2001 (9) TMI 356

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....Modvat credits of Rs. 12,64,912/- and Rs. 4,88,636/- imposed penalty of Rs. 1,25,000/- and Rs. 50,000/- on them. 2. The facts leading to the filing of the present appeal may briefly be stated as under : 3. The appellants were engaged in the manufacture of MS Black Pipes and MS Galvanised Pipes. They availed Modvat credit on the purchased MS pipes and galvanised pipes under Rule 57A of the Rules. They were served with two show cause notices vide which they were called upon to show cause as to why the amount of Modvat credit of Rs. 12,64,912/- and Rs. 4,88,636/- be not recovered from them and penalty be also not imposed on them on the ground that they were not entitled to avail the same legally. In defence, to those show cause....

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....and 13 of the Central Excise Rules and further argued that the appellants had been illegally denied Modvat credit. 8. On the other hand, learned SDR has reiterated the correctness of the impugned order and contended that the appellants are not entitled to claim Modvat credit on the MS pipes and MS galvanised pipes under Rule 57A or Rules 12 and 13 of the Rules as the same were not used by them as inputs in or in relation to the manufacture of the final products. 9. The facts are not much in dispute. The appellants purchased MS pipes and MS galvanised pipes from market and subsequently cleared the same from the factory premises without being subjected to any process of manufacture as defined under Section 2(f) of the Act. Eve....