2004 (5) TMI 202

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....ment of Modvat credit. The period in dispute is April 1992 - March 1993. 2. Briefly the facts are that the appellant is a manufacturer of varnishes and thinners. The appellant was working under Modvat scheme but opted out of it on 1-4-1993 in order to avail of the SSI exemption under Notification 1/93-C.E. He reversed an amount of Rs. 10,509/- being the credit involved in the input lying in balance as on 31-3-1993. 3. Verification of private records of the appellant revealed that he had additional stock of inputs over and above the ones declared by him to be lying in stock at the time of reversal of credit. Modvat credit involved in these inputs was Rs. 46,997/-. The allegation is that the appellant deliberately did not declare these ....

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....se was paid. But these inputs were used in the manufacture of thinners which are exempt from payment of duty. Credit of Rs. 14,961/- was wrongly availed according to the Department. This was not contested. The fifth dispute pertains to credit of Rs. 7,301,47 which was taken even before the receipt of subsidiary certificates. According to the Department, such procedure is not authorised under the Rules and therefore credit taken is disallowed. The sixth and the last issue pertains to wrong credit of Rs. 318/- and Rs. 48/- taken in RG23A Pt. II, dated 6-6-1992 on the strength of GP1 without first entering the quantity so received under the gate pass in RG23 Pt. I. Credit was denied on this ground. 5. Heard Both sides. 6. The learn....

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.... agree with the ld. Advocate's contention that credit cannot be denied on this ground [Demosha Chemicals v. CCE, Surat, 1999 (107) E.L.T. 443 (T) relied upon]. In regard to the department's contention that Rs. 7,301.47 taken as credit even before the receipt of subsidiary certificate the Advocate contended that it is a mere irregularity [CCE v. Amal Rasayan Ltd., 1993 (68) E.L.T. 446 (T) relied upon]. I agree with the Advocate's contention. Lastly, in regard to the credit of Rs. 318/- and Rs. 48/- the Advocate contended that these amounts were demanded on the ground that credit was taken in Part II RG23A without a corresponding entry in Part I. I agree with the contention of the learned Advocate that credit cannot be denied on this ground. ....