2012 (3) TMI 169

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....Rs.2,10,101/- on the inputs in terms of Notification No.58/97-CE, dtd. 30.08.97. The said credit was availed by the appellants on the strength of invoices issued by M/s Rathi Steels, Mandi Gobindgarh, supplier of inputs. M/s Rathi Steels was discharging their duty liability in terms of Section 3A of the Central Excise Act, 1944 read with Rule 96ZP(3) of the erstwhile Central Excise Rule, 1944 (scheme commonly known as Compounded Levy Scheme). Proceedings were initiated against the appellants proposing to deny them the said deemed Modvat credit on the ground that the supplier of the inputs, i.e., M/s Rathi Steels have not discharged their duty liability. The said proceedings resulted in confirmation of demand of duty of Rs.2,10,101/- and imp....

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....  S. No. Inovice No. 7 date Invoice Price (Rs.) Deemed credit (Rs.) Remarks on the invoice 1. 266 dt. 2.12.97 161280 19354 Duty liability discharged as per Rule 96 ZP(3) 2. 277 dt. 11.12.97 400002 48000 Duty liability discharged as per Rule 96 ZP(3) 3. 289 dt. 22.12.97 415040 49805 Duty liability to be discharged under Rule 96 ZP(3) 4. 292 dt. 23.12.97 162000 19440 Duty liability to be discharged under Rule 96 ZP(3) 5. 295 dt. 29.12.97 371840 44621 Duty liability to be discharged under Rule 96 ZP(3) 6. 307 dt. 21.01.98 240681 28881 Duty liability under Rule 96 ZP(3) under protest @ Rs.300 PMT  Ongoing through the relevant in....

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....in 2010(261)ELT951(Tri.Del.) and in the case of Commissioner vs. Mahajan Steel Tubes reported in 2007(219)ELT919(Tri.) has held that credit cannot be denied to the input receiver on the ground that the manufacturer of input has not paid appropriate duty. It stands further observed that the in case of dispute regarding payment of appropriate duty by the manufacturer, Revenue can proceed against manufacturer.   7. The said decision of the Tribunal stands confirmed by Hon ble Punjab & Haryana High Court as reported in 2009(238)ELT-A163(P&H).   8. The Tribunal in the case of CCE, Jalandhar vs. Jullundher Engineering Co. reported in 2010(261)ELT951(Tri.Del.) has held that supplier working under compounded levy scheme, issues invo....

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....e invoice. In as much as the inputs suppliers are working under the Compounded Levy Scheme, duty liability in respect of each and every clearance was not being determined and reflected in the invoices. That is why Notification allowing the deemed credit stands issued. As per the law, units working under the Compounded Levy Scheme are required to discharge their duty liability at the end of the month. As such admittedly the units clearing the inputs during the month, are not required to discharge their duty liability. Accordingly, invoices issued by them, when makes a declaration of payment of appropriate duty of excise in terms of para 4 of the Notification, has to necessarily refer to the duty payable at the end of the month. The fact that....