2001 (11) TMI 799

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.... product manufactured by them, nor maintained any records to show that, the credit of duty availed on inputs has been utilized for payment of duty on those final products only for which they were intended as per declaration filed under Rule 57G. 2. The appellants were alleged in the show cause notice, to have suppressed the facts by not producing the statement of input credit availed, for manufacture of each final product which is in contravention of Rule 57(1)(i) and (4) of Central Excise Rules, 1944 and credit so availed is recoverable under proviso to sub-rule (1)(i) of Rule 57-I of Central Excise Rules, 1944. Penal action under Rule 173Q(1) a(bb) and (d), read with Rule 210 ibid was also proposed. 3. The adjudicating aut....

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.... authority that, one to one co-relation for availing Modvat is not necessary and Modvat credit is not deniable on this aspect. In the following situation Modvat credits cannot be denied viz : (a)    The Modvat credit in respect of any input can be utilized on payment of duty on any of the final products in manufacture for which the input is indicated to be used. Reliance placed in case of M/s. Rama Cables and Wire Ltd. reported in 1993 (68) E.L.T. 256 (T), and M/s. Sawottam Ispat Pvt. Ltd. reported in 1989 (41) E.L.T. 181 (T). (b)    Modvat credit is also not deniable where common inputs have been utilized in manufacture of several final product. Reliance in case of M/s. Ideal Electronic reported in 1997 ....

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.... by S/Shri J.R. Cama, Advocate and K.B.R. Swamy who reiterated the submissions and also brought to the notice the contrary facts with respect to order-in-original. 7. I have carefully gone through the case records, the show cause notice the submission made in appeal and impugned order-in-original. 8. The primary issue before me is regarding use of the Modvat credit for payment of duty on final product in the manufacture of which the said inputs allegedly had not been actually used. 9. It can be inferred that, the department insisted for one to one co-relation as in the show cause notice it alleged that the appellant neither submitted a statement indicating the input credit availed and utilized in respect of each fina....

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....raised by the department in instant case, that is, regarding one to one co-relation. The said ruling settled the issue stating that, - "The rule provided inter alia that credit of duty could be utilized towards payment of duty on the final product in or in relation to the manufacture of the final product, which are intended to be used in sub-rule (1) of Rule 57G. The terms inputs and final product have been defined in Rule 57G, as the excisable goods used in or in relation to the manufacture of the final product and as finished excisable goods respectively. Therefore, so long as the duty paid on any of the goods used in or in relation to the manufacture of final product used in payment of duty in the excisable goods there is compliance o....