TMI Blog2002 (6) TMI 470X X X X Extracts X X X X X X X X Extracts X X X X ..... barred. 2. Shri K.K. Anand, learned Advocate, submitted that the appellants manufacture, inter alia, PPF Yarn of various deniers as well as PPFY draw twisted (DT) and flat twisted yarn of 210 deniers; that during the course of manufacture of yarn of 210 deniers, which is exempted from payment of duty under Notification No. 5/99, they were manufacturing PPFY of 500 deniers which was captively used without payment of duty; that after visit of Central Excise officers of their premises on 3-10-2000, a show cause notice dated 13-12-2001 was issued to them for demanding duty on PPFY cleared during the period July, 1999 to September, 2000 and for imposing the penalty. He, further, submitted that yarn of 500 deniers comes into existence only at ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat undrawn yarn at take up stage is stored under certain temperature and humidity condition before they are taken for drawing or draw texturing otherwise undrawn yarn would deteriorate and cannot be used for manufacture of textile for weaving or knitting purpose; that the Board has held that at this stage they are still in the semi-finished stage and are not marketable; that their manufacturing process is similar to the process discussed in paras 3 and 4 of the Circular. He relied upon the decision in the case of Moti Laminates Pvt. Ltd. v. CCE - 1995 (76) E.L.T. 241 (S.C.) wherein it was held that goods are dutiable only if they are marketable or capable of being marketed. He also mentioned that in taxation matter there is no estoppels as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has held that extended time-limit is not applicable in case of availability of Modvat credit to the assessee himself. He also claimed that they would in any case be eligible to take Modvat credit amounting to Rs. 28,75,408/- which was reversed by them and as such only a duty of Rs. 4,89,001/- would be payable by them. He relied upon the decision in the case of Hindalco Industries Ltd. v. CCE, Allahabad, [2001 (137) E.L.T. 539 (T) = 2001 (44) RLT 148] and J.K. Synthetics Ltd. v. CCE, Jaipur, 2000 (122) E.L.T. 38 (T). Finally he submitted that no penalty is imposable on the appellants at all and that too both under Section 11AC of the Central Excise Act and Rule 173Q of the Central Excise Rules; that in any event, the penal action, if any, ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n day 1, day-3 and day-7 which shows that it has sufficient shelf-life; that NITRA also has only opined that the product s shelf-life is very low as compared to POY and has not opined that it has no shelf-life. The learned Senior Departmental Representative also referred to RG-1 maintained by the Appellants to show that the appellants themselves were keeping the impugned products in stock for many days, which shows that the impugned product has shelf-life for more than two days as claimed by them and it is thus capable of being marketed. He also referred to appellant s letter dated 2-7-99 according to which the product is to be stored in the bonded store room and it is not mentioned that the said storage was under controlled system. He also ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ur opinion, have discharged the onus cast on them successfully by showing that the yarn manufactured by the appellant is kept in stock and used captively after a few days of manufacture by them. Secondly, they were purchasing the yarn of 500 denier from the market before they started manufacturing the yarn of 500 deniers themselves. This has been clearly admitted by Shri Kailash Chandra Joshi, Vice-President in his statement dated 29-12-2000. Shri Kailash Chandra Joshi looks after purchase, sale, production accounts and excise matters. He has deposed in his said statement that before the month of July, 1999, the Appellants were purchasing PPF Yarn of 500 deniers from the market Shri Mahesh Chandra Dadhichi, Authorised signatory, has also ad ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to the condition of proving duty paid nature of the inputs. In the present matter, the appellants have reversed the Modvat credit at the time of removing the yarn of 500 denier for captive consumption and this averment has not been rebutted by the Revenue. It has been held by the Tribunal in the case of J.K. Synthetics Ltd., supra, that if subsequently demand on chips is being confirmed, reversal of credit taken on caprolactum was not in Order. Re-credit of the amounts reversed, should be effected and duty on polyamide chips can be discharged against such credit at the option of the appellants . Similar views were expressed by the Tribunal in the case of Hindalco Industries Ltd., supra. We, therefore, hold that the appellants are eligible ..... X X X X Extracts X X X X X X X X Extracts X X X X
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