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of <h1>Tribunal Upholds Appellants' Compliance with Central Excise Rules</h1> The Tribunal allowed the appeals, upholding the substantial compliance by the Appellants with the provisions of Rules 57G and 57H of the Central Excise ... Modvat Issues:The judgment involves the availing of Modvat credit on inputs under Rule 57G of Central Excise Rules, specifically regarding the receipt of inputs in the factory and transitional credit under Rule 57H.Availing Modvat Credit under Rule 57G:The Appellants, who manufacture ice-cream, filed for Modvat credit on inputs under Rule 57G. The Department raised concerns as the inputs for which credit was claimed were stored in godowns outside the factory. Show cause notices were issued for recovery of wrongly availed credits. The Assistant Commissioner initially dropped the demands after finding that the inputs had been transferred to the factory and utilized. However, the Commissioner (Appeals) reversed this decision, stating that credit can only be taken on inputs received in the factory. The Appellants argued that due to the imposition of excise duty on ice-cream, they stored inputs in godowns before bringing them to the factory. The Tribunal, considering the circumstances, agreed with the Assistant Commissioner's decision of substantial compliance with Rule 57G.Transitional Credit under Rule 57H:The Appellants also applied for transitional credit under Rule 57H for inputs lying in stock in their godown before filing the declaration. The Assistant Commissioner allowed this credit as well, but the Commissioner (Appeals) overturned this decision. The Tribunal, after examining the facts and the subsequent movement of inputs from godown to factory, agreed with the Assistant Commissioner's finding of substantial compliance with Rule 57H.Conclusion:In light of the circumstances and the relaxation granted by the Central Board of Excise and Customs in 1996 for storing inputs outside the factory premises, the Tribunal allowed the appeals, upholding the substantial compliance by the Appellants with the provisions of Rules 57G and 57H of the Central Excise Rules.
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