1998 (6) TMI 171

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....ng for the Applicant, submits that the Applicants are engaged in the manufacture of, inter alia, coated cotton fabrics; that one of the raw materials used in the manufacture of the fabric is yarn; that the applicants purchased the yarn from several suppliers; that they filed declarations under Rule 57G declaring the yarn as raw materials, the grey fabric as intermediate product and the coated fabric as the final product; that the Applicants sent the yarn for conversion into fabric to several job workers; that the applicants received the yarn in their factory, took credit of duty paid on the yarn, sent the yarn to Job Workers under the cover of Rule 57F(3) Challan after due intimation to the Department; that the Applicants received the fabri....

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....ule 57F, the non-filing of the undertaking in terms of Notification No. 214/86 cannot come in the way of the Applicant availing credit of duty paid on the yarn; that it is always the option of the Assessee either to operate under Rule 57F or under Rule 57J; that this contention is supported by the decision of the Hon'ble Bombay High Court in the case of Impact Containers Private Ltd. v. Asst. Collector of C.E. [1996 (85) E.L.T. 213]; that in any case the entire exercise is a revenue neutral exercise; that in so far as the second stage job worker is concerned, the Applicants had filed an undertaking under Notification No. 214/86 and thus the requirement of Rule 57J was satisfied; that since the requirement was satisfied, the Applicant was en....

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....ll have to be allowed Modvat credit at the processed fabric stage and thus, even this non-filing of the undertaking is revenue neutral. The ld. Counsel, therefore, submitted that on merits they have a strong prima facie case in their favour and, therefore, prayed that pre-deposit of duty and penalty may be waived. 6. The ld. Counsel also submitted that even on limitation they have a case in as much as there was no suppression and, therefore, longer period beyond six months cannot be invoked as the entire case is made out on the statutory documents available and maintained by applicants. 7. Summing up his arguments, the ld. Counsel submitted that they have a strong case both on merits and limitation. 8. Opposing the r....