STAR PAPER MILLS LTD. Vs. CCE

JUDGEMENT

(1.) In the above captioned three appeals, which have been filed by the appellants against the common impugned order in appeal, the issue relates to the denial of Modvat credit to the appellants on Welding Electrodes. The Commissioner (Appeals) has denied the credit on these goods and confirmed the order in original. In case of Jaypee Rewa Plant Vs. CCE. Raipur - 2003 (57) RLT 739 (CEGAT -LB) the Larger Bench of the Tribunal has also taken the view that the Welding electrode and Gasses used in repair and maintenance of plant and machinery are not eligible inputs for modvat credit. Therefore, the impugned order passed by the Commissioner (Appeals) disallowing the Modvat credit is perfectly valid and does not suffer from any illegality and as such is upheld.

(2.) However, keeping in view the facts, circumstances and the issue involved, the penalty imposed on the appellants under Rule 1730 deserves to be set -aside a in the above said case, even the Larger Bench has also set aside the penalty in similar facts and circumstances.

(3.) The impugned order so far as it relates to the disallowance of Modvat credit to the appellants, is upheld, but, regarding the imposition of penalty, it is set aside. Appeals of the appellants accordingly stand disposed of.