Customs, Excise and Gold Tribunal - Mumbai
Hardcastle And Waud Mfg. Co. Ltd. vs Cce on 15 April, 1999
Equivalent citations: 1999(84)ECR740(TRI.-MUMBAI)
ORDER J.N. Srinivasa Murthy, Member (J)
1. The appellants and facts in both the cases are common and the impugned order is also of the same date. Hence both the matters are taken up together for consideration of the stay applications and the appeal with the consent of both the sides.
2. The facts of the case are that the appellant is engaged in the manufacture of paints etc., for which various capital goods at Serial No. 1 to 9 mentioned in Para 3 of the appeal memorandum is required (E/244/99). The declaration was filed claiming modvat with the delay of 1 to 2 months. Show Cause Notice was issued on the ground that the declarations are filed after one month from the date of the receipt of the goods in the factory, also availed and utilised the mod-vat credit towards payment of duty on excisable goods manufactured and cleared by them. The demand was for Rs. 8,09,214/- under the show cause notice dt. 25.1.1996 alleging contravention of Rule 57T(1), 57S(2) read with Rule 57Q of the Central Excise Rules and also for a penalty under Rule 173Q of the Central Excise Rules in E/244/99. In E/245/99 show cause notice was issued demanding Rs. 64,641/- alleging that the goods on which modvat credit was taken in this case do not come within the definition of the capital goods as per the explanation appearing below Rule 157Q(1) (sic), and also on the count that the declaration was filed beyond 1 month from the period of receipt of the goods in the factory. The product covered are mentioned in item 1 to 5 in the order in original, such as container 1000 ltrs. Trolley, Electric Motors, Aluminium Cond. PVC. Armoured Cables. The personal penalty was also proposed under Rule 173Q. After the receipt of the reply in both the cases, and holding personal hearing, in which the party and the consultant was heard, which has resulted in the order in original confirming the demand in both the cases. Penalty of Rs. 5,000/- was imposed in E/245/99 and penalty of Rs. 80,000/- was imposed in E/244/99. The appeal; preferred against this order resulted in the dismissal of the same on the ground that the stay order passed in both the cases are not complied. Hence these appeals.
3. Shri C.S. Lodha the learned Counsel appearing for the appellants has extensively argued on the merits of the case, with the request to decide the case on merits. The Ld. JDR Shri K.C. Agarwal has strongly urged that the impugned order is proper and correct and the appellant has no right of audience on the merits of the case, unless the stay order is complied which is pre-requisite under Section 35-F of the Central Excise Act, 1944.
4. Perused the show cause notice, and the reply, and the orders of the lower authorities and declarations and the orders of the stay application and appeal, and the appellant's letter dt. 23.11.1995 for condonation of delay, and the appeal memorandum, and also the ruling cited by the Ld. Counsel in his case. The order in appeal does not deal with the merits of the case. The stay orders in both the cases under which the appellant was directed to deposit the entire amount involved in the case was not complied by the appellant, as a result of which the appeal itself was dismissed for non-compliance of the order dt. 24.8.1998, which is clearly under Section 35-F of the Central Excise Act. The appellant has not moved the appellate authority after the passing of the stay order, either to modify the stay order or seeking time to comply the stay order. The appellant under Clause (i) in page 4 and 5 of the appeal memorandum has explained that since the appellant's financial position was not good, the appellant could not comply with the stay order. There is no reason why it was not brought to the notice of the Commissioner pleading the financial inability to comply with the stay order. In the absence of it, the appeals of the appellant came to be dismissed for non-compliance under Section 35-F of the Central Excise Act only. So under these circumstances the appeals cannot be dealt with on the merits of the case, when the Commissioner (Appeals) had no opportunity to do so. If the merit is dealt with now, it is only considering with the order-in-original of the Assistant Commissioner, which is not proper and correct.
5. Even here the appellant has not made out the case with the supporting material about the financial hardship. The merits of the case cannot be considered unless the appellant cross the preliminary stage of complying the requirement of Section 35-F of the Central Excise Act. To that end so in E 7245/99 the appellant shall deposit 30,000/- within one month from the date of the receipt of the order and report compliance to the Commissioner (Appeals), subject to which the appeal is allowed by way of remand with the direction to the Commissioner (Appeals) to hear the appellant on the merits of the case and dispose of the appeal according to law.
6. In E/244/99, there are nine capital goods such as Powder Coating Process Equipments with Accessories, Electronic Weighing Machine, Sealing Machine Kent Oil Meter, Vibro Separator and Filter, Heavy Duty Impact Tester, Grinding Mill, Master Sizer Micro Analyser and Compressed Air Drier. The rulings cited by the Ld. Counsel for the appellant only covers Roto Pumps, Electric Hoists and Conveyor Belts, Stainless Steel Tank, Cooling vessels 1998 (98) ELT 674 (Tribunal) in the case of Dabur India Ltd. v. Commissioner of Central Excise, Meerut, and Electric Cables, Transformers, Air Compressors other than of a kind used in refrigerating and air conditioning appliances, equipment for water treatment plant, Black Steel Tubes/Pipe Fittings, Resin bonded fibre glass insulation material, cooling tower material, Neutral Grounding (Electrical Resistors), Thermometers, Oxygen Gas level Gauges and Aluminium tubes in in the case of Modem Petrofils v. Commissioner of Central Excise, Baroda, and Electrical Transformers and Electronic Panel Board 1996 (86) ELT (Tribunal) in the case of Collector of Central Excise v. Navbhnrat Paper Mills and cane unloader in in the case of Collector of Central Excise v. Mansurpur Sugar Mills Ltd and Transformers in the case of Commissioner of Customs and Central Excise, Jaipur v. Indian Rayon hid. Ltd. and electrical wires and cables and EOT Cranes 1996 (88) ELT 532 and Load power supply, Panels, Cables, junction box, Transformers, Printed Circuits and other items, Master cord station monitoring controller /I/P assembly Controller resistance are considered under finding are given whether the capital goods or not. But none of the goods involved in this are covered by the above rulings.
7. Looking to the appeal memorandum, regarding the financial hardship, and looking to the amount involved in this case, I feel the ends of justice will be met if the appellant is called upon to deposit Rs. 80,000/- within two months from the date of the receipt of the order, and report compliance to the Commissioner (Appeals), subject to which the appeal is allowed and the impugned order is set aside, and the matter is remanded back to the Commissioner (Appeals) to hear the appellant and decide the case on merits according to law. In both the cases, the pre-deposit of the penalty amount is waived, and recovery of the same and the balance of the amount involved in both the cases is stayed subject to the compliance of the above order. Hence the following order.
ORDER
8. For the reasons discussed above, the stay applications are allowed in the above terms, and the appeals are allowed and the impugned order is set aside. The appellant on complying the above orders, the Commissioner (Appeals) shall hear the appellant on the merits of the cases and dispose of the appeals according to law.