Customs, Excise and Gold Tribunal - Mumbai
Ashish Cans And Containers P. Ltd. vs Commissioner Of C. Ex. on 1 October, 1999
Equivalent citations: 2000(115)ELT378(TRI-MUMBAI)
ORDER J.H. Joglekar, Member (T)
1. The Tribunal in their order dated 1-7-1999, directed the present applicants to deposit a sum of Rs. 27 lakhs as a pre-condition to hearing of their appeal. A modification application was filed on 12-7-1999. In the meanwhile the Department detained certain goods, plant and machinery etc. on 4-8-1999 towards the payments of the duty. The Panchanama which was witnessed by the Officers of the applicant company did not refer to the stay order of the Tribunal nor the fact that no compliance thereto had been made. The Officers of the company also did not contest the seizure on this ground. Two applications are now filed, one is for seeking modification of the Stay Order, and the second for lifting of the seizure.
2. We have considered the first application. The applicants purchased plastic granules which were converted into powders, which powders were used in the manufacture of containers which were cleared duty free. The Show Cause Notice demanded duty on the powders. The Commissioner in the impugned order confirmed the demand. The plea taken by Shri Sheth, ld. Counsel before us today is that the granules used for manufacture of the powder were duty paid and that the credit of the duty paid on the granules was available for discharging the burden on the powder. It is also claimed that the inequities in the rates of duty at the material time would result in the assessees having a surplus credit balance of the Modvat of duty paid on the granules. As to the availability of such Modvat, he cites the Tribunal judgment in the case of Rotomould (India) P. Ltd. v. C.C.E., 1998 (102) E.L.T. 270. In reply to a direct question Shri Sheth fairly conceded that this aspect was not posed before the Tribunal when they made the Order. We find that before the Commissioner also, the emphasis was on other issues, and not on this aspect although in paragraph 14, the Commissioner himself had brought out the fact that the assessee could have availed of the Modvat credit if they paid duty on the product.
3. Thus, the single important issue having bearing on the problem was not posed from the beginning, either before the Commissioner or before the Tribunal when passing the orders on the stay application.
4. Shri Sheth, submits that for the failure of the Counsel to argue on a particular issue, the interests of the assessees should not suffer. We see his point, but we are also aware of a number of situations where the plea that certain arguments were left out is used for seeking change of the orders adverse to the assessees repeatedly with the possible intention of evading payment of directed amounts.
5. Shri Sheth refers to his calculations that the assessees would be left with surplus balance of credit even when the duty is confirmed and upheld. This cannot be verified except by referring the matter to the jurisdictional authorities which at this level we would not wish to do. This is because although Modvat credit had already been availed on duty paid goods on certain procedural aspects of the credit may be denied.
6. On finding that the most important aspect was not brought to the Tribunal's notice, leading to the Tribunal to specify a sum to be paid, we modify the order and waive the pre-deposit of the duty confirmed and the penalty imposed as a pre-condition of hearing of the appeal and stay its recovery.
7. As regards the second application, i.e. E/Misc. (Ors) 880-R/99-Mum, the request made is for ordering lifting of the detention of plant and machinery, certain appliances and certain dutiable goods, in terms of the Panchanama dated 4-8-1999. We have seen the Panchanama. It refers to the impugned order, but does not refer to the provision of law, under which the goods have been detained. In terms of the order in Modification of this Stay Order passed by us today, there may not be any reason for the Commissionerate to seize the excisable goods. As regards the plant and machinery, the confiscation thereof stands adjudged in the Commissioner's order. In the Stay Order dated 1-7-1999, there is no reference or mention of any prayer made by the applicant in that regard. The failure of the appellants to satisfy the terms of redemption would result in the vesting of the title of the plant and machinery etc. in the Govt. Section 35F of the Central Excise Act, 1944 speaks of waiver of the pre-deposit of duty confirmed and penalties imposed. It however, does not speak of making any orders in relation to the goods confiscated. Ordinarily where no attachment is made, the Tribunal permits continued use of such plant and machinery, etc. subject to an undertaking being given by the assessees. To that effect, in spite of the lack of jurisdiction under Section 35F the Tribunal makes such orders perhaps in terms of Rule 41 of the CEGAT (Procedure) Rules. But where the property already vests in the Govt., we have grave doubt about our competence to pass any orders presuming to possess the powers which Section 35F does not grant. On these observations, we decline to make any order on this Misc. application.
8. Ordered accordingly.