TaxTMI 
TaxTMI 
2015 (5) TMI 1010
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....s been demanded. No penalty has been levied on this amount by the Commissioner. The period involved is from 1988 to 2004 in seven show cause notices. 2.1 Learned counsel for the appellant made the following submissions in respect of this demand : 2.2 The issue in this case is in respect of Modvat and Cenvat credits which were ordered to be reversed (paid back) on the only ground that the value of inputs lying in the factory were reduced for the relevant financial years, while preparing Annual Balance Sheets. In respect of some other inputs likewise lying in the factory, values were fully reduced (written off) on the basis that the said inputs were in the inventory for longer period belonging prior to 1-3-1986. According to t....
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....t on the following grounds : (i) The inputs were available in the factory, which is an admitted fact and there is no dispute in this regard. (ii) The values were reduced every year when physical inventory is taken in the context of preparation of Annual Balance Sheets. As per AS-2 prescribed by the Institute of Chartered Accountants of India and in consonance with the provisions in Section 211(3B) of the Companies Act, the values are to be reduced in that manner. It does not mean that the goods as such lost their full value. (iii) There were no such inputs in stock where the values were completely written off. Only values were reduced; they were not wholl....
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.... of Excise Act and the rules. (viii) Significantly and understandably the Commissioner held that no penal provisions like Section 11AC or any other provisions are attracted. He dropped the mandatory penalties proposed. He also held no penalties are leviable under the erstwhile Rule 173Q. (ix) Even otherwise, prior to 11-5-2007 even if the value is fully written off, the credit is not recoverable as explained infra. (x) On 11-5-2007, Rule 5B to Cenvat Rules was inserted by Notification No. 26/2007-C.E. (N.T.), dated 11-5-2007 to the effect that in cases where the value is fully written off the credit should be reversed and the reversed credit can be (however) taken back if the go....
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....ounts than RG 1 Register" were not accounted. It was submitted that confirmation was made by looking into only one RG 1 register but the appellants have two units and two RG 1 registers. One was Personal Computers Division (PCD) and other was Computer Manufacturing Group (CMG). It was submitted that officers did not look into RG 1 register maintained by CMG. Learned counsel however could not explain as to why there was an observation about excess recording in the Annual Balance Sheet and why no reconciliation statement was submitted and copy of the relevant registers were also not provided. Even though it is more than 16 years and even now, the appellant did not have all the details. Therefore we are not able to consider the submission in f....