Customs, Excise and Gold Tribunal - Hyderabad
Handum Iron And Steel Enterprises Ltd. vs Cce And C on 28 July, 1999
Equivalent citations: 2000(90)ECR345(TRI.-HYDERABAD)
ORDER V.K. Ashtana, Member (T)
1. For the purpose of hearing these two appeals, appellants are required to pre-deposit a sum of Rs. 33,74,600/- and interest as per order-in-original No. 4 & 5/99. dt. 11.2.1999 passed by Commissioner of Central Excise. The issue concerns the assessment to duty under Rule 96ZP (3).
2. Heard Shri S.S. Radhakrishnan, Ld. Advocate for applicants who submits that since the fact that their unit was closed was more than 7 days, therefore they had approached the jurisdictional Commissioner for refixing the annual capacity and therefore the duty payable under Section 3A of the Act. However, by the impugned order, the Ld. Commissioner has submitted that since they had also opted for payment of compounded system of duty under Rule 96ZP(3), therefore in terms of provisions of that Sub-rule that no benefit under Section 3A (3) etc. would be available if this option has been exercised, therefore the duty has been demanded and confirmed.
3. Ld. Advocate submits that this matter has been considered in great detail by the Hon'ble Delhi High Court in the case of Supreme Steels & General Mills v. UOI as . In the said judgement, the Hon'ble Delhi High Court had held that in the interest of justice and equity the operation of notification, inter alia, No. 44/97 dt. 30.8.1997 was stayed. Ld. Advocate further submits that me Union of India has agitated the matter before the Hon'ble Supreme Court of India against the said interim of order of the Hon'ble High Court as is reported in 1998 {77) ECR 41 (SC). The matter is sub judice before the Apex Court. Ld. Advocate therefore submits that judicial discipline requires that the stay of operation of the said notification which has introduced Sub-rule 3 in Rule 96ZP needs to be implemented in their case as the Hon'ble Supreme Court has not stayed the operation of the said interim order of Delhi High Court.
4. Heard Ld. DR Shri S. Kannan, who submits that the Hon'ble Supreme Court in its order dt. 21.4.1998 has directed that the Government shall not take any penal or coercive measures under the Notification No. 7/98-CE(NT) dt. 10.3.1998. The Hon'ble Apex Court has further observed that it will be open to the manufacturers to submit applications on the basis of the actual production and, if any such application is submitted the same shall be duly considered by the competent authority in accordance with the Rules. Ld. DR submits that this could be interpreted to mean that the fixation could be done in terms of Rule 96ZP(3).
5. We have carefully considered the rival submissions and records of the case. We find that since the matter lies on a short compass and is covered by the Judgment of the Hon'ble Delhi High Court supra, therefore we grant complete waiver and stay in the matter and proceed to consider the appeals themselves.
6. On a careful consideration of the submissions, we find that in the case of Supreme Steels & General Mills supra, the Hon'ble Delhi High Court in its interim Judgment has clearly stayed the operation of the notification No. 44/97-CE(NT). The effect of this order is that the operation of Rule 96ZP(3) is stayed. The order-in-original impugned has held that since appellants had opted for the procedure under this sub-rule, therefore their application for abatement of duty payable on days of closure in terms of Section 3A cannot be considered. However, we find that the order impugned has erred in this behalf in as much as that once the sub-rule itself has been stayed by the Hon'ble Delhi High Court, therefore the Ld. Commissioner was not having the legal authority to have taken such a view on the applicability of the Rule 96ZP(3).
7. We have also perused the order dt. 21.4.1998 of the Hon'ble Supreme Court of India in this matter. We find on a plain reading that Hon'ble Apex Court has not stayed the operation of the interim order of the Hon'ble Delhi High Court as far as notification No. 44/97 is concerned. On the contrary, the Hon'ble Apex Court has directed that if manufacturers submit applications for assessment on the basis of "actual production", same shall be considered as per law. This is exactly the subject matter of this appeal before us in as much as that appellants had submitted an application for deducting those period (of 7 days or more) where the factory had remain closed and therefore the average production for this period needed to be deducted to arrive at the deemed actual production. However, the order impugned had denied this request and instead confirmed the duty demand. Therefore, it is our considered opinion that since the said interim Judgment of the Delhi High Court has not been stayed by the Hon'ble Supreme Court, it continues to be operative and thus the position obtained is that operation of Rule 96 ZP(3) remands stayed. Under these circumstances, we find that interest of justice requires that order-in-original impugned is set aside and the matter remanded to the original authority for reconsideration in terms of the said Judgment of Hon'ble Delhi High Court read with the Judgment of the Hon'ble Supreme Court noted supra. Ordered accordingly.
8. Appeals succeed by way of remand accordingly.
(Pronounced and dictated in open court).