1999 (12) TMI 446

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....under the Rule 57F (2) procedure. In the applications dated 28-6-1986, and 30-8-1986 for operating under this procedure, it had been made clear by them as part of the prescribed proforma that the raw materials were being supplied direct to the job worker, without their first being brought into the factory. In terms of this Rule, the processed material or semi-finished goods were to be brought into the factory of the original manufacturers from the job workers' factory. The Central Excise officers visited the factory when they found some quantity of final products was not entered in the RG 1 Register. This quantity was seized. In subsequent investigations it was found that the raw materials in the case of metal tower packings were directly s....

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....ken by way of suppression of material facts. 3. The second phase of the allegation was that the final goods were never received in the factory of the appellants but that they were cleared directly. The basis on which this allegation is made is the statement of Shri D.K. Patel, Jt. Manager of the appellant's factory. In one statement, Shri Patel had claimed that on receipt of the final products in the appellants factory at Baroda after ancilliary operation such as ribbing, punching, cutting & bending are got done from the job worker and thereafter, degreasing, inspection etc. were being done by the appellants. However on a later statement of 16-8-1990, he denied this claim. In this statement he claimed that the final products in some....

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....ct remains that duty was paid on these goods. Even if they did not enter the precincts of the factory physically, it is not the allegation of the department that the goods had not suffered duty or that the taking of the Modvat credit was wrong. 5. There are instances in other cases where the inputs were never received but credit was sought to be taken on documentation alone. It is not the situation in the present case. The receipt of the inputs is not doubted. The clearance of the final goods on payment of duty is also not doubted. The Modvat credit is sought to be reversed merely on the ground that the final goods did not enter the principal manufacturer's factory and did not leave from there. In my opinion this is a technical viol....