R.C. GUPTA AND BROS. Vs. CCE

JUDGEMENT

(1.) The Appellants have filed two applications - one for extension of stay granted vide order No. S/343/94 dated 12/07/94 and the other for early hearing of this matter. I find that this appeal is of the year 1994 and though the stay had been granted on 12/07/94, the appeal could not be heard as due to various reasons this matter was not listed. Accordingly the early hearing application is allowed and the matter is taken up for final disposal. Since the matter has been taken up for final disposal, the application for extension of stay is dismissed.

(2.) The facts giving rise to this appeal, in brief, are that the appellant took Modvat credit in respect of inputs received during the period from 12/12/92 to 03/03/93, while Modvat declaration under Rule 57G of the Central Excise Rules was filed only on 05/03/93. The Department taking the view that in view of the provisions of Rule 57G filing of Modvat declaration was mandatory before receiving any inputs and taking Modvat credit, issued a show cause notice for disallowing Modvat credit amounting to Rs. 3,76,259/ - and imposition of penalty. The Assistant Commissioner vide order -in -original dated 04/01/94 confirmed the Cenvat credit demand of Rs. 3,76,259.94 against the appellant and imposed penalty of Rs. 5,000/ - on them under Rule 173Q. The Commissioner (Appeal) vide the impugned order -in -appeal dated 04/05/94 upheld the Assistant Commissioner's orders. It is against this order that the present appeal has been filed.

(3.) I have carefully considered the submissions from both the sides and perused the records. Finished products of the appellant as hardened and tampered steel strips and cold rolled strips. There is no dispute about the fact that the inputs were received during period from 12/12/93 to 03/3/93 while as per the records, the Modvat declaration was filed only on 05/3/93. From the Assistant Commissioner's order, I find that the receipt of inputs is not disputed. The only point of dispute is as to whether Modvat credit could be allowed even though the inputs had been received prior to the filing of Modvat declaration required under Rule 57G of the Central Excise Rules. On this issue, I find that Division Bench of the Tribunal in the case of Kerala State Electronics Development Corporation Ltd. v. CCE (supra) has held that Modvat credit is admissible even though inputs were received prior to filing of declaration under Rule 57G of the Central Excise Rules, 1944 and this judgment has been followed in the case of CCE, Mumbai - I v. Soni Soaps & Cosmetics Pvt. Ltd. (supra). The judgment cited by the learned Departmental Representative in the case of Punjab Paint Colour & Varnish Works Pvt. Ltd. v. CCE, Kanpur taking a contrary view on this issue is of Single Member Bench. In view of this, following the decision of the Division Bench, I hold that Modvat credit in respect of the inputs, in question, was admissible and as such, the Commissioner (Appeal)'s order upholding the denial of Modvat credit is not sustainable. The impugned order, therefore, is set aside. The appeal is allowed.