HATHISING MFG. CO. LTD. Vs. UNION OF INDIA

JUDGEMENT

(1.) RULE . Mr. Jitendra Malkan, learned Assistant Solicitor General waives service of rule on behalf of respondent No. 1.

(2.) SINCE the issue involved in this petition is in very narrow compass, the matter is taken up for final hearing.

(3.) IT is the case of the petitioner that as the credit of duties paid on inputs used in relation to the manufacture of yams sold under exemption to Regd. Co -operative Societies in plain reel hanks would not be available, the petitioner company did not avail credit of duties paid on these quantities of fibres which were used in relation to yarns cleared under the above exemption and also maintained accounts of such transactions. A show cause notice was issued proposing to recover amount of Rs. 6,83,313/ - on the ground that the petitioner company has taken this amount as credit regarding duties paid fibers used in the manufacture of exempted yarns sold and supplied under Notification No. 26/94. The Assistant Collector of Central Excise passed an adjudication order on 23 -11 -1995 confirming the above demand with penalty of Rs. 50,000/ -.