TMI Blog2002 (2) TMI 282X X X X Extracts X X X X X X X X Extracts X X X X ..... se Tariff Act, 1985 and availed Modvat credit in respect of the glass bottles used by them. They were served with a show cause notice dt. 11-3-98 alleging that during the period 1993-94 to 1996-97 the appellants have not shown the actual production of the pharma goods equivalent to the glass bottles received by them as inputs and as such use of the glass bottles was less than on which Modvat credi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was not found favour with by the adjudicating authority, who observed that the breakage of bottles during the manufacturing process is as high as 65% to 70%, which the appellants have been unable to explain. He also observed that the appellants have already admitted their duty liability to the extent of 30% to 35% of the breakage/rejection and have also not kept any account of breakages/rejection. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bottles have not entered the manufacturing process, they would not be covered by the provisions of Rule 57D and the appellants are ready to reverse the credit on the same. In fact he submits that on the said basis, the appellants have already reversed the credit so availed. In this connection I find that if the bottles received in the appellants' factory are already broken in the cartons itself, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ncial years. The authorities have confirmed the duty by reversing the Modvat credit by observing that the appellants have not kept any accounts for such breakages. However, the authorities are not disputing the factum of breakages of the bottles during the course of manufacture, but suspect the breakage to be on the higher side. However, I find that there is no evidence to show that such bottles o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to reverse back the credit in respect of the broken bottles received by them. The bottles which were broken after they were issued from the Modvat account and during the manufacturing process are covered by the provisions of Rule 57D. As such I direct the original adjudicating authority to confirm the demand of duty only in respect of those bottles received in broken condition and to allow the cre ..... X X X X Extracts X X X X X X X X Extracts X X X X
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