2004 (2) TMI 620 - AT - Central Excise

Summary

Issues:

1. Appeal against order-in-appeal passed by Commissioner (Appeals) regarding refund claim under Compounded Levy Scheme.
2. Entitlement of refund for duty paid during the period the stenter remained closed.
3. Interpretation of Rule 96ZQ of the Central Excise Rules, 1944 regarding abatement of duty for closed stenter.
4. Applicability of previous Tribunal decision in Jupiter Industries case.

Analysis:

The appellants, an independent processor under the Compounded Levy Scheme, filed an appeal against the order-in-appeal by the Commissioner (Appeals) concerning a refund claim for the period when their stenter remained closed. The appellants sought a refund of duty paid during this period, citing the closure of the stenter as the reason. However, the adjudicating authority rejected the refund claim, stating that it was not permissible under the Compounded Levy Scheme. The appeal filed by the appellants was also dismissed.

The appellants contended that they had sought permission to dismantle and replace old chambers of the stenter, which was granted by the Assistant Commissioner of Central Excise. They informed the Revenue Authorities about the dismantling and replacement process through various letters. After completing the necessary repair/replacement work, they requested sealing of the chambers. The appellants maintained that since the stenter remained closed during the specified period, they were entitled to a refund of the duty paid.

In considering the arguments, the Tribunal referred to Rule 96ZQ of the Central Excise Rules, 1944, which does not explicitly provide for a refund of duty but allows for abatement of duty for the period the stenter remains closed, subject to fulfilling certain conditions. The Tribunal noted that the appellants had provided ample evidence, including letters, demonstrating the closure of the stenter during the relevant period. Consequently, the Tribunal held that the appellants were entitled to abatement of duty for the period in question. The Tribunal directed the adjudicating authority to treat the refund claim as an abatement claim and consider the appellant's request in accordance with the law, providing an opportunity for a hearing. As a result, the appeal was disposed of by way of remand, allowing the appellants a chance to present their case for abatement of duty.