2004 (3) TMI 715 - HC - Central Excise

Summary

Issues:
- Application under Section 35(H) of the Central Excise Act, 1944 for direction to refer questions of law arising out of Tribunal's decision.
- Interpretation of liability to pay 8% of the price of excisable goods under Rule 57CC(1) of Central Excise Rules, 1944.
- Consideration of recovery provisions under Section 11 and Section 11A of the Central Excise Act, 1944.
- Compliance with Rule 57CC(1) for adjustment of credit and liability for non-payment.

Analysis:
The judgment involves an application by the Commissioner of Central Excise and Customs under Section 35(H) of the Central Excise Act, 1944, seeking a direction to the Appellate Tribunal, Kolkata to refer questions of law arising from the Tribunal's decision. The questions raised include whether the liability to pay 8% of the price of excisable goods under Rule 57CC(1) is Modvat credit or duty, the Tribunal's error in setting aside the recovery order, interpretation of Central Excise Acts and Rules regarding recovery of adjudicated amounts, and the consequences of non-compliance with Rule 57CC(1) for credit adjustment.

The counsel for the applicant argued that the Tribunal's decision raises the issue of whether liability can be enforced without specific rules for recovery. On the other hand, the respondent's counsel contended that the Tribunal followed the Bombay Bench's view, which was upheld by the Supreme Court, indicating no need for a reference. However, after considering the arguments and Tribunal's reasoning, the Court found it necessary to compel the Appellate Tribunal to refer the questions to the Court for decision. Consequently, the Court allowed the application and directed the Appellate Tribunal to refer the questions to the Court in accordance with Section 35(H) of the Central Excise Act, 1944.

In conclusion, the judgment addresses crucial issues regarding the interpretation of liability under Rule 57CC(1), the applicability of recovery provisions in the Central Excise Act, and the necessity for compliance with credit adjustment rules. The Court's decision to compel a reference underscores the significance of clarifying these legal aspects for proper enforcement and understanding of excise laws and rules.