2002 (12) TMI 515

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....al, SDR, for the Respondent. [Order per : Justice K.K. Usha, President]. - Challenge at the instance of the assessee in this appeal is against the order passed by the Commissioner of Central Excise dated 11-12-2001. The issue that has to be considered is whether the appellant is entitled to benefit of deemed credit. 2. The appellants are engaged in the manufacture of coated fabrics known ....

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....ixed by the Commissioner on 20/21-1-99. On 26-4-99 the final capacity was also determined and fixed, the appellants were, therefore, paying duty from 13-1-99 onwards under the Compounded Levy Scheme under Section 3A. Later the appellants vide letter dated 14-6-99 informed the department that since they are independent processors the duty liability has to be discharged by them only under Section 3 ....

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....o Section 11A of the Central Excise Act. According to the show cause notice the appellants had wilfully suppressed the vital facts with intention to evade payment of appropriate duty leviable on such goods manufactured and cleared from its factory w.e.f. 13-1-99 and therefore, they are not entitled for deemed credit. It was the case of the department that the amending Notification No. 2/99, dated ....

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....rocessor. The department was not inclined to accept the above position. It was under these circumstances the appellants were registered under Section 3A. Thereafter, it was again on the initiative of the appellants in June, 1998 the department permitted them to come under Section 3 in July, 1999. The letter dated 24-8-98 would clearly show that the department was informed about their making knitte....