PARABOLIC DRUGS LTD. Vs. CCE

JUDGEMENT

(1.) THREE show cause notices were issued to the appellants on the ground that they have availed modvat credit on certain inputs without filing declaration under Rule 57G of the Central Excise Rules, 1944. After considering the defence of the appellants, the original authority came to the conclusion that in respect of 7 inputs heading/sub -heading numbers under which the inputs have been received were at variation with those declared in the declaration. Three inputs namely HDPE drums, 6 Amino Penicillanic Acid and DMAC were declared on 21.10.98 i.e. much after taking of the credit and, he accordingly, disallowed the credit of Rs. 6,69,025.66 and imposed penalty of Rs. 25,000/ - on the appellants. The Commissioner (appeals) upheld the order of the original authority.

(2.) IT was pleaded for the appellants that they had filed declaration for the disputed products before taking the modvat credit. The description of the product which was received by them from the supplier of the inputs tallied with the declaration filed by them. Even the Chapter headings also tally but the difference is only in respect of sub -headings. Credit should not be denied to the appellants on the ground that sub -headings under which the inputs supplier has classified the goods are different from the sub -headings for which they have filed declaration. In respect of three items namely DMAC, 6 Amino Penicillanic Acid and HDPE drums declaration was filed on 21.12.98. After taking credit, they have applied for condonation of delay to the Assistant Commissioner under their letter dated 21.3.1999. However, no reply was given to them. They relied on the decision of this Tribunal in the following cases -

(3.) ON behalf of the Revenue, it was argued that they are not disputing in allowing the modvat credit in respect of the goods where description of the goods tally with the modvat declaration and the invoices, but there is only a difference in the subheading numbers of the classification done by the inputs suppliers and the classification shown in the declaration. In the case of two inputs, there is a difference in the Chapter number under which inputs supplier has classified the products and the declaration made by the inputs receiver i.e. appellants. These inputs are Pencillin G. Amidare Biocatalyst and Methylone Chloride. It was also argued that declaration filed by the appellants; on 21.12.98 was additional declaration and this will be applicable for the inputs which were received after that date. Therefore, the credit taken on the three inputs namely, DMAC, 6 Amino Penicillanic Acid and HDPE drums can only be available to the appellants after the date of filing of the declaration and not prior to that. Their application dated 21.3.1999 said to be for condonation of delay in filing the declaration was considered by the adjudicating authority in para 4.10 of his order and he has given the findings that application for condonation of delay was filed three months after filing declaration. A bare reading of which indicates that the declaration dated 21.12.98 has been filed as a supplementary declaration submitted in respect of additional inputs likely to be received and does not make any mention of the fact that these inputs have already been received and credit taken thereon. He, therefore, did not consider their letter dated 21.3.99 for condonation. It was, therefore, pleaded that the order of the lower authority is sustainable. Reliance was also placed on the decision of the Tribunal in the case of Paro Food Products v. Collector of Central Excise, reported in 1988 (38) ELT -332 where it was held that in interpreting the scope and ambit of Rule 57G(2), the Tribunal in a number of decisions has already taken the view that a manufacturer who has not filed a declaration under Rule 57G, will not be entitled to take credit of duty paid on the inputs received by him under the Modvat Scheme