2005 (4) TMI 480 - AT - Central Excise

Summary

Issues:
1. Dispensing with the pre-deposit of duty amount confirmed against the appellants.
2. Adoption of subsequently fixed annual capacity of production for duty calculation.
3. Validity of the duty quantification based on the Commissioner's ACP fixation.

Analysis:
1. The appellants sought dispensation of the pre-deposit of duty amount of Rs. 71,050 confirmed for the period December 1998 to June 1999, along with a personal penalty of Rs. 30,000. The duty was confirmed due to the annual capacity of production (ACP) fixed by the Commissioner under the Central Excise Act, 1944. The appellants did not challenge the ACP fixation initially, leading to its finality.

2. The consultant for the appellants acknowledged the duty liability arising from the ACP fixed by the Commissioner at 2048 MTs. However, after the factory was sold to another entity, the Commissioner revised the ACP to 1234 MTs for the new owner. The appellants argued that the revised ACP should be considered for duty calculation from April 1999 to June 1999, implying the initial ACP was incorrect.

3. The Departmental Representative contended that the duty confirmation was a result of the quantification based on the accepted ACP during the relevant period, which had attained finality. The Tribunal agreed with the Department's stance, noting that the duty amount was confirmed solely as per the ACP fixed by the Commissioner. The appellants were directed to deposit the entire duty amount within eight weeks, considering their lack of a prima facie case against following the Commissioner's ACP order. The Tribunal also stayed the penalty recovery during the appeal process.

In conclusion, the judgment upheld the duty confirmation based on the initial ACP fixation by the Commissioner, rejecting the appellants' plea to consider the subsequently revised ACP for duty calculation. The appellants were directed to deposit the full duty amount within a specified timeframe, emphasizing the finality and binding nature of the original ACP determination.