TMI Blog1984 (1) TMI 305X X X X Extracts X X X X X X X X Extracts X X X X ..... g under Central Excise Tariff Item No. 34. For this purpose, they used duty paid parts and accessories of motor vehicles falling under Item No. 34-A CET. They work under the procedure prescribed in Rule 56-A of the Central Excise Rules, 1944 which permits taking proforma credit of the duty paid on component parts and raw materials used in the manufacture of specified excisable goods and availment of the said proforma credit towards payment of the excise duty payable on the finished excisable goods for the manufacture of which the duty paid components and raw materials have been used. During the period from 1-8-1980 to 31-3-1982, the appellants took proforma credit of duty amounting to ₹ 2,65,091.91, which had already been paid on non- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 66/79. He also held that there was a suppression of facts on the appellant s part and that, therefore, the Department had the benefit of the extended period of 5 years for the recovery of the wrongly availed of credit. In the result, he passed orders disallowing the availment of the credit of ₹ 2,65,091.91 taken by the appellants during the period 1-8-1980 to 31-3-1982 and further ordered that the amount lying in the appellant s RG 23 account as on 1-8-1980 would lapse. He further ordered the recovery of ₹ 2,46,983.35 being the amount of the proforma credit utilised by the appellants during the aforesaid period without proper authority. The Appellate Collector, in his order, now under challenge before us, held that the appellant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e 56A of the Central Excise Rules and in terms of Central Excise Notifications - (i) No. 110/79, dated 13-3-1979, (ii) No. 166/79, dated 19-4-1979, (iii) No. 187/79, dated 10-5-1979. This permission letter did not contain anything to the effect that it was to be operative only upto 1-8-1980. On 1-8-1980, all notifications including Notification No. 166/79 providing for the set-off procedure were rescinded by the Government of India by issue of Notification No. 113/80, dated 19-6-1980 which came into force from 1-8-1980. Shri Bidichandani, the learned Consultant, drew our attention to Notification No. 118/80, dated 19-7-1980 by which the Central Excise (7th Amendment) Rules, 1980 were notified and these were to come into force ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... material or component parts used in the manufacture of finished excisable goods - (i) ............. (ii) Unless - (a) duty has been paid for such material or component parts under the same item as the finished excisable goods, or, (b) remission or adjustment of duty paid for such material or component parts has been specifically sanctioned by the Central Government. With the rescinding of Notification No. 166/79, the sanction of the Central Government stood withdrawn and unless the appellants applied for fresh permission in terms of the new notification, they should not have continued to avail of the proforma credit procedure. 4. In reply, Shri Bidichandani submitted that, though Notification No. 166/79 was rescinded, it mu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the Central Government which, inter alia, substituted the expression Item No. 34-A , with the expression Item No. 68 in Notification No. 166/79. This change was, apparently because, with the enactment of the Finance Bill, the non-specified parts which fell under Item No. 34-A, came within the purview of Item 68 with effect from 10-5-1979. Now, the Department s case is that Notification No. 166/79 was rescinded on 1-8-1980 by Notification No. 113/80. Therefore, the sanction conveyed to the appellants by the Assistant Collector, Pune, in his letter dated 1-9-1980, which was with reference to Notification Nos. 110/79, 166/79 and 187/79 lapsed on 31-7-1980 and the appellants should have sought permission to continue to avail of the profo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... elves of the proforma credit procedure even after Notification No. 166/79 was rescinded on 1-8-1980. It is to be noted that motor vehicles falling under Item No. 34 were specified in the list of goods to which the proforma credit procedure was applicable under Rule 56A all along during the relevant period both prior and subsequent to 8-8-1980. On the question whether there was substantial compliance with the prescribed procedure, we note that the Appellate Collector has recorded a definite finding that credit was taken and utilised under valid permission of the proper authority, after filing the D3 intimation to the proper officer, credits have been taken in RG 23 Part II the RT 12 returns have been finally assessed for the material period ..... X X X X Extracts X X X X X X X X Extracts X X X X
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