TMI Blog2005 (7) TMI 461X X X X Extracts X X X X X X X X Extracts X X X X ..... The appellants took deemed credit of Rs. 11,72,650/- and Rs. 3,32,976/- during the said period on the ship breaking scrap in terms of Board s Letter F. No. T8/36/94-TRU, dated 1-3-1994. Out of the said amount of credit the Commissioner (Appeals) confirmed denial of credit of Rs. 11,72,600/- and Rs. 3,32,976/- imposed a fine of Rs. 2,00,000/- after confiscating the plant machinery, imposed a penalty of Rs. 25 lakhs on the appellant company under Rule 173Q and imposed a penalty of Rs. 10 lakhs under Rule 209A on the power of attorney holder. 3.The appellant company was a re-rolling mills. When it came to know of the circular above cited they took credit of the said amounts as deemed credit on 7-11-1995 on the inputs procured by them some ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1994. [M.F. (D.R.) Order No.TS/36/94-TRU dated 1-3-1994] . Modvat - Deemed credit to ship breakers, denial of It has been brought to the notice of the Board that scrap generated by breaking of a ship etc. is not being allowed deemed Modvat credit by certain field formations. The ship-breakers have also represented to the Board. The matter has been examined and the following instructions are issued :- Rule 57G of the Central Excise Rules, 1944 stipulates that the Government has the power to allow deemed credit having regard to the period that has elapsed since the duty of excise was imposed on any inputs, the position of demand and supply of the said inputs in the country and any other relevant considerations. If no duty is imposed on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... plant and machinery under Rule 173Q. The appellants went ahead and took the credit even when they were asked not to do so by the Range Superintendent it appears. 8.While we understand the provocation caused we cannot support the imposition of such heavy penalties and confiscation on a matter concerning interpretation of Notification dated 1-3-1994 cited supra. Having said so we observe that the appellants were definitely acting in a manner detrimental to Government Revenue. Such deliberate violation calls for penalty on the company and the power of attorney holder. 9.Having regard to what has been discussed above we uphold the denial of credit. We reduce the penalty on the appellant company to Rs. 2 lakhs and on the power attorney hol ..... X X X X Extracts X X X X X X X X Extracts X X X X
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