Custom, Excise & Service Tax Tribunal
Jay Iron & Steel Industries Ltd vs Commissioner Of Central Excise, Raigad on 20 January, 2016
IN THE CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL WEST ZONAL BENCH AT MUMBAI COURT NO. IV Appeal No. E/1696/05-Mum [Arising out of Order-in-Original No. 78(33/RT)Commr/04-05 dated 23/02/2005 passed by the Commissioner, Central Excise & Customs, Raigad] For approval and signature: Honble Mr. Ramesh Nair, Member (Judicial) Honble Mr. Raju, Member (Technical) =======================================================
1. Whether Press Reporters may be allowed to see : No
the Order for publication as per Rule 27 of the
CESTAT (Procedure) Rules, 1982?
2. Whether it should be released under Rule 27 of the :
CESTAT (Procedure) Rules, 1982 for publication
in any authoritative report or not?
3. Whether Their Lordships wish to see the fair copy : seen
of the Order?
4. Whether Order is to be circulated to the Departmental: Yes
authorities?
=======================================================
Jay Iron & Steel Industries Ltd.
:
Appellant
VS
Commissioner of Central Excise, Raigad
:
Respondent
Appearance
Shri Sachin Chitnis, Adv. with C.S. Biradar, Adv. for the Appellant
Shri S.V. Nair, AC (AR) for the Respondent
CORAM:
Honble Mr. Ramesh Nair, Member (Judicial)
Honble Mr. Raju, Member (Technical)
Date of hearing: 05/01/2016
Date of decision: / /2016
ORDER NO.
Per : Ramesh Nair
The appeal is directed against Order-in-Original No. 78(33/RT)Commr/04-05 dated 23/02/2005 passed by the Commissioner, Central Excise & Customs, Raigad, wherein the Ld. Commissioner rejected the abatement claim for Rs. 19,77,770/- filed by the appellant for the period from 02-09-1999 to November, 1999 under Section 3A(3) of Central Excise Act, 1944 read with Rule 96ZP(2) of Central Excise Rules.
2. The fact of the case is that the appellant is engaged in the manufacture of M.S. non alloy ingots falling under sub-heading 7206.90 of the Schedule to the Central Excise Tariff Act, 1985. They opted for payment of duty under Rule 96ZO(3) of the Central Excise Rules, 1944 vide their letter dated 24-08-1999. The appellants production was suspended from 02-09-1999 to 14-01-2000. They filed an abatement claim for Rs. 19,77,770/- vide their letter dated 17-01-2000. In support of claim, they furnished a copy of letter dated 02-09-1999. Intimation of the closure of production and electric meter reading on 02-09-1999, a copy of letter dated 16-01-2000 was also submitted on 17-01-2000 intimating the resumption of production on 15-01-2000. The abatement claim of the appellant was rejected by the Commissioner vide impugned order on the ground that the appellant failed to declare closing balance of stock. The production was resumed on 15-01-2000, whereas the intimation was given on 17-01-2000. Thus they failed to intimate the fact of resumption of production either prior or on date of the resumption of production; while sending intimation the appellant failed to declare continuous closure period.
On the above ground, the abatement claim was rejected. Being aggrieved by the impugned order, the appellant is before us.
3. Shri Sachin Chitnis, Ld. Counsel with C.S. Biradar, Advocate for the appellant submits that the appellant have complied with substantial process laid down for the purpose of claiming the abatement and only for small infractions in following the process should not be the reason for denial of abatement. He submits that as regard non-declaration of closing balance stock, they are maintaining day to day stock account in their statuary record i.e. RG-1 and also filed returns. The closing stock required to be declared is appearing in the said records. Therefore, even though the closing stock was not declared in the intimation, it is condonable lapse. He further submits that regarding the non-declaration of continuous period of closure, the intimation of closure and intimation of resumption clearly reveal the closure period. Regarding timely filing of intimation of resumption of production, he submits that the production was resumed on 15-01-2000 and intimation was given on 17-01-2000 for the reason that 15th and 16th were holidays on account of Saturday & Sunday. Therefore, the intimation was filed on 17-01-2000, which is well within the time in terms of the provision of General Closure Act. In view of above, the appellant have complied the procedure substantially. However, even if, there is non-compliance of the procedure but it is established that the unit was closed for the continuous period, the abatement was allowed in various judgments. He placed reliance on the following judgments:
(i) Commr. of C.Ex., Surat-I vs. Sabnam Processors Pvt. Ltd. 2008 (224) ELT 275 (Tri.-Ahmd.)
(ii) Share Medical Care vs. Union of India 2007 (209) ELT 321 (S.C.)
(iii) Commr. of Customs, Chennai vs. Texworth International 2007 (220) ELT 487 (Tri.- Chennai)
(iv) Commr. of Customs, Chennai vs. Kankai Imports 2007 (7) STR 190 (Tri.- Chennai)
(v) Lokhandwala Construction Industries Ltd. vs. C.C.E., Mumbai-
1997 (92) ELT 703 (Tribunal)
4. On the other hand Shri S.V. Nair, Ld. Asstt. Commissioner (AR) appearing on behalf of the Revenue reiterates the findings of the impugned order.
5. We have carefully considered the submissions made by both the sides.
6. We find that the only procedure lapse on which the abatement was rejected are as under:
(a) The appellant failed to declare closing balance of stock.
(b) Intimation for resumption of production was filed belatedly on 17-01-2000 whereas the production was resumed on 15-01-2000.
(c) Failure to declaration continuous closer period.
We find that all the above lapse are the minor procedure lapse, on that basis abatement could not have been rejected. As regard the lapse of non-declaring the closing stock, we agree with the appellant that the closing stock is otherwise recorded and available in the stock account i.e. RG-1 register. It is also declared in monthly returns and both these records are statutory records. Therefore though the appellant did not declare the closing stock specifically, the same stands complied with as the same was declared in the RG-1 and monthly returns. Appellants production was resumed on 15-1-2000, however the intimation was filed on 17-1-2000, it is observed that 15th and 16th being Saturday and Sunday were holidays. Therefore, filing of intimation on 17-1-2000 cannot be treated as belated in terms of provision of General Clauses Act, accordingly to which any act to be done on a particular date and if any holiday falls on that date, the next working day shall be treated as date within the period prescribed. Therefore, there is no delay on the part of the appellant in filing the intimation on 17-01-2000. Regarding non-declaration of continuous closing period, it is a minor lapse, as from the intimation date of the closure and date of resumption of production, the period of closure can be easily ascertained. Therefore, it cannot be said, the period of closure is not in the knowledge of the department.
In view of the above, we find that substantial compliance of the procedure for claiming the abatement was made by the appellant. Moreover from all the judgments cited by the Ld. Counsel, it is clear that only due to minor procedure lapse, the abatement claim cannot be rejected. As per our above discussion, we are of the considered view that the appellant are entitled for the abatement as claimed by them. We, therefore, set aside the impugned order and allow the appeal.
(Order pronounced in court on ..) Raju Member (Technical) Ramesh Nair Member (Judicial) saifi 6 Appeal No. E/1696/05-Mum