2001 (10) TMI 798

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....te, submitted that the Appellants manufactured electric fans; that the Department had disallowed them the deemed Modvat credit in respect of Aluminium Scrap on the ground that the scrap was in form of old, used and broken parts of machinery which was clearly recognisable as non-duty paid; that in terms of the deemed credit Order issued by the Government of India, aluminium waste and scrap purchased from outside is deemed to have been duty paid; that as they have purchased the impugned scrap from the open market, it is deemed to be duty paid; that these are clearly stocks lying in the country not covered by the stocks lying in a factory, customs area or warehouse; that accordingly these inputs cannot be treated as being clearly recognisable ....

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....e 57G(2) must naturally say so, that is, take a definite stand and to the extent necessary produce documents and marshal arguments and logic to show that he is so entitled to the benefit of the Order. He should also take a definite stand that his case does not fall within the exception enumerated in the explanation to the Government Order. The second exception is where the inputs are recognisable as being non-duty paid or charged to nil rate of duty. In this regard also, the assessee has to take a stand and it is for the Revenue to satisfy itself that the exception is not attracted." These views were re-stated by the Larger Bench in the case of Indian Plastics Ltd. & Others v. C.C.E., 2000 (118) E.L.T. 268 wherein the present Appellant was ....

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....viding for the deemed credit and the various provisions subject to which the deemed credit was available. It was held that the intention was not to deem that inputs which actually did not suffer duty were inputs which suffered duty, and the purpose was to ensure the benefit to those who use inputs in the manufacture of which duty has acutally been paid but it might not be possible to produce duty paying documents which will unerringly connect the documents or duty payment with the particular inputs (refer Para 15 of the order). In Para 16 of the mischef sought to be avoided by the deemed proviso had been discussed. It was observed that mischief could not have been overcome by stipulating that credit is available even if duty has not been pa....