2003 (3) TMI 660 - Commission - Central Excise

Issues Involved:
1. Eligibility for exemption under Notification 108/95-C.E.
2. Interpretation of "case" under Section 31 of the Central Excise Act (CEA), 1944.
3. Pendency of proceedings before Central Excise Officers (CEO) or Central Government.
4. Demand for interest under Section 11AB of CEA, 1944.
5. Applicability of Settlement Commission jurisdiction.

Issue-wise Detailed Analysis:

1. Eligibility for exemption under Notification 108/95-C.E.:
The applicant, a manufacturer of transformers, availed exemption under Notification 108/95-C.E. for goods supplied to a project financed by M/s. Japan Bank for International Co-operation (JBIC). The exemption was challenged by the Revenue on the grounds that JBIC was not notified as an International Organisation under Section 3 of the UN (Privileges and Immunities) Act, 1947. Consequently, the project authority cancelled the certificate that initially stated the project was financed by JBIC. The applicant had already paid Rs. 87,71,852/- towards duty liability voluntarily.

2. Interpretation of "case" under Section 31 of the Central Excise Act (CEA), 1944:
The crux of the applicant's argument revolved around the interpretation of "case" under clause (c) of Section 31 of the CEA, 1944. The applicant's Advocate argued that the definition of "case" includes any proceeding for levy, assessment, and collection of excise duty, and that the condition of pendency applies only to appeal or revision proceedings. The Bench, however, disagreed, stating that the condition of pendency applies to both original and appellate/revisionary proceedings.

3. Pendency of proceedings before Central Excise Officers (CEO) or Central Government:
The applicant contended that since the enforcement of interest under Section 11AB and potential prosecution under Section 9 were still pending, the proceedings were still active. The Revenue countered that no proceedings were pending as the case had been adjudicated by the Commissioner, and no appeal was filed before the CEGAT. The Bench supported the Revenue's stance, concluding that no proceedings were pending before any CEO or Central Government.

4. Demand for interest under Section 11AB of CEA, 1944:
In the adjudication order, the Commissioner confirmed the duty demand and appropriated the amount already paid by the applicant. The Commissioner also held that interest was chargeable under Section 11AB of the CEA, 1944. The Bench noted that since no appeal was filed against this order, the demand for interest had become final.

5. Applicability of Settlement Commission jurisdiction:
The Bench examined whether the Settlement Commission had jurisdiction to entertain the application. It was concluded that since the case had already been adjudicated and no appeal was filed, no proceeding was pending before any CEO or Central Government. The Bench referred to a similar case adjudicated by the Principal Bench of the Settlement Commission, which reinforced that the condition of pendency applies to both original and appellate/revisionary proceedings. Consequently, the Bench rejected the application, stating that it did not pertain to a "case" within the meaning of clause (c) of Section 31 of the Act.

Conclusion:
The application was rejected as it did not meet the criteria of a pending "case" under Section 31 of the CEA, 1944. The Bench emphasized that the condition of pendency applies to both original and appellate/revisionary proceedings, and since no proceedings were pending, the Settlement Commission could not entertain the application.

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