2005 (7) TMI 600 - AT - Central Excise

Summary

Issues:
1. Duty on gases vented out due to technological necessity.
2. Applicability and binding nature of Board's Circular on the duty liability.
3. Commissioner's findings and application of judgments.

Analysis:
1. The case involved the appellant, a manufacturer of Oxygen, Nitrogen, and Argon, who was required to pre-deposit a significant amount due to the duty charged on gases vented out into the atmosphere as a result of technological necessity. The appellant argued that no duty should be levied on gases that escaped into the atmosphere by flare system or otherwise. The appellant relied on Board's Circular No. 46/80/96-CX, dated 1-10-1996, which clarified that no duty is required to be discharged in such circumstances. The Commissioner had not followed this Circular and had distinguished it in the assessment.

2. The learned Senior Counsel emphasized the binding nature of the Board's Circular on the authorities, citing the decision of the Apex Court in the case of CCE, Vadodara v. Dhiren Chemical Industries. The JCDR acknowledged the position regarding the Circular's applicability but reiterated the Commissioner's findings. Upon careful consideration, the Tribunal found that the Board's Circular was indeed applicable to the facts of the case. It was emphasized that the Circulars are binding on the authorities, even if they do not align with the tariff or citations. The Commissioner's attempt to apply the ratio of various judgments was deemed irrelevant to the case's circumstances.

3. The Tribunal ruled in favor of the appellant, granting a total waiver of the duty and penalty. It was decided that there would be no pre-deposits required, and the Revenue was not allowed to recover the amount. The decision was based on the fact that the issue was fully covered by the Board's Circular in favor of the appellant, and considering the substantial revenue involved in the matter. The appeal was scheduled for final hearing on a specified date.

This comprehensive analysis of the judgment highlights the key issues of duty liability on vented gases, the significance of the Board's Circular, and the Tribunal's decision in favor of the appellant based on the Circular's binding nature and applicability to the case.