VIKAS PIPE Vs. COMMISSIONER OF C. EX.

JUDGEMENT

(1.) WE have heard the learned Counsel for the parties. Since the matter herein already stands decided in favour of the assessee and against the Department in CEC 173 of 2002, it will not serve any useful purpose in remitting the case back to the Tribunal with a direction to refer the question of law which according to us arises from the order of the Tribunal. The question which arises from the order of Tribunal already stands answered by this Court in favour of assessee in the aforesaid case. The question of law which arises in the case is whether the Tribunal was right in holding that the benefit of Modvat credit could not be granted to the assessee on the ground that supplier of inputs had failed to pay excise duty when the assessee was entitled to the said credit in terms of Notification No. 58/97.

(2.) BRIEF facts giving rise to this petition can be noticed. M/s. Vikas Pipes, Dirba is engaged in the manufacture of pipes and tubes falling under subheading 7306.90 of Central Excise Tariff Act, 1985. It is purchasing the inputs from M/s. Rathi Steels, Amloh Road, Mandi Gobindgarh (for short suppliers). The suppliers are engaged in the manufacturing of flat bars and are working under Compound Levy Scheme under Section 3A of the Central Excise Act, 1944. When the inputs were purchased by M/s. Vikas Pipes, the supplier issued the invoices certifying therein that it had discharged its liability in regard to the payment of excise duty. When the invoices were sent for verification, it transpired that the supplier had not discharged the due liability fixed under Section 3A of the aforesaid Act. In this view of the matter, the adjudicating authority disallowed deemed Modvat credit amounting to Rs. 1,73/669/ - to the assessee. That order was upheld by the Commissioner in appeal. Same view was taken by the Tribunal holding that since the assessee had failed to produce any evidence to show that the suppliers had discharged their due liability, the assessee was not entitled to deemed Modvat credit. It is against this order of the Tribunal that the assessee had filed the present petition under Section 35H(1) of Central Excise Act, 1944, seeking a mandamus directing the Tribunal to prepare the statement of the case and refer the aforesaid question of law to this Court for its opinion. As already observed, this question stands answered in favour of the assessee and against the Department by order dated 20 -1 -2003, passed in CEC 173 of 2002, wherein this Court held as under : -