COMMISSIONER OF CENTRAL EXICSE, Vs. BOC

JUDGEMENT

(1.) In this appeal filed by the Revenue the controversy centres round the question as to whether the modvat credit was permissible to the respondents on liquid nitrogen/organ gases lost due to evaporation during the manufacturing process of the final products or not.

(2.) The appellants are engaged in the manufacture of oxygen gas dissolved acetylene etc. They claimed modvat credit on the inputs -liquid nitrogen/organ gases which were lost due to evaporation during the manufacturing process of Rs.1,28,323/ - during the period December 1993 to May and of Rs.51,772/ - July 1994. They were accordingly issued two show cause notices vide which they were directed to reverse these credits as the same were not available to them under Rule 57 -D of the Central Excise Rules. The Assistant Commissioner confirmed the demand of those show cause notices after getting the reply from the respondents through order in original and that order had been reversed by the Commissioner (Appeals) through the impugned order.

(3.) It has been fairly conceded by the learned JDR that issue regarding entitlement of modvat credit on the quantity of nitrogen / organ gases lost due to evaporation during the process of manufacture of the final products already stands decided by the Tribunal in the respondents' own earlier case, in their favour. The learned counsel for the respondents has produced copy of that Final Order No.A/762/99 -NB(S) dated 12.8.99 vide which it had been ruled that the modvat credit was admissible on the quantity of nitrogen/ organ gases lost due to evaporation during the process of manufacture of the final product, to the respondents The Tribunal took this view by relying on the ratio of the law laid down by the Allahabad High Court in the case of Varuna Sulphonators Pvt. Ltd. Vs. Union of India and Ors. 1994(50) ECR 164 and alto by the Apex Court in Swadeshi Polytex Ltd. Vs.CCE 1992 SCC 358.