FLEX INDUSTRIES LTD. Vs. UNION OF INDIA (UOI)

JUDGEMENT

(1.) In the present petition the petitioner seeks the following reliefs

(2.) The brief facts giving rise to the present petition are that the petitioner is engaged in the manufacture of Plastic Films, Flexible Plastic Packaging Material and Gravure Printing Cylinders falling under Chapters 39 and 84 of the Central Excise 'Tariff Act, 1985. The manufactured commodity is liable to Central Excise Duty. The petitioner was also entitled for Modvat credit on the inputs and capital goods used in the manufacturing of final products in accordance to the rules. The petitioner has claimed Modvat credit on High Speed Diesel Oil (hereinafter referred to as 'HSD oil') falling under Chapter 27 of the Central Excise Tariff Act, 1985 from March, 1997, after the insertion of Rule 57B with effect from 1-3-1997. The Modvat Credit has been availed on the ground that HSD oil was being used for generation of electricity or steam, used for the manufacture of final products, within the factory premises. The petitioner was served with the show-cause notices for the period from March, 1997 to June, 1998 on the ground that the Modvat credit on HSD oil was wrongly availed as it was not legally available as per Notification No. 5/94(N.T.) dated 1-3-1994, as amended from time to time. The petitioner filed reply to the show-cause notices. In the reply it was contended that the petitioner was entitled to avail Modvat credit under Rule 57B, which has extended the Modvat credit facility to those inputs which were not covered under Rule 57A and the notification issued thereunder.

(3.) The adjudicating authority has not accepted the plea of the petitioner and has confirmed the demand. It has been held that the Modvat credit on HSD oil was not available to the petitioner.