R. Jayaraman, Member (T)

1. All the aforesaid four appeals are directed against the orders of the Collector of Customs & Central Excise (Appeals), Bombay noted against each above. These appeals have been filed by the department against the orders of the Collector (Appeals) setting aside the orders of the Assistant Collector confirming the demand for recovery of MOD VAT credit alleged to have been irregularly availed of on the ground of time bar.

2. The main contention urged in these appeals by the department is that in all these cases demands have been issued under Rule 57-I of the Central Excise Rules for recovery of the MOD VAT credit alleged to have been irregularly availed of and during the material period when these credits were availed of and the demands issued, Rule 57-I did not have any time limit prescribed for issuing such demand. The learned SDRs who were heard in the matter emphasised only on this aspect. They also pleaded that only after the amendment to Rule 57-I prescribing the time limit, it can be applied prospectively. They however conceded that the Collector (Appeals) has gone by the view taken by the Tribunal that Rule 57-I, even during the material period when the time limit was not prescribed, has to be read alongwith the statutory provision of Section 11A of the Central Excises and Salt Act and the time limit under Section 11A cannot be ignored. One of the arguments put forth in the appeal memorandum is that if it was the intention of the Govt. to apply the time limit under Section 11A of the Act they could have simply mentioned in the rule to the effect that the time limit as prescribed under Section 11A would be applicable. The fact that the subsequent amendment to Rule 57-I stipulates separately the time limit would go to indicate that Rule 57-I, during the material period, when the lime limit was not prescribed, is to be applied as it is, without recourse to Section 11A.

3. We have already taken the consistent view that the statutory provision laid down under Section 11A of the Act cannot be overlooked and the demand for MOD VAT credit even under Rule 57-I, especially when there was no time limit prescribed, has to be read in the context of Section 11A and we have also held that the relevant date for this purpose when Rule 57-I was not self-contained prescribing the time limit should be the date of filing of RT-12 Return as laid down in Section 11A. The argument of the department that the subsequent amendment of Rule 57-I did not adopt the time limit under Section 11A and hence when the time limit was not prescribed under Rule 57-I, there was no necessity to have re-course to Section 11A does not have merits, mainly because of the fact that Rule 57-I contemplates recovery of MOD VAT credit. The moment the credit is taken it would make inroad into the payment of duty On the final product by way of cash deposit because of the fact that the credit has to be utilised towards payment of duty. When the credit is allegedly taken irregularly, which would virtually result in short payment of duty on final product, the credit taken would come within the purview of Section 11A for purpose of applying time limit, even during the period when Rule 57-I does not prescribe time limit. Since we have taken this consistent view and disposed of many appeals, we have no reason to differ from the stand already taken by us. Accordingly we dismiss all these appeals filed by the department.