2006 (10) TMI 271 - AT - Central Excise

Summary

Issues:
1. Dismissal of appeals against orders confirming demand for duty and interest.
2. Applicability of compounded levy scheme for discharge of Central Excise duty liability.
3. Challenge to capacity determination order and subsequent re-determination.
4. Invocation of extended period of limitation under Section 11A.
5. Liability to pay interest on delayed payments as per Rule 96ZP.
6. Contention regarding limitation for issuance of show cause notice under Section 11A.

Analysis:

1. The appeal was filed against the order-in-appeal dismissing appeals challenging demand for duty and interest confirmed under two show cause notices. The appellant, a manufacturer of non-alloy steel products, opted for the compounded levy scheme under Rule 96ZP for duty discharge. The Commissioner determined monthly duty liability based on capacity determination, leading to outstanding duty demands.

2. The appellant contested the demand, arguing against the sustainability of the demand and penalty provisions. The capacity determination order was challenged and subsequently re-determined by the Commissioner. The Deputy Commissioner found the appellant in contravention of duty payment provisions under Section 3A and Rule 96ZP, invoking the extended limitation period for demand confirmation.

3. The Deputy Commissioner confirmed the outstanding duty demands under show cause notices, directing interest payment at 18% on delayed payments. The Commissioner (Appeals) upheld the duty liability based on the capacity determination order, rejecting appellant's contentions regarding interest chargeability and penalty imposition.

4. The liability to pay interest on delayed payments was governed by Rule 96ZP, mandating interest payment at 18% calculated from the due date till actual payment. The Commissioner correctly applied this provision, dismissing appellant's objections against interest payment.

5. The appellant raised a contention on limitation for the issuance of show cause notices under Section 11A. Despite the appellant's evasion of duty payment, the extended limitation period was justified. The decision in Mohinder Steels Ltd. case supported the application of specific time limits for different schemes under Section 11A.

6. The appellate order upheld the impugned decision, dismissing all contentions raised by the appellant. The appeal was ultimately dismissed, affirming the demand for duty and interest as per the compounded levy scheme and statutory provisions.

This detailed analysis covers the issues involved in the legal judgment, providing a comprehensive overview of the case and the reasoning behind the decisions made by the authorities.