CCE Vs. VENLON POLYESTER FILM LTD.

JUDGEMENT

(1.) THIS reference application is filed by Revenue against Tribunal's Final order No. 1543/99 dated 24.6.1999. By the said final order, the Tribunal ruled that the department had raised the dispute pertaining to D.G. sets being capital goods and as the matter was under dispute, question of its liability to pay duty did not arise. The matter was resolved by Order -in -Original No. 95/95 dated 19.5.1995 in terms of Rule 57T(1) of CE Rules. Appellants thereafter within a period of three months from the date of the order filed declaration on 21.8.1995 and within one month from the date of filing of the declaration had paid duty and had sought for taking modvat credit. It was noted that there was no dispute about the item being modvatable and the credit being granted. The question which was before the Tribunal was with regard to duty on which the declaration was required to be filed and taking of modvat credit. The Tribunal after due consideration held that the question of paying duty or filing declaration did not arise till the dispute pertaining to the item being capital goods or not was resolved by the department. Immediately after the said resolution of the dispute, the assessee had filed the declaration and completed the formalities. It was noted that proviso 3 to Rule 57T would apply and the assessee are required to file declaration and take credit within further period of two months, on sufficient cause being shown to the Assistant Commissioner to condone the delay in filing the declaration. It was noted that in the present case, the question of filing declaration did not arise at all. As the same was under dispute, therefore taking into consideration the view expressed by earlier Bench in Genset India (P) Ltd. v. CCE reported in 1998 (28) ELT 772, wherein also the dispute pertaining to diesel generating set being capital goods was in question, therefore the Tribunal allowed the assessee's claim. The reference application filed on a similar question was also rejected in Dalmia Industries Ltd. case reported in 1997 (91) ELT 71 : 1997 (61) ECR 239 (T).

(2.) REVENUE have contended that the Tribunal has not determined the question correctly in as much as the declaration was required to have been filed within the stipulated time limit in terms of provisions of Rule 57(2) of CER and in the present case declaration has been filed after a lapse of one year and hence the contravention is very clear and there is clear question of law arises for determination by High Court. Revenue has therefore prayed for referring the following two questions to High Court:

(3.) LD . DR Shri S. Kannan strongly urges the Bench for referring the matter to the High Court of Karnataka as the provisions of law is required to be interpreted in the matter and it is clearly failing within the ambit of question of law for reference to High Court.