TMI Blog2015 (4) TMI 1101X X X X Extracts X X X X X X X X Extracts X X X X ..... be observed by the manufacturer. Therefore, when power is exercised under Rule 57G, the Central Government is not empowered to curtail any right conferred by the substantive provision of Rule 57A and, therefore, the Notification issued under Rule 57G prescribing the time limit for taking the credit as found by the High Court of Gujarat is found to be ultra vires, as it is beyond the power and is in conflict to the impugn provision of Rule 57A, these are based on the principle laid down by the Hon‟ble Supreme Court in the cases of Eicher Motors Limited Vs. Union of India [1999 (1) TMI 34 - SUPREME COURT OF INDIA] and Collector of Central Excise, Pune Vs. Dai Ichi Karkaria Limited [1999 (8) TMI 920 - SUPREME COURT OF INDIA]. Accordingly, the assessee was entitled to avail the MODVAT credit under Rule 57A, merely because of the time frame fixed in making the entries in Part II of RG-23A, and only because of some error in making the entry, denial of the benefit cannot be permitted. The act of the assessee in making such receipt of input in Part I of a single comprehensive RG-23 A action is evidence enough with regard to crystallization of right to MODVAT credit and merely be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was found on the basis of the duty paying documents that in the months of July, August and September 1995, the assessee had taken MODVAT credit to the tune of ₹ 35,07,645/- on the strength of duty paying documents which was found to have been issued more than six months prior to the date on which credit was taken. It was the case of the Revenue that under Rule 57G(2), the manufacturer is required to file a declaration under Rule 57G(1) after obtaining the dated acknowledgement, take credit of the duty paid on inputs received and in accordance to the second proviso to sub-rule, the manufacturer is restrained from taking credit after six months of the date of issuance of any documents specified. It was found that in the entries made in the documents maintained under RG-23 A - Part I II, even though in Part I the entry is made showing date of taking availment of MODVAT credit within the stipulated period of six months, but in Part II as the date was beyond six months, the Tribunal held that the facility of MODVAT cannot be extended as the assessee has not shown availing of the benefit in accordance to the requirement of the Rule. 4- Accordingly, by making the following obs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hin six months, but in Part II the entry number showing the date is beyond six months and it is only because of this entry made in Part II that MODVAT credit has been denied to the assessee. 7- Admittedly, the Tribunal in its order on 17.10.2000 and in the portion reproduced hereinabove, has clearly held that RG-23 A Part I Part II is a consolidated record, but it refused to grant MODVAT credit to the assessee because of the entry made in Part II, which was beyond six months. 8- In the case of Eicher Motors Limited Vs. Union of India, 1999 (106) ELT 3 (SC), it has been held that the provisions for facility of credit is as good as tax paid till adjustment of tax on future goods based on various commitments are made. It has been held that the provision for facility of credit granted to an assessee is a right accrued to the assessee on the date when they paid the tax on the raw material or the inputs and this right would continue until the facility available thereto gets worked out or until those goods existed. In paragraph 6, the Hon‟ble Supreme Court has dealt with the matter in the following manner: 6. Thus a right accrued to the assessee on the date when the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Rayon Corporation Limited Vs. Union of India, 2014 (306) ELT 551 (Guj), the Gujarat High Court has considered question identical in nature as is posed before us. In the case of Baroda Rayon Corporation Limited also, the benefit of MODVAT credit was denied to the assessee only because of an entry made in RG-23 A Part I Part II, showing a date beyond six months. In the said case, the principle of law governing grant of MODVAT credit; the requirement of Rules 57A and 57G; the law laid down in the case of Eicher Motors Limited (supra) and Dai Ichi Karkaria Limited (supra) have all been considered and it has been held by the Gujarat High Court in the aforesaid case has held that merely because the entry of date made in Part II is beyond six months, the benefit of MODVAT credit cannot be denied when from all other material available, including the entry made in Part I, it is found that the benefit can be granted to the assessee. 11- We are in full agreement with the principle laid down by the Gujarat High Court wherein also under similar circumstances, identical action has been quashed and MODVAT credit extended. We agree with the Gujarat High Court when it says that the right to av ..... X X X X Extracts X X X X X X X X Extracts X X X X
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