RECRON SYNTHETICS LTD. Vs. CCE

JUDGEMENT

(1.) HEARD both sides.

(2.) THE appellant filed this appeal against order -in -appeal passed by the Commissioner (Appeals) whereby Modvat credit in respect of the capital goods was denied on the ground that the capital goods were sold to the finance company. Therefore, the appellants are not entitled to take credit in respect of the duty paid on the capital goods.

(3.) THE contention of the appellant is that the appellant after taking the credit on the capital goods sold the goods to the finance company, therefore, it amounts to removal of the goods. Hence they are liable to pay the duty on such removal of capital goods. The contention is that the goods were installed in the factory and thereafter they were sold to the finance company to recover the cost of the capital goods and the goods were taken on lease from the finance company. The contention of the appellant is that vide Notification No. 27/94 -CE(NT) dated 17.6.1994, the Revenue allowed the credit in respect of the capital goods which are on lease, hire -purchase or loan agreement from the finance company. The appellant relied upon the following decisions of the Tribunal viz.: