IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH. Central Excise Appeal No.12 of 2004 Date of Decision: March 03, 2010 The Commissioner of Central Excise .......Appellant Versus M/s Maruti Udyog Ltd. .......Respondents CORAM:- HON'BLE MR.JUSTICE M. M. KUMAR HON'BLE MR.JUSTICE JITENDRA CHAUHAN Present: Mr.Kamal Sehgal, Senior Standing counsel for the appellant. Mr.AR Madhav Rao, Advocate and Mr.Tarun Jain, Advocate for the respondents. Notes: 1) To be referred to the reporters or not? 2) Whether the judgment should be reported in the Digest? <><><> M. M. KUMAR, J. This order shall dispose of six appeals/petition* as common questions of law and facts are involved. However, the facts are being taken from Central Excise Appeal No.12 of 2004. The following questions of law have been raised by the Revenue: i) As to what extent the credit on the inputs procured from 100% Export-Oriented Undertaking was allowed by the Law during the period in question in this case; and whether the Central Excise Appeal No.12 of 2004 -2- Hon'ble Tribunal was right in allowing the credit in excess of the CVD, which was actually paid on those inputs? ii)Whether penalty equal to the duty determined can be imposed under Section 11 Ac of the Central Excise Act, 1944 in such cases? A similar question was decided by a larger Bench of CEGAT, in the case of Vikram Ispat v. CCE, reported in 2000(120) ELT 800. Against the aforesaid order, the Revenue approached the Bombay High Court by filing Central Excise Application No.1 of 2006. The Bombay High Court, after considering the notification No.5/94 Central Excise (NT) dated 1.3.1994 has concluded that since the issue raised necessarily involved the rate of duty within the meaning of Section 35-G of the Central Excise Act, 1944 (for brevity 'the Act'), the appeal would be competent before Hon'ble the Supreme Court. The observation of the Bombay High Court, in that context, reads as under: “ Whether on the facts and in the circumstances of the case the Tribunal was right in law in holding that the assessee was entitled to avail Modvat Credit on inputs received by it from Kudremukh Iron Ore Company Ltd., (a 100% EOU) inspite of the restrictions laid down regarding availment of credit per the first proviso to Notification No.5/94 Central Excise (NT) dated 1.3.1994 under which the credit of duty to be availed shall be restricted to the extent of duty which is equal to the additional duty leviable on the goods under Section 3 of the Customs Tariff Act, 1975 paid for such inputs?” Learned counsel for the Revenue could not dispute the aforesaid proposition. Learned counsel for the parties have jointly stated that the question of rate of duty would be involved and appeal, if any, would be Central Excise Appeal No.12 of 2004 -3- competent before Hon'ble the Supreme Court in view of the provisions of Section 35-G of the Act. This was also the course adopted by the Bombay High Court in its order Mark 'A'. Accordingly, these appeals are disposed of with a liberty to the Revenue to file appeal before Hon'ble the Supreme Court. A photo copy of this order be placed on the record of connected appeals and petition. ( M. M. KUMAR ) JUDGE ( JITENDRA CHAUHAN ) March 03, 2010 JUDGE SRM * Sr.No. Case No. Parties Name 1 CEA 12 of 2004 The Commissioner Central Excise v. M/s Maruti Udyog and another 2 CEA No.11 of 2004 Commissioner of Central Excise v. M/s Maruti Udyog Ltd. And another 3 CEA No.155 of 2006 Commissioner of Central Excise Commissionerate v. M/s Lumax Industries Ltd. 4 CEA 158 of 2005 Commissioner of Central Excise v. Central Excise & Service Tax Appellate Tribunal and another 5 CEA 181 of 2005 Commissioner of Central Excise Delhi v. M/s Innovative Tech.Pack Ltd. and another 6 GCR No.2 of 2006 Commissioner of Central Excise v. Maruti Udyog Ltd. & others ( M. M. KUMAR ) JUDGE ( JITENDRA CHAUHAN ) March 03, 2010 JUDGE SRM