2008 (6) TMI 397 - AT - Central Excise

Summary

Issues:
1. Mistakes apparent on record in the order dated 29-2-2008.
2. Claim of clearing cement without payment of Central Excise duty under Rule 96ZV.
3. Discrepancies in the procedure for receiving damaged cement and the quantum of recoverable cement.
4. Appeal against the demand and penalty imposed by the original authority and Commissioner (Appeals).
5. Interpretation of the Chemical Examiner's report on the setting properties of cement.
6. Eligibility of the appellant for the benefit under Rule 96ZV.

Analysis:

Issue 1:
The judgment highlighted mistakes apparent on record in the order dated 29-2-2008, where only details of one appeal were discussed while others were not mentioned. Consequently, in the interest of justice, the order was recalled, and all appeals were restored to their original numbers for re-hearing.

Issue 2:
The appellant cleared 957.63 MT of cement without paying Central Excise duty, claiming entitlement under Rule 96ZV for reprocessing damaged cement brought into the factory earlier. The original authority and Commissioner (Appeals) found discrepancies in the procedure for receiving damaged cement and the recoverable quantity, leading to a demand of Rs. 3,35,171/- and a penalty. The Tribunal re-evaluated the case.

Issue 3:
The appellant's advocate argued that the quality of the cement after reprocessing met standards, and the Chemical Examiner's reliance on a tour note from another company was irrelevant. The Chemical Examiner's report mentioned setting properties, but the Tribunal clarified that this did not mean the cement had irreversibly set. The appellant's reprocessing method was deemed feasible, allowing for the recovery of 100% of the damaged cement by weight.

Issue 4:
The Tribunal disagreed with the Commissioner (Appeals) and the original authority, holding that the appellant was eligible for the benefit under Rule 96ZV. The Tribunal noted that the quantities cleared subsequently were equal to those cleared earlier on payment of duty, supporting the appellant's claim for reprocessing and duty-free clearance.

Conclusion:
The Tribunal allowed the appeals, granting the appellant consequential relief based on the re-evaluation of the case and the eligibility of the appellant for the benefit under Rule 96ZV. The decision emphasized the feasibility of the reprocessing method and the permissibility of duty-free clearance for the reprocessed cement, overturning the previous demands and penalties imposed.