UNITED METAL INDUSTRIES Vs. CCE

JUDGEMENT

(1.) HEARD both sides. As it is possible to hear and decide the case itself today the requirement of predeposit is waived and the appeal is taken up for decision.

(2.) IN this case the appellants took input duty credit in respect of the inputs used in the manufacture of the impugned goods on job work basis which was sent without payment of duty to the principal manufacturer who in turn cleared the same on payment of duty. At the instance of the Department the appellants initially reversed the credit but subsequently took suo moto credit of the same coming to know that in such a case the credit is admissible as held by the larger Bench in the case of Sterlite Industries (I) Ltd. v. CCE, Pune : 2005 (183) ELT 353 (Tri. - LB). The Department took objection to the suo moto taking of the credit and the present proceeding was initiated. In the meantime another larger Bench of the Tribunal in the case of BDH Industries Ltd. v. CCE, 2008 TIOL 1211 CESTAT MUM LB has held that there is no provision in the Central Excise Act and Rules permitting taking credit suo moto and that filing of a refund claim under Section 11B is necessitated. Citing this order the lower appellate authority has confirmed the demand as well as ordered for paying the interest and penalty.

(3.) MS . Indira Sisupal, JDR appearing for the Department states (sic) on instruction from the jurisdictional Commissioner that the refund claim has been allowed by the original authority but an appeal by the Department has been filed before the first appellate authority.