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TMI Blog2010 (12) TMI 993X X X X Extracts X X X X X X X X Extracts X X X X ..... West Zonal Bench, Ahmedabad [for short, 'the Tribunal' hereinafter], raising the following questions : "[A] Whether in the facts and circumstances of the case, the Tribunal has committed substantial error of law by extending benefit of Modvat credit to the respondent by applying decision in case of M/s. N.M. Nagpal (P) Ltd., vide order No. 732-733/06-Ex, dated 9-8-2006? [B] Whether in the facts and circumstances of the case, the respondent is eligible to avail the benefit of Notification No. 5/98 dated 2-6-1998 and also Modvat credit of inputs used for the said goods? [C] Whether in the facts and circumstances of the case, the Tribunal has committed substantial error of law in setting aside penalty imposed under Rule 173Q( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cation No. 5/98 dated 2-6-98, the benefit of exemption is available to the unit subject to the condition that the manufacturer does not avail of credit of duty paid under Rule 57A or 57B, on products mentioned in column No. 2 at Sl. No. 69 to table annexed to above Notification or any other products manufactured in the same factory. During the visit of Central Excise officers, it was noticed that the assessee has taken Modvat credit under Rule 57A/57B and have also cleared their final products at NIL rate of duty. It has therefore been alleged that the appellant has wrongfully availed benefit of Notification No. 5/98 dated 2-6-1998 violating its condition No. 10 at Sl. No. 69. A show cause notice dated 9-1-1999 therefore came to be issued w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he facts and circumstances of the case, penalty is set aside, by following the above referred decision of the Tribunal. Appeal is disposed off accordingly." 3. The revenue in the present appeal is aggrieved by the impugned order of the Tribunal to the extent the same grants the benefit of MODVAT credit and cum-duty price and sets aside the penalty. 4. We have heard Mr. R.J. Oza, learned senior Standing Counsel for the appellant and Mr. Paresh Dave, learned advocate for the respondent-assessee at length and in great detail. We have also perused the memo of appeal as well as the order passed by the Adjudicating Authority, Commissioner (Appeals) and the Tribunal. 5. Mr. R.J. Oza learned senior standing counsel for the appella ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... question of interpretation of the notification, and there being no suppression or mis-declaration of facts the Tribunal was justified in setting aside the penalty. It was submitted that in the circumstances, merely because the Tribunal has not passed a detailed order the same does not warrant any interference at the hands of this court. 7. A perusal of the impugned order of the Tribunal indicates that before the Tribunal, the assessee had not pursued the appeal on merits and had conceded that the issue of interpretation of notification No. 5/98-C.E. stands concluded against the assessee by the decision of the Tribunal in the case of M/s. N. M. Nagpal (P) Ltd. However, it was submitted that in the case of M/s. Nagpal (P) Ltd. while in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it acceptance. 9. Insofar as extending the benefit of Modvat credit is concerned, no infirmity can be found in the approach adopted by the Tribunal inasmuch as if the assessee is not entitled to exemption under the notification in question, it would certainly be entitled to avail of Modvat credit in respect of the raw material used in the manufacture of the goods in question. As regards the grant of benefit of cum-duty price, the Supreme Court in the case of Commissioner of Central Excise, Delhi v. Maruti Udyog Ltd., (supra) has held thus : "4 Section 4 of the Central Excises and Salt Act, 1944 provides for valuation of excisable goods for purposes of charging of duty of excise. Under Section 4(1), the duty of excise is chargeab ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd determination of duty amount. 11. Insofar as setting aside of the penalty is concerned, a perusal of the order made by the Adjudicating Authority as well as the Commissioner (Appeals) indicates that there are no findings as regards suppression or mis-declaration. The main dispute involved is as regards the interpretation of notification No. 5/98. In the circumstances, the Tribunal was justified in setting aside the penalty. 12. In the light of the aforesaid discussion, it is not possible to state that the Tribunal has committed any legal error so as to warrant interference. No question of law, much less, a substantial question of law can be stated to arise out of the impugned order of the Tribunal. The appeal is, accordingly, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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