C.C.E., JAIPUR Vs. MANGALAM CEMENT LTD.

JUDGEMENT

(1.) The respondents manufacture "Cement and Clinker" classifiable under Chapter 25 of the Schedule to the Central Excise Tariff Act, 1985. During the month of December, 1994 to February, 1995, the respondents inter alia availed modvat credit amounting to Rs. 17,847/ - on the items "Refractory Bricks and Three Phase - 4 wire KWH Electric Meter" as capital goods under Rule 57 -Q of Central Excise Rules, 1944. The Asst. Commissioner of Central Excise, Kota, vide his Order dt. 22.12.95 denied them the modvat credit on these items and further imposed a penalty of Rs. 5,000/ - on them.

(2.) On appeal filed by the party, the Commissioner (Appeals), Jaipur vide his Order dt. 11.9.2000 allowed them the modvat credit on the above items but he made no observation with regard to the penalty imposed on them by the lower appellate authority.

(3.) The present appeal is filed by the Revenue against the above order of Commissioner (Appeals). The respondents have filed a cross objection with regard to the amount of penalty imposed on them. I have considered the submissions made by Shri S. Kumar, JDR for the Revenue and Shri Pankaj Mullick, C.A. for the respondents. I have considered the submissions made before me. It is observed that issue relating to the modvat credit on the capital goods under Rule 57 -Q now stands amply clarified vide the Larger Bench decision of the CEGAT in the case of C.C.E., Indore vs. Surya Roshni Ltd. reported in 2001 (128) ELT 293 (Tri. LB). This subject matter was further dealt in extenso by the Hon'ble Madras High Court in their judgement in the case of SIV Industries Ltd. vs. C.C.E., Coimbatore reported in 2001 (129) ELT 48 (Mad.). In view of these facts, it is felt necessary to remand the matter to the Original Authority for considering availability of the modvat credit on the two items under consideration as "capital goods" in the light of the above said decision. Accordingly, the order passed by the lower appellate authority is set aside and the matter remanded to the Original Authority for de -novo consideration in the above terms. The assessee shall be afforded a reasonable opportunity of hearing before taking a final view in the matter.