2006 (2) TMI 345

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....he appellants were directed by the Superintendent of Central Excise, Range Lakhmipur - Kheri vide his letter dated 7-3-97 to reverse the Modvat credit availed on the said inputs as the same are inadmissible. The appellants also followed the directions of the Superintendent and reversed the Modvat credit availed on the said inputs, in installments from April, 1997 to November, 1997. The appellant, on their own. recredited the amount so reversed by them on 15-5-98. A show cause notice was issued to the appellants demanding the amount of recredit on the ground that the credit availed is on the goods received six months back. The appellants contested the show cause notice. The adjudicating authority confirmed the demand and also imposed equival....

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.... by both sides and perused records. I find from the records that the appellants have reversed the credit availed on the inputs - descalents on the direction of the Range Superintendent of Central Excise incharge of their factory. They have reversed ihe credit in installments from April, 1997 to November, 1997. It is to be noted that the appellants have reversed the credit in installments. Further, it is.surprising to note that the appellants, being one of the organized sector has reversed the Modvat credit on the mere letter of the Superintendent of Central Excise. They ought to have known that, during the relevant period, Modvat credit reversal, for any reason should be undertaken only if there is show cause and an adjudication to that eff....