TMI Blog2016 (12) TMI 837X X X X Extracts X X X X X X X X Extracts X X X X ..... e pass. However, we find that the modvat credit itself is not admissible for the basic reason that these goods do not satisfy the criteria of input or capital goods. Time bar - Held that: - to obviate the difficulty of payment of duty twice, Rule 173L provides for refund of the duty paid on the goods at the time of original clearance. Such refunds are subject to the condition prescribed in Rule 173L. The refund claim under such circumstances is required to be filed within the period prescribed under Section 11B. The relevant date as per Section 11B in this case is the date of entry of the goods into the factory for the purposes of remaking, refinishing, reconditioning etc - It is on record that the last consignment was brought back to th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat the existing stock with M/s Vardhman Chemicals Ltd. would have undergone deteriotion, appellant decided to undertake reprocessing and also marketing of the product. Guidance was sought from the Central Excise Officers during February 1996 and the appellant sought permission to avail credit of the duty paid on clearance of bulk goods against the original duty paying documents. Appellant was granted permission under Rule 173H to bring back the goods, repack and clear the same on payment of duty. However, they were informed vide letter dated 03.02.1997, that no credit would be available in terms of second proviso to Rule 57G inserted by Notification No. 28/95-CE(NT), which stated that the credit is to be availed within 6 months from the da ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... document under Rule 57-G; (ii) The refund claim filed for the duty paid subsequently, is time barred, as the same was filed on 04.01.1999 and the last consignment was received on 29.03.1998; (iii) The appellant has not submitted any proof regarding their refund claim not being hit by bar of unjust enrichment. 4. Appellant filed detailed replies to the aforesaid SCN, stating that denial of modvat credit as a condition for bringing back goods is illegal. Further, in respect of the refund claim, it was stated that the condition imposed requiring certificates from respective jurisdictional excise officers of packing centers, was illegal. Further, the delay by the department in granting such certificates was the reason for the ref ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s of the 2nd proviso to Rule 57G since such proviso itself has been struck down as ultra virus by the Hon ble Gujarat High Court in the case of Baroda Rayon Corporation Ltd. vs. Union of India 2014 (306) ELT 551 (Guj.). They have also relied upon the decision of the Hon ble Supreme Court in Osram Surya (P) Ltd. vs. CCE 2002 (142) ELT 5 (SC) in which it has been held that such conditions prescribed in Rule 57G will be applicable prospectively. 8. In the alternative the appellant has claimed that they will be entitled to refund of duty paid on subsequent clearance of the reprocessed goods, since duty cannot be charged twice on the same goods. They have also submitted that their refund claim should be considered as filed within time inasmuc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rstwhile rule, was admissible for goods which are in the nature of inputs as well as capital goods. The defective goods brought back into the factory cannot be categorized under either of the two categories; consequently, the claim of modvat credit has to be disallowed as has been rightly done by the authority below. A lot of arguments have been raised by the appellant regarding the 2nd proviso to Rule 57G which allows modvat credit to be taken only within a period of six months from the date of the gate pass. However, we find that the modvat credit itself is not admissible for the basic reason that these goods do not satisfy the criteria of input or capital goods. 12. When goods manufactured and cleared by an assessee are found to be de ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... risdictional Assistant Commissioner on 30.12.1998 which was returned for making good certain deficiencies. Even if this date is taken, the claim is hopelessly time barred. The other argument advanced by the appellant is that the delay in filing of the refund claim was on account of the delay in procuring certificates from various jurisdictional Central Excise authorities to the effect that no modvat credit has been availed on the defective goods originally cleared and subsequently returned. The time limit prescribed under Section 11B of the Central Excise Act is mandatory and cannot be diluted for a reason other than that mentioned therein. While we are able to appreciate the claim of the appellant that such delays might have occurred in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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