Custom, Excise & Service Tax Tribunal
M/S The Simbhaoli Sugar Mills Limited vs Cce, Noida on 11 August, 2010
CUSTOMS EXCISE & SERVICE TAX APPELLATE TRIBUNAL,
West Block No.2, R. K. Puram, New Delhi.
Date of hearing: 11.08.2010
Date of decision: 23.11.2010
For approval and signature:
Honble Shri Justice R.M.S. Khandeparkar, President
Honble Shri Rakesh Kumar, Member (Technical)
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1. Whether Press Reporters may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982.
2Whether it should be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?
3Whether Their Lordships wish to see the fair copy of the Order?
4Whether Order is to be circulated to the Departmental authorities?
Excise Appeal No. 566 of 2005 [Arising out of order-in-appeal No.238-CE/MRT-II/2004 dated 7.10.2004 passed by the Commissioner (Appeals) Customs & Central Excise, Meerut-II] M/s The Simbhaoli Sugar Mills Limited Appellants Vs. CCE, Noida Respondent Appearance: Rep. by Sh. Kapil Vaish, C. A. for the appellants.
Rep. by Sh. S.N. Singh, Jt. CDR for the respondent.
Coram: Honble Sh. Justice R.M.S. Khandeparkar, President Honble Sh. Rakesh Kumar, Member (Technical) Oral Order No._____ Per: Shri Justice R.M.S. Khandeparkar:
Heard the learned Advocate for the appellants and DR for the respondent.
2. This appeal arises from the order dated 7.10.2004 passed by the Commissioner (Appeals) Meerut. By the impugned order, the appeal filed by the department against the original order has been allowed. The Deputy Commissioner, Noida by its order dated 31.10.2001 had dropped the demand which was sought to be made against the appellants under eleven show cause notices issued during the period from October 1997 to May 2001.
3. Eleven show cause notices were issued to the appellants on the allegation that they had failed to pay the excise duty on the molasses allegedly lost due to natural causes. The appellants were engaged in manufacture of V.P. Sugar and molasses falling under heading No. 1701 and 1703 of the Central Excise Tariff Act, 1985. The appellants were storing non duty paid molasses in the steel tanks as well as kachcha pits in the factory. The appellants did not properly account for the quantity of molasses in their records and claimed remission of duty on the quantity of alleged losses. The adjudicating authority after hearing the parties dropped the demand for Rs.12,71,850/- against the appellants holding that the request made by the appellants for remission of duty on account of natural loss of molasses was genuine. Aggrieved by the same, the department filed appeal before the Commissioner (Appeals) Meerut. The lower appellate authority allowed the appeal on the sole ground that the Deputy Commissioner was not authorized to decide the demand under Rule 49 of the Central Excise Rules especially when the unit had applied for remission. It was simultaneously observed that the department was at liberty to get the issue of remission claim decided separately. Aggrieved by the same, the appellants have preferred the present appeal.
4. The impugned order is sought to be challenged on two grounds. Firstly, that the Commissioner (Appeals) could not have set aside the order of the adjudicating authority on the ground of alleged absence of powers to the Deputy Commissioner to decide the issue and secondly on the ground that in any case if the Commissioner (Appeals) was of the opinion that the order of the adjudicating authority was not sustainable on merits, he should have himself decided the same in accordance with provisions of law on merits. Reliance is placed in the decision in the matter of Pahwa Chemicals Pvt. Ltd. vs. Commissioner of Central Excise, Delhi reported in 2005 (181) ELT 339 (S.C.).
5. It is true that once the Commissioner (Appeals) finds an order passed by the adjudicating authority to be unsustainable, he is certainly empowered to set aside such order but in that case question of leaving the issue to be decided by some other authority does not arise and he has to decide the matter himself. Law on the point of absence of power to remand by the Commissioner (Appeals) is well settled. Applying the same to the facts of the case, therefore, the impugned order is not sustainable and is liable to be set aside.
6. As regards the merits of the case and effect of the decision of the Apex Court in Pahwa Chemicals case is concerned, it is too premature to deal with the said issue. The same will have to be considered on final adjudication of the matter by the Commissioner (Apepals).
7. In the result, the appeal succeeds. The impugned order is set aside. The matter is remanded to the Commissioner (Appeals) to decide the same in accordance with provisions of law.
[Justice R.M.S. Khandeparkar] President [Rakesh Kumar] Member [Technical] /Pant/ ??
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