TaxTMI 
TaxTMI 
1995 (9) TMI 200
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....der her order dated 31-5-1991, the Collector of Central Excise (Appeals) had disposed of three appeals by a common order. As in all the three appeals common issues relating to the Modvat credit are involved, they were heard together and are being disposed of by this common order. 2. The appellant had received re-rollable material, defective steel ingots, blooms, cut ends, etc. (inputs), and used them in the manufacture of steel ingots and steel castings (final product), through the process of melting. In their declaration, the inputs were described as melting scrap. The inputs were not received directly from the manufacturers but were received under the cover of endorsed gate passes through third parties. In some cases, these third ....
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....c excise duty and Rs. 3,796.73 as special excise duty in Appeal No. 3185; Rs. 1,59,961.26 in Appeal No. 3186; Rs. 34,698.75 and Rs. 58,706.60 in Appeal No. 3187; and Rs. 20,706.46 in Appeal No. 3188. The Collector of Central Excise (Appeals) had rejected all the four appeals under her two separate orders. 3. The matter was posted for hearing on 14-7-1995 when Shri K.K. Anand, Advocate appeared for the appellant. Shri K.K. Dutta, JDR represented the respondent. 4. Shri K.K. Anand, the learned Advocate stated that the appellant were engaged in the manufacture of steel ingots for which they had a furnace. They were bringing scrap defective ingots etc., from outside after filing declaration wherein the inputs were shown as melti....
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....s not available on melting scrap. The learned JDR submitted that the appellant had committed a number of irregularities in taking the Modvat credit and have by misdeclaration and suppression, taken advantage of the credit which was not legally admissible to them. 6. We have carefully considered the matter. The appellant were engaged in the manufacture of steel ingots and steel castings (their final products) through the process of melting, for which they had an electric furnace. For the purposes of manufacture of their final products they brought different kinds of iron and steel - re-rollable material, slab/flat, end cuttings, bars, rods, angles, channels, etc. (their inputs), which they referred to in their declaration for the pur....
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....ctually being melted by them for the production of their final products. As they intended to melt the material which they purchased, they had described them as melting scrap, for which a proper declaration had been filed. They had also stated that all the inputs had been received by them under the cover of duty paying documents. When there were proper duty paying documents, the question of deemed credit would not arise and they were eligible for the credit of the duty as reflected in the duty paying documents. 9. We find that there is no allegation that the inputs were not received by the appellant, and only the endorsed documents without goods had moved from their suppliers. There is also no allegation that the inputs in whatever f....
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....text of the inputs used by the appellant, this description was general and somehow vague; on that account however, it could not be said that the credit with regard to the rolling/re-rollable material, steel ingots, etc. had been taken without declaration and without documents evidencing payment of duty or without permission/approval of the proper officer. The Asstt. Collector of Central Excise, Patiala under his communication dated 21-7-1986, had allowed the appellant to take credit under Modvat scheme on melting scrap. On this account, in the circumstances of this case, it does not appear appropriate to deny the credit. The documents showed the description as melting scrap, defective steel ingots/material cuttings, bloom cuttings, etc. The....
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....e Rules. The defence of the appellant is that "the credit on this account was taken on the belief that the permission if required would be obtained by the range authorities with whom complete data is regularly filed." In their reply to the show cause notice they requested that ex post facto permission in respect of the credit which has already been taken be granted, and that their reply may be treated as a request for the grant of permission. This reply is dated 1-12-1987 while they had already taken credit of Rs. 58,706.60 on 20-1-1987. The Asstt. Collector of Central Excise, Patiala, who adjudicated the matter had observed that as the party had not submitted the proof of payment of duty on the inputs lying in stock prior to 7-4-1986, the ....