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2002 (1) TMI 519 - AT - Central Excise
Issues:
Applications for waiver of pre-deposit - Duty and Penalty - Manufacturing of goods - Reprocessing of goods - Central Excise duty liability - Benefit of Notification No. 217/86 - Relevant legal provisions and circulars - Prima facie case for waiver. Analysis: The case involved two applications by M/s. ICI India Ltd. seeking waiver of pre-deposit concerning duty and penalty amounts. The appellant, represented by Shri A.R. Madhav Rao, Advocate, argued that the goods manufactured, packed, and entered in the RG-1 register were later found not meeting buyer specifications and were taken for reprocessing with suitable entries made in the register. The Commissioner demanded duty for specific periods, but the appellant claimed the benefit of notifications allowing duty-free reprocessing within the factory premises. The appellant cited legal precedents like M/s. Shakti Iron and Steel Co. Ltd. and U.P. State Sugar Corporation Ltd. to support their case. On the other hand, Shri A.K. Jain, SDR for the respondent, contended that once goods are entered in RG-1, they can only be removed upon payment of Central Excise duty. The respondent argued that the reprocessing claim lacked proper procedures and doubted the actual reprocessing of goods without proper identification of defects. Legal precedents such as CCE v. Supreme Industries were cited to highlight the importance of informing the department about goods' removal for reprocessing, which the appellant allegedly failed to do. After considering both sides' submissions, the tribunal noted the appellant's documentation showing movement of goods for reprocessing and their return, along with entries in the RG-1 register. The tribunal also acknowledged the Commissioner's previous decision to grant the benefit of Notification No. 217/86 based on similar circumstances. Consequently, the tribunal found a strong prima facie case in favor of the appellant and stayed the recovery of duty and penalty pending final hearing scheduled for 27-2-2002.
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