COMMISSIONER OF CENTRAL EXCISE Vs. KARTHIK STEELS LTD.

JUDGEMENT

(1.) THE respondents in this appeal of the Revenue had imported capital goods viz. 'wood pattern' and had availed Modvat credit of countervailing duty (CVD) paid thereon. In the relevant Bill of Entry, the item was classified under sub -heading 4413.00 of the Schedule to the Customs Tariff Act, corresponding to sub -heading 4409.00 of the Schedule to Central Excise Tariff Act. However, in the Modvat declaration filed by the as -sessee under Rule 57T of the Central Excise Rules, 1944, they classified the item under sub -heading 8480.00. Alleging that capital goods falling under heading 44.09 of the CETA Schedule were not covered by the definition of 'capital goods' under Rule 57Q, the department issued a show cause notice proposing to disallow the credit of CVD to the assessee. In the reply to the show cause notice, the assessee submitted that they had wrongly classified the goods under Heading 44.13 of the Schedule to the Customs Tariff Act. The original authority rejected this explanation and disallowed the credit under Rule 57U of the Central Excise Rules, 1944 and also imposed a penalty of Rs. 1,0007 - under Rule 173Q. The first appellate authority set aside the order of the lower authority and allowed the credit to the assessee. Hence this appeal of the Revenue.

(2.) NO representation for the respondents despite notice, nor any request of theirs for adjournment. After examining the records and hearing Id. SDR, we find that Id. Commissioner (Appeals) has rightly held the imported capital goods to be classifiable under Heading 84.80 of the CETA Schedule, which entry specifically includes moulding patterns. As rightly noted by the lower appellate authority, Chapter 44 specifically excludes goods covered under Section XVI wherein Chapter 84 falls. The capital goods falling Heading 84.80 were specifically covered under the definition of capital goods under Rule 57Q as the rule stood at the material time (August 1996). Hence there is no reason to interfere with the order passed by the lower appellate authority. The appeal is rejected, (Operative portion of the order was pronounced in open Court on 14 -9 -2005)