RAYMOND LTD. Vs. COMMISSIONER OF CENTRAL EXCISE

JUDGEMENT

(1.) The dispute in this case pertains to deemed credit. In a show -cause notice, the department sought to recover from the assessee Rs. 1,50,517/ - being the deemed credit availed by them in the month of April 2003. Interest was sought to be charged on the above amount under Section 11AB of the Central Excise Act and penalty was proposed to be imposed under Section 11AC of the Act. These proposals were contested. In adjudication of the dispute, the original authority confirmed the above demand against the assessee and imposed on them penalty of Rs. 10,000/ -. In an appeal filed by the party, the order of adjudication was upheld. Hence the present appeal of the assessee.

(2.) Examined the records and heard both sides. The appellants are engaged in the manufacture of textile fabrics in their composite null. They were entitled under Rule 9A of the CENVAT Credit Rules, 2002 co avail the benefit of deemed credit on the inputs lying in stock or in process or contained in finished products lying in stock as on 31.3.2003. For this benefit under Sub -rule (2) of Rule 9A, they were required to make a written declaration of the description, quantum and value of the stock of each of such goods. The method of calculation of the deemed credit of duty on each of such goods viz. inputs as such in stock, inputs under process, inputs contained in the finished goods in stock, as on 31.3.2003 was provided under Sub -rule (3). In respect of inputs lying as such in stock and inputs under process as on 31.3.2003, the method was available under Clause (a) of Sub -rule (3) and, in respect of inputs contained in the finished products in stock as on 31.3.2003, the method of calculation was provided under Clause (b) of Sub -rule (3). In this case, there is no dispute with regard to deemed credit availed by the appellants in respect of inputs contained in finished products in stock as on 31.3.2003 and therefore Clause (b) of Sub -rule (3) of Rule 9A is not relevant.

(3.) For the above purpose, the "deemed value" of the stock of goods in each category was calculated in terms of notification 35/03 CE NT dated 10.4.03 issued under Sub -rule (3) of Rule 9A of the CENVAT credit Rules, 2002 as follows :