LUPIN LABORATORIES LTD Vs. COMMISSIONER OF CENTRAL EXCISE

JUDGEMENT

(1.) IN the impugned order ld. Commissioner (Appeals) observed that the appellant got such capsules printed in their own name from M/s. Mittu Pharma, therefore, the consignments were enrouted from M/s. Universal Capsules to appellant factory via M/s. Mittu Pharma. Accordingly, the invoices on which credit has been taken were issued showing name of M/s. Mittu Pharma A/c M/s. Lupin Laboratory and held that there was a procedure for such movement of consignment subject for observance of Rule 57F(2) of the Central Excise Rules at the relevant time. The adjudicating authority and the appellant had agreed that such procedure was in existence during the relevant time but the adjudicating authority did not consider this on the ground that appellant did not only faild to follow the procedure but on the ground that the availment is in violation of the provision of the Modvat rule in so far as the goods are consigned directly to M/s. Mittu Pharma. In view of this, ld. Commissioner (Appeals) rejected the appeal of the assessee and reduced the penalty of Rs. 5/000/ -. Against this order, the appellants have filed this appeal.

(2.) FACTS of the case in brief are that appellant is manufacturer of P.& P Medicines falling under Chapter 30 and were availing facility of Modvat credit under Rule 57A. The appellants took credit of Modvat on the strength of invoices showing consignee of the goods as M/s. Mittu Pharma Ltd. A/c of Lupin Laboratories Ltd. The Department alleged that since the goods did not come directly to the premises of the appellant as in the documents on the strength of which Modvat credit has been taken by the appellants the goods were consigned to M/s. Mittu Pharma Ltd. and therefore, Modvat credit was not admissible. A SCN was issued to the appellants asking them to explain as to why Modvat credit should not be denied on the strength of invoices produced by them and why penalty should not be imposed. In defence, the appellants submitted that M/s. Universal Capsules Ltd. manufactured empty gelatin capsules; that these capsules were cleared by them on payment of duty that the goods were consigned to M/s. Mittu Pharma Ltd. for printing the name of the appellant that the printed empty capsules are then received by the appellant. It was submitted by them that the goods covered by the invoices were received in the factory of the appellants that there was no dispute about the duty paid character of inputs; their receipt and utilisation, that if at all there was some technical breach by not following Rule 57F(3), substantive benefit of taking credit of duty paid on empty gelatine capsules should not be denied to them.

(3.) AFTER careful consideration of the submissions; the Asstt. Commissioner denied Modvat credit and imposed a penalty of Rs. 10,000/ -. In appeal the ld. Commissioner(Appeals) held as indicated in the preceding paragraph.