TMI Blog2013 (9) TMI 94X X X X Extracts X X X X X X X X Extracts X X X X ..... al Board's clarification that the job workers were entitled to claim MODVAT credit as per the Board's circular. It was a matter of relevance to note that the decision of the Delhi High Court in SHARDA MOTORS INDUSTRIES LTD. Versus COMMISSIONER OF C. EX., CHENNAI-II [2002 (3) TMI 188 - CEGAT, NEW DELHI ] had attained finality and the Department had also accepted the same – there was no justification in the Department taking a diametrically opposite view - The clarificatory letter clearly indicated the intention of the Revenue to grant relief in respect of job worker and to the persons who obtained capital goods – Decided in favour of Assessee. - C. M. A. No. 3754 of 2005 and CMP. No. 18794 of 2005 - - - Dated:- 18-7-2013 - Chitra Venk ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... i Motors (India) Limited. The assessee availed MODVAT credit in respect of machineries falling under Chapter 84 and 85 of the Central Excise Tariff Act, 1985 to the tune of Rs.1,09,39,967/- which were lent by M/s. Hyundai Motors India Limited to the assessee. It is stated that M/s. Hyundai Motors India Limited had removed the said capital goods by reversing the applicable excise duties as per the provisions of Rule 57S(I)(ii) of the Central Excise Rules, 1944, as it originally stood. The assessee herein had received the said capital goods under a leave and licence agreement with M/s.Hyundai Motors India Limited, and as per the agreement, the ownership of the said capital goods rested with M/s.Hyundai Motors India Limited and the assessee wa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hire-purchase, lease or by a loan agreement from a finance company as other modes of acquisition, 'leave and licence' agreement not being one such recognition, the benefit of availing of MODVAT credit was not sustainable in law. Aggrieved by this, the assessee preferred an appeal before the Commissioner of Central Excise. As against the order of the Commissioner dismissing the appeal, the assessee went on appeal before the Customs, Excise and Service Tax Appellate Tribunal. 4. On hearing the claim of the assessee, the Tribunal pointed out that the copy of the agreement on 'leave and licence', as regards supply of import goods were not made available to the Department at any point of time; however, on going through the agreement produced b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... AT credit on capital goods, the assessee should be either an owner of the goods or should have acquired capital goods on lease or on hire purchase or on loan basis. Having thus held, it further pointed out that copy of the agreement produced before it was intended to cover up the illegal transactions. In the circumstances, there was conscious attempt to hold back vital information from the Department. Consequently, the Tribunal upheld the contention of the Revenue. It may be of relevance to note herein that there was difference of opinion on this before the Technical Member and Judicial Member, who held that there was no suppression of facts. Learned Judicial Member held that the assessee was entitled to avail MODVAT credit on the goods rec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as amended later on, as per which, the benefit would be available to the job worker only subsequently thereon. In the circumstances, as per the law then available, the assessee was not entitled to claim benefit on MODVAT credit. 7. Per contra, learned counsel appearing for the assessee produced before us the copy of the decision of SHARDA MOTORS INDUSTRIES, wherein the facts are not different from that of the present case. A reading of the said order shows a reference to the clarificatory letter issued to M/s. Maruti Udyog Limited and M/s.TELCO viewing that MODVAT credit could be taken in respect of Jigs and moulds sent to job worker. Considering the said clarification, we sought for the copy of the same. Learned counsel for the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e herein as well as the assessee in SHARDA MOTORS INDUSTRIES LIMITED were manufacturers of automobile components for M/s.Hyundai Motors India Limited, from whom, both the assessees received capital goods under leave and licence agreement. The assessee availed MODVAT credit on capital goods belonging to M/s.Hyundai Motors India Limited. The leave and licence agreement in both the assessee's case are identical. 10. In fact, in the reply dated 31.10.2001 to the show cause notice, Hyundai Motors India Limited made a specific mention about the fact that M/s.Hyundai Motors India Limited had given its capital goods under leave and licence agreement and that the capital goods originally received by Hyundai Motors were entered in the books of acco ..... X X X X Extracts X X X X X X X X Extracts X X X X
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