C.C.E. Vs. NIRANJAN SINGH KARTAR SINGH

JUDGEMENT

(1.) CAPTIONED 2 appeals have been filed by the Revenue against the order of the Collector (Appeals) who held that "I have considered the submissions made by the appellants in the memoranda of appeals and also the arguments tendered by the ld. Counsel at the time of personal hearing. The main point which required determination in these appeals is whether the appellants are entitled to avail Modvat credit of duty in excess of Rs. 500/ - per MT or Rs. 600/ - per MT as restricted by proviso to Notification No. 177/86, dated 1 -3 -1986 as amended on ship breaking scrap obtained by breaking up of ships, boats and other floating structures. It is observed that the appellants have availed Modvat credit of duty @ Rs. 600/ - per MT paid on goods under Heading No. 72.30 or 73.27 and obtained from breaking up of ships, boats and other floating structures imported into India on which the duty liability had not been discharged. As proviso to Notification No. 177/86, dated 1 -3 -1986 do not get attracted in these cases as the restrictions aforesaid apply to ship breaking scrap obtained by breaking up of ships, boats and other floating structures as are manufactured in India and not in the case of ship breaking scrap obtained by breaking up of ships, boats and other floating structures imported into India. The appellants have, therefore correctly availed Modvat credit of duty in excess of Rs. 500/ -."

(2.) THE facts of the case briefly stated are that the respondents are engaged in the manufacture and clearance of steel ingots. 1'hey are availing the facility of Modvat credit of duty paid on the inputs used in the manufacture of final products. The respondents claimed Modvat credit in excess of Rs. 500/ -per MT. They submitted that the scrap purchased by them was obtained by breaking up ships, boats and other floating structures imported into India. The Asstt. Collector rejected their contention and held that they were eligible to Modvat credit only to the extent of Rs. 500/ -PMT. The respondents herein filed an appeal before the Collector (A). The Collector (A) allowed their appeal.

(3.) SHRI S. Srivastava, ld. JDR submits that the respondents are covered by Notification No. 177/86 which restricted the quantum of credit to Rs. 500/ -. He submits that the respondents could not avail the credit in excess of Rs. 500/ -PMT. He reiterates the findings of the Asstt. Collector in the Order -in -Original.