IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH. C.E.A. No. 8 of 2008 DATE OF DECISION : 08.07.2008 Commissioner of Central Excise, Jalandhar (Headquarters at Chandigarh) .... APPELLANT Versus M/s Digvijay Steel Industries, G.T. Road, Batala ..... RESPONDENT CORAM :- HON'BLE MR. JUSTICE SATISH KUMAR MITTAL HON'BLE MR. JUSTICE RAKESH KUMAR GARG Present: Mr. Ashwinie Kumar Bansal, Advocate, for the appellant-revenue. * * * SATISH KUMAR MITTAL , J. The Commissioner of Central Excise, Jalandhar, has filed this appeal under Section 35 (G) of the Central Excise Act, 1944 (hereinafter referred to as `the Act'), against the order dated 13.2.2007, passed by the Custom, Excise & Service Tax and Appellate Tribunal, New Delhi, raising the following substantial question of law, arising out of the aforesaid order of the Tribunal : “Whether the manufacturer of final products is entitled to deemed credit under Notification 58/97-CE dated 30.8.1997 when the manufacturer-supplier of inputs has not paid Central Excise duty and given a wrong certificate/no certificate on the body of invoices about dischargement under rule 96ZP of the erstwhile Central Excise Rules, 1944?” CEA No. 8 of 2008 -2- In this case, the assessee availed deemed modvat credit of Rs.10,012/-, under the provision of the then Section 3A of the Act and Rule 57A (6) of the Central Excise Rules, 1944 (hereinafter referred to as `the Rules') read with Notification No. 58/97 – Central Excise, dated 30.8.1997, on the strength of invoice No. 2163 dated 23.8.1999, issued by M/s Devta Steel Rolling Mills, Mandi Gobindgarh. During the course of modvat verification, it was noticed that M/s Devta Steel Rolling Mills has not discharged its duty liability as per annual capacity of production, determined by the Commissioner, Central Excise, Chandigarh. By taking that the deemed credit of Rs. 10,012/- was not admissible to the respondent-assessee, the show cause notices were issued to the assessee proposing recovery of deemed credit of Rs. 10,012/- from him along with interest and penalty. The adjudicating authority, vide its order dated 31.12.2001 confirmed the demand in the case of the assessee, on the ground that the suppliers of the inputs did not discharge part of the duty on excess assessed capacity of their unit. Against the said order, the assessee filed an appeal. The Commissioner (Appeals) vide his order dated 30.1.2004, while placing reliance on the decisions in the casea of M/s Delhi Steel Industries Vs. CCE, Chandigarh, 2002 (149) ELT 673 (Tri) and M/s Vikas Pipe Vs. CCE, Chandigarh – II, 2003 (158) ELT 680 (P&H), allowed the credit to the assessee holding that in the light of Central Government's declaration contained in Para 2 of the notification No. 58/97-CE dated 30.8.1997, deemed modvat credit is not liable to be denied in absence of input CEA No. 8 of 2008 -3- manufacturer's declaration in terms of Para 4. Feeling aggrieved against the said order, the Revenue filed appeal before the CESTAT, who vide its order dated 24.9.2004 allowed the appeal and remanded the matter for fresh decision. In compliance of the said order, the Commissioner (Appeals), vide its order dated 25.2.2005, allowed the deemed modvat credit of Rs. 10,012/- to the assessee. Feeling aggrieved against the said order, the Revenue again filed appeal before the CESTAT, who vide its order dated 13.2.2007 dismissed the appeal, while holding that the issue raised by the Revenue has already been decided by this Court in the case of Vikas Pipes (supra), against the Revenue. Vide the impugned order dated 13.2.2007, the CESTAT also dismissed two other appeals, filed by the Revenue, in the case of another assessee, namely M/s Maa Sharda Rail Nirman (P) Ltd. We have heard counsel for the appellant-Revenue. Undisputedly, another appeal (ITA No. 107 of 2007), filed by the Revenue against the same impugned order, in the case of M/s Maa Sharda Rail Nirman (P) Ltd., raising the similar question of law, has already been dismissed by this Court on 26.2.2008, in view of the decision of this Court in the case of Vikas Pipes (supra). In view of the above, the instant appeal is also dismissed. ( SATISH KUMAR MITTAL ) JUDGE July 08, 2008 ( RAKESH KUMAR GARG ) ndj JUDGE