TaxTMI 
TaxTMI 
1997 (12) TMI 366
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....rn the goods received by them after the job work to the principal supplier of the raw materials due to subsequent circumstances. 2. The ld. Original authority did not give the benefit of Modvat credit to the respondents while asking the supplier of raw material M/s. S and S Power Switch Gears Ltd., in the present case, to reverse the Modvat credit in respect of goods which were sent by them to the respondents. 3. Consequent on payment of duty on the inputs which were received by the respondents from M/s. S and S, the respondent took Modvat credit based on the certificate issued by the Inspector of the range concerned and which was subsequently backed-up by the certificate issued by the Superintendent concerned. The ld. Origi....
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....f clearance of the said goods to warrant a certificate under 57E. Instead, the assessee could have filed a refund claim on the duty paid erroneously on the processed goods received under 57F(2) procedure. Hence, I hold that the Duty Certificate under 57E produced by the assessee is not valid in this case for the purpose of allowing/taking Modvat credit and hence the credit taken is not in order." 4. The ld. Lower appellate authority, however, in his order in para 6 has held as under :- "Coming to the subject appeal, had the inputs been removed as such by M/s. S & S Switch Gears and was not expected to come back to the factory of S & S Switch Gears Limited, this would have been covered by Rule 57F(1). Because, it was expected that....
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....nt effected subsequent to the stage of clearance so long as the payment of duty is correctly authenticated." 5. The ld. JDR Shri Rama Rao for the department has pleaded that apart from the certificate being not by the competent authority initially, the respondents could not have availed of the Modvat credit as proviso to Rule 57E did not cover the contingency as in the present case. He has pleaded that the goods were originally received without payment of duty and no Modvat credit in respect of same was taken and it is on account of subsequent events that the duty in respect of the goods which were cleared under Section 57F(2) was required to be paid by reversal of the Modvat credit which was taken in respect of goods by the supplie....
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....not have been enlarged by the ld. Original authority as provisions of Rule 57E were not at all invoked in the show cause notice. In this connection, he referred to the Show Cause Notice. In the SCN, following has been set out:- "Whereas it appears that the assessees have taken credit on the strength of a document which is not a document prescribed under Rule 57G(2) inasmuch as the Certificate was not issued by the competent authority, is not in order and thereby contravened the provisions of Rule 57G(2) of Central Excise Rules, 1944. Therefore M/s. Towers and Structurals Private Limited are hereby called upon to Show Cause to the Assistant Collector of Central Excise, Madras X Division, No. 110, Nelson Manickam Road, Aminjikarai, Madr....
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.... authority has however dealt with the points which have been taken note of by the ld. Original authority other than those which were raised in the SCN. Even on this point, the respondents have a good case. 12. It is observed that this is a case where originally the inputs cleared from M/s. S & S were sent to the respondents for manufacture of goods on job work basis and M/s. S & S did not pay the duty or reverse the Modvat credit attributable to those inputs. However, subsequently, the provisions of Rule 57F(2) for removal of goods without payment of duty were not fulfilled and M/s. S & S paid the duty, as required under law, attributable to the inputs which were earlier cleared without payment of duty. The respondents were function....