2005 (11) TMI 296 - AT - Central Excise

Summary

Issues:
1. Stay application filed by the Appellant regarding duty and penalty imposition.
2. Interpretation of sub-rule (13) of erstwhile Rule 57T of the Central Excise Rules.
3. Confirmation of duty demand by the Commissioner.
4. Consideration of proviso attached to sub-rule (13) for duty on capital goods.
5. Compliance with essential conditions under Rule 57G for availing credit.
6. Remand of the matter to the Original Adjudicating Authority for further review.

Analysis:
1. The Appellant filed a stay application concerning duty of Rs. 9,90,823.00 and penalty of Rs. 5,000.00. The Appellant's representative argued that capital goods were used in manufacturing final products, challenging the Commissioner's confirmation of demand for Rs. 7.5 Lakhs. The Tribunal found a prima facie case in favor of the Appellant and granted a stay to decide the case finally.

2. The Tribunal examined sub-rule (13) of Rule 57T, which requires the Assistant Commissioner to ensure duty payment on capital goods used in manufacturing final products. The Commissioner confirmed the duty demand based on incomplete invoice descriptions, but failed to consider the proviso attached to sub-rule (13). The Tribunal emphasized the Assistant Commissioner's obligation to verify compliance with the proviso before denying credit.

3. The Commissioner's decision to confirm the duty demand of Rs. 7.5 Lakhs was based on incomplete invoice descriptions, overlooking the proviso to sub-rule (13). The Tribunal remanded the matter to the Original Adjudicating Authority to reassess compliance with the proviso and grant the Appellant the benefit if satisfied, emphasizing the need for a new order considering natural justice principles.

In conclusion, the Tribunal granted a stay on the duty and penalty, highlighting the importance of considering the proviso to sub-rule (13) for duty on capital goods and ensuring compliance with essential conditions under Rule 57G. The matter was remanded for a thorough review by the Original Adjudicating Authority to uphold fairness and justice in the decision-making process.