TaxTMI 
TaxTMI 
2014 (6) TMI 757
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....he Central Excise Rules, 1944." Brief facts of the case are that the respondent is the manufacturer of C.R.Coils/sheets and G.P.Coils/sheets received certain consignment of C.R.Coils/sheets and G.P.Coils/sheets, which are excisable under Chapter 72 of Schedule to the Central Excise Tariff Act, 1985. The respondent has received C.R.Coils/sheets and G.P.Coils/sheets from different parties being defective and claimed modvat credit on the value of such goods, amounting to Rs.6,88,548/- during the period September, 1995 to March, 1996 under Rule 57-A read with Rule 57-G of Central Excise Rules, 1944 (hereinafter referred to as "Rules"). Assistant Commissioner issued show cause notice on the ground that C.R.Coils/sheets and G.P.Coils/sheets are ....
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.... of another final product. Therefore, C.R.Coils/sheets and G.P.Coils/sheets etc., which have been manufactured by the respondent, and have been subsequently, returned being defective and used in the manufacturing of final product, is eligible for the modvat credit under Rule 57-A of the Rules. He further submitted that under Notification No.5/94 C.E.(N.T.), dtd.01.03.1994 as amended time to time. All goods mentioned in the Schedule of Central Excise Tariff are notified for the modvat credit, unless specifically excluded. The goods used by the respondent are manufactured goods and were not covered under the excluded goods and, therefore, they were eligible for the modvat credit. In case of goods returned, the refund of duty could be claimed ....
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.... shall be allowed on inputs used in the manufacture of final products as well as on inputs used in or in relation to the manufacture of the final products whether directly or indirectly and whether contained in the final product or not. (5) Notwithstanding anything contained in sub-rule (1), the Central Government may, by notification in the Official Gazette declare the inputs on which declared duties of excise or additional duty (hereinafter referred to as declared duty) paid shall be deemed to have been paid at such rate or equivalent to such amount as may be specified in the said notification and allow the credit of such declare duty deemed to have been paid in such manner and subject to such conditions as may be specified in the said n....
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....nt refund of the duty paid on manufactured excisable goods issued for home consumption from a factory, which are returned to the same or any other factory for being re-made, refined, reconditioned or subjected to any other similar process in the factory: Provided that - (i) such goods are returned to the factory within one year of the date of payment of duty or within such further period or periods not exceeding one year, in the aggregate, as the (Commissioner) may, on sufficient cause being shown, permit in any particular case; (ii) the assessee gives information of the re-entry of each consignment of such excisable goods into the factory to the proper officer in writing in the proper form within twenty-four hours of such re-entry (or w....
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....b-rule (1) shall be paid until the processes mentioned therein, have been completed and an account under sub-rule (2) having been rendered to the satisfaction of the [Commissioner] within six months of the return of the goods to the factory. No refund shall be admissible in respect of the duty paid,---- (i) in respect of opened packages containing goods with concessional rates of duty or partial exemption for the small or cottage sector, as set forth in the [Schedule to the Central Excise Tariff Act, 1985 (5 of 1986))], or by a notification issued under rule 8 [or section 5A of the Act]; (ii) if the amount of refund payable on the goods is less than rupees fifty; (iii) on goods which are disposed of in any manner other than for productio....
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.... duty has been paid on the final product, which has been manufactured by the use of defective C.R.Coils/sheets and G.P.Coils/sheets etc. The claim of modvat credit has been introduced to avoid cascading effect of the tax namely that the duty should not be charged both on the raw material as well as on finished goods. Under the Rule whatever duty has been paid on the raw material/input, the same was liable to be adjusted with the amount of duty payable on the finished goods. To allow modvat credit under Rule 57-A of the Rules essential ingredient appears to be namely, that the goods should be specified under the notification issued under Rule 57-A of the Rules; such input are being used in or in relation to the manufacture of final products ....