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Himalaya Industries Vs. the Collector of Central Excise - Court Judgment

LegalCrystal Citation
CourtCustoms Excise and Service Tax Appellate Tribunal CESTAT Delhi
Decided On
Judge
Reported in(1985)LC2137Tri(Delhi)
AppellantHimalaya Industries
RespondentThe Collector of Central Excise
Excerpt:
.....by the appellants during the period 1.8.1981 which the appellants claim to be in the nature of steel forgings, at intermediary stage, for the manufacture of their final product, viz. nuts & bolts. the appellants plead that these steel forgings (blank bolts) were manufactured out of duty-paid steel-rods, and at intermediary stage, would not attract duty under item 26aa of the central excise tariff. they also contend time-bar with reference to show cause notice whereby duty demand has been made, on the plea that there was no clandestine removal of the goods and that all information and particulars of clearances was duly reflected in their books of account, and even now the information for computing the duty demand had been collected from the said books of account. for the same.....
Judgment:
1. The short question falling for determination in this Appeal is as to the liability to lavy of excise duty of the products described as " i.e. Un-threaded bolts, cleared by the appellants during the period 1.8.1981 which the appellants claim to be in the nature of steel forgings, at intermediary stage, for the manufacture of their final product, viz. nuts & bolts. The appellants plead that these steel forgings (blank bolts) were manufactured out of duty-paid steel-rods, and at intermediary stage, would not attract duty under Item 26AA of the Central Excise Tariff. They also contend time-bar with reference to show cause notice whereby duty demand has been made, on the plea that there was no clandestine removal of the goods and that all information and particulars of clearances was duly reflected in their books of account, and even now the information for computing the duty demand had been collected from the said books of account. For the same reason, they plead, that no case for imposition of penalty was made out.

2. At the hearing Shri A.K.S. Bedi, Advocate, appeared for the appellants whereas the respondent was represented by Shri A.Laxmikumaran, SDR. At the outset, Shri Laxmikumaran stated that the Central Government had issued instructions under Proviso to Rule 56A(3)(i)(b) of the Central Excise Rules, 1944, vide letter No.139/46/83-CX.4 dated 16th November, 1984, whereby it had been directed that for the period in dispute, namely, 1.8.1980 to 6.4.1981, the benefit of proforma credit and set-off, for steel forgings bemadeavailable in case it was established that they were manufactured out of duty-paid steel rods and, further, that the manufacturer was able to establish with the help of documents such claim for proforma credit although strict procedure in terms of Rule 56A may not have been followed. He even filed a copy of the said instructions and stated that the relief to the appellants could also be granted in the same terms.

In view of this position revealed by the Learned SDR, Shri A.K.S. Bedi stated that he would not press his other grounds and that relief in terms of these instructions may be given.

3. We, accordingly, allow the Appeal and setting aside the Order-in-Appeal, remand the matter to the Additional Collector of Central Excise, Chandigarh, to allow relief to the appellants by giving them the benefit of proforma credit on steel forgings on the basis of the records maintained by them in the light of the Government of India's instructions, issued vide letter No. 139/46/83-CX.4 dated 16th November, 1984, after affording full hearing opportunity for the purpose. We, however, hold that in view of the fact that the Central Government itself have taken remedial measures in the nature of instructions referred to above, no case for imposition of any penalty is made out at all.


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