Customs, Excise and Gold Tribunal - Delhi
Godwin Steels (P) Ltd. vs Commissioner Of Central Excise, ... on 15 February, 2002
Equivalent citations: 2002(141)ELT784(TRI-DEL)
ORDER G.R. Sharma, Member (T)
1. The Commissioner (Appeals) in the impugned order dt. 17-7-2001 held as under :
"I have carefully gone through the facts of the case and the submissions made in the appeal as well as at the time of personal hearing. Appellant opted for compounded levy scheme w.e.f. Sept. '97 and their duty liability was fixed at Rs. 1,66,556/-. In the month of Nov. '97, they paid only Rs. 85,000/-. I find once the capacity of the unit is fixed by Commissioner, the assessee was required to pay the Central Excise Duty calculated on the basis of their production capacity. In the instant case the appellants unit's capacity was fixed by the Commissioner w.e.f. Sept. '97 and they were required to pay Rs. 1,66,556/- per month. In Nov. '97, the appellant informed their Range Office that they had closed their factory till 16-11-97 and had started the production from 17-11-97. Hence from 17-11-97 to 30-11-97 they paid CE duty of Rs. 85,000/- on the plea that there was no production from 1-11-97 to 16-11-97.1 observe if the appellant had intended to stop the production in their factory for some days they were required to follow the procedure as laid down in Rule 96ZP(2) CER for claiming abatement. Since the procedure as detailed in rule (supra) has not been followed, the appellant was required to pay the duty as determined by the Commissioner. Order-in-Original is, therefore, upheld. Appeal rejected".
Being aggrieved by this order, the appellants have filed this appeal.
2. The facts of the case in brief are that the appellant is engaged in the manufacture of re-rolled products. Compounded levy was introduced in regard to re-rolling mills w.e.f. 1-9-97. The appellant opted for payment of duty in terms of Sub-rule (3) of Rule 96ZP of Central Excise Rules, 1944. The Commissioner concerned determined the Annual Capacity of Production and asked the appellants to pay Central Excise Duty of Rs. 1,66,556.55 per month in two equal instalments. The first instalment was to be paid by the 10th of each month and the second instalment by the last day of the month. During the month of November, the appellant deposited the duty short by Rs. 85,000/-. A SCN was issued to the appellant asking him to explain as to why duty short paid by him should not be demanded. The Asstt. Commissioner adjudicating the case and confirmed the demand against that order. The appellants filed an appeal before the Commissioner (Appeals). Ld. Commissioner (Appeals) held as indicated above.
3. Arguing the case for the appellant Shri Kulwinder Singh, ld. Counsel submits that the factory of the appellant started w.e.f. 17-11-97. He submits that since the factory worked only for 13 days, the appellant paid duty for 13 days. He submits that demand of the authorities for first payment of duty for the whole month is incorrect as the factory during the month of November worked only for 13 days. He submits that since the factory worked for 13 days and the appellants have paid duty on pro rata basis for 13 days, there was no question of any further demand being confirmed.
4. Shri Atul Saxena, ld. DR reiterates the findings of the authorities below and submits that the appellant applied for payment of duty in terms of Sub-rule (3) of Rule 96ZP, the Commissioner determined the annual capacity of production of the re-rolling mill. He submits that according to this scheme, duty was to be paid monthly in two instalments. The first instalment was on 10th of the month and the second instalment was to be paid by the last day of the month. Ld. DR submits that in terms of the compounded levy, the appellant was required to deposit the duty for the full month which he did not do and therefore, the demand has rightly been raised and confirmed.
5. We have heard the rival submissions. We note that the appellant opted for payment of duty in terms of Sub-rule (3) of Rule 96ZP. We further note that in terms of this rule, duty was required to be paid on monthly basis. Therefore, in terms of this Rule, the appellant should have deposited duty for the whole month even if his factory started working w.e.f. 17-11-97 and in case the factory was closed for more man 7 days, he was entitled to claim abatement of duty for the period during which the factory remain closed. Having regard to this legal position, we find no merits in this appeal. The appeal is, therefore, rejected.