2002 (5) TMI 567 - AT - Central Excise

Summary

Issues:
1. Challenge against Order-in-Appeal No. 85-86(KDT)C.E./JPR-1(41-42)/2001 and Order-in-Appeal No. 211(KDT)C.E./JPR-1(121)/200l.
2. Calculation of Central Excise Duty on Nylon Cord Yarn.
3. Imposition of penalty under Rule 173Q of the Central Excise Rules, 1944.

Analysis:
1. The appellant contested Order-in-Appeal No. 85-86(KDT)C.E./JPR-1(41-42)/2001 and Order-in-Appeal No. 211(KDT)C.E./JPR-1(121)/200l. The first order affirmed the findings of the adjudicating authority, leading to dismissal of the appellant's appeals. The second order affirmed the assessment for considering the availability of Notification No. 67/95-C.E., dated 16-3-95, and remanded the matter for requantification. The appellant's counsel informed that the adjudicating authority issued orders post-remand in compliance with the directions in the impugned order.

2. The dispute centered around the clearance of Nylon Cord Yarn used for manufacturing Tyre Cord Fabrics. A show cause notice demanded Central Excise Duty of Rs. 34,04,455/- for underpayment during Sept. 1994 to Jan. 1995 on Nylon Cord Yarn cleared for further manufacturing at lower prices than goods for home consumption. The Commissioner (Appeals) upheld the duty demand and imposed a penalty under Rule 173Q of the Central Excise Rules, 1944.

3. The appellants argued that the duty demand calculation in the show cause notice was erroneous, as it only mentioned 1260 denier, while the order affirmed the demand on Tyre Cord to 840, 1260, and 1680 deniers. The Tribunal rejected this contention, stating that 1260 denier was an example in the notice. The method of calculating duty based on prices for goods cleared for home consumption was deemed lawful. The Tribunal upheld the duty demand finding but overturned the penalty imposition, citing no evidence of willful evasion by the assessee.

In conclusion, the Tribunal affirmed the duty demand but set aside the penalty imposition under Rule 173Q. The impugned order dated 23-4-2000 was upheld regarding valuation, while the remand portion was deemed infructuous, leading to the dismissal of one appeal.