefit of concessional rate of duty as an SSI Unit). The facts of the present case are similar to the facts in the case of Chandigarh Bottling Company. 9. The reliance placed by the Commissioner (Appeals) on the case law M/s. Asia Brown Boveri 2000 (39) RLT 575 (CEGAT -LB) appears to be misplaced. In that case, the Hon'ble tribunal had dealt with the provisions of Rule 57F(1) as it stood after an amendment by Notification No. 28/95 -CE (NT) dt. 29.6.1995. By this amendment the words, 'as if such inputs have been manufactured in the factory' were omitted and the proviso also was substituted. Paragraphs (8) and (9) of the above judgment reflects the position. 10. While the provisions of Rule 57F were amended in 1995, the provisions of Rule 57S remained untouched. Rule 57S(1): The capital goods in respect of which credit of specified duty has been allowed under Rule 57Q may be (i) - - - (ii) removed after intimating the Assistant Commissioner of Central Excise, having jurisdiction over the factory and after obtaining dated acknowledgement of the same, from the factory for home consumption or for export, on payment of appropriate duty of excise leviable thereon or for export under bond, as if such capital goods have been manufactured in the said factory.

(2.) IN view of the grounds taken by the Revenue in their Memorandum of Appeal, I consider it necessary to remand the matter to the Commissioner (Appeals) for fresh adjudication and pass a speaking order after giving a reasonable opportunity of hearing and after taking into consideration the above grounds made by the Revenue.