2005 (8) TMI 498 - AT - Central Excise

Issues:
1. Appeal against Order-in-Original No. 3/2003 regarding duty liability under Central Excise Act, 1944.
2. Claim for abatement under Section 3A(3) and Rule 96ZO(2) of the Central Excise Rules, 1944.
3. Denial of abatement by the Commissioner based on Rule 96ZO(2) conditions.
4. Intimation of factory closure and re-starting to the Assistant Commissioner and Superintendent of Central Excise.
5. Justification of abatement denial based on closure intimation timing.

Detailed Analysis:
1. The appeal before the Tribunal was against Order-in-Original No. 3/2003 passed by the Commissioner of Customs & Central Excise, Calicut, regarding duty liability under the Central Excise Act, 1944. The appellants were paying duty based on their Annual Capacity of Production as per Section 3A of the Act and Rule 96ZO of the Central Excise Rules, 1944.

2. The appellants applied for abatement from duty amounting to Rs. 5,28,605 under Section 3A(3) and Rule 96ZO(2) of the Central Excise Rules, citing factory closures on four occasions. However, the Commissioner rejected the abatement claim, stating that the appellants did not fulfill the conditions prescribed under Rule 96ZO(2), leading to the appeal before the Tribunal for relief.

3. The learned Advocate for the appellants argued that they had complied with the requirements of Rule 96ZO(2) by providing closure intimation to the Assistant Commissioner and the Superintendent of Central Excise either before or on the date of closure. The denial of abatement was based on the timing of closure intimation received by the Assistant Commissioner's office, which was later than the Superintendent's office. The Advocate contended that the delay was due to the office practice of depositing letters in a box, opened the next day, and emphasized that all necessary information was promptly provided to the Superintendent.

4. The Tribunal considered the submissions from both sides and reviewed the case records. It was noted that the closure and re-starting intimation, including relevant details like electricity meter readings and stock balances, were sent to both the Assistant Commissioner and the Superintendent of Central Excise. While the closure intimation was received late in the Assistant Commissioner's office in some cases, it was timely in the Superintendent's office, situated in the same premises. Therefore, the Tribunal held that the conditions of Rule 96ZO(2) were met, and the denial of abatement based on closure timing was unjustified.

5. Consequently, the Tribunal allowed the appeal, granting the appellants the relief sought regarding the abatement from duty. The decision was based on the acknowledgment of timely intimation to the Superintendent of Central Excise, despite delays in the Assistant Commissioner's office, and the fulfillment of Rule 96ZO(2) requirements. The judgment was delivered in favor of the appellants, providing them with consequential relief.

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