HINDUSTAN COCA-COLA BEVERAGES P. LTD. Vs. CCE

JUDGEMENT

(1.) After hearing both the sides on the application for waiver of predeposit of duty of Rs. 77,47,000/ - and penalty of Rs. 10 lakhs, we find that it is possible to hear and decide the appeal itself at this stage and hence proceed to do so with the consent of both sides.

(2.) The issue in dispute is the availability of modvat credit to the appellants as credit has been denied on various items such as bottling line, UPS system, lubricating systems for conveyors, etc. The grounds for denial of credit as seen from the impugned order are varied, e.g. credit on UPS accessories has been denied on the ground that it is excluded under Rule 57Q; Credit on bottling line has been denied on the ground that it is excluded under Rule 57Q; Credit on Glycol falling under Heading 2905.90 has been denied on the ground that the Heading itself stands excluded from the coverage of Rule 57Q. It is explained that all the above items are covered by the description of capital goods e.g. UPS accessories have been found to be parts of conveyor system and, therefore, credit is admissible under clause 5 of Rule 57Q which covers components/accessories of goods specified against Sl.No.l to 4 of the table and there is no dispute that the item in question is an accessory/part of an item specified in one of the Headings at Sl. No. 1 to 4 of the Table to the Rule. In one portion of the order of the Commissioner (Appeals) has allowed credit on bottling line and in the other portion of the order, the Commissioner (Appeals) has denied credit. The Learned Counsel also submits that the appellants are entitled to credit on lubricating system for conveyers. He, therefore, submits that the predeposit requirement may be waived. However, on hearing the learned SDR, we find that all these aspects will require to be considered by the Commissioner before whom the appellants, inspire of number of opportunities granted, had not appeared for hearing. In the interests of justice and in order to enable the Commissioner (Appeals) to arrive at a conclusion regarding availability of modvat credit, we set aside the impugned order and remand the case to the Commissioner (Appeals) for fresh decision on the availability of credit on the disputed items. He should pass fresh orders after extending an opportunity of hearing to the appellants for substantiating the claim for credit.