1995 (3) TMI 253 - AT - Central Excise

Appeal allowed due to lack of clarity in Modvat Scheme

The appeal was allowed as the tribunal found that the lack of clarity in the Modvat Scheme at the time of declaration justified the non-declaration of ... Demand - Modvat credit The appeal was against Order-in-Original No. 17/90, dated 30-3-1990 of the Additional Collector of Central Excise, Nagpur. The appellants, engaged in manufacturing steel castings, filed a declaration under the Modvat Scheme for Ferro Silicon manganese but used silicon manganese as input without mentioning it. The department issued a show cause notice for recovery of credit. The tribunal found the objection valid but noted the lack of clarity in the Modvat Scheme at the time of declaration. As the item was eligible for Modvat credit and non-declaration was due to ignorance, the extended period for demand was not valid. Since no mala fide motive was found, the penalty for non-declaration was not justified. The appeal was allowed.