1984 (10) TMI 232 - AT - Central Excise

Summary

Issues:
1. Demand of differential duty on TOFS removal
2. Compliance with Chapter X of Central Excise Rules, 1944
3. Applicability of AR-3As for clearances
4. Interpretation of substantial compliance with Chapter X
5. Use of CT2 certificates for goods removal

Analysis:

1. The judgment deals with an appeal under Section 35B of the Central Excises and Salt Act, 1944 regarding the demand of differential duty on the removal of TOFS by the Assistant Collector of Central Excise. The Assistant Collector observed non-compliance with Chapter X of the Central Excise Rules, 1944, specifically related to Notification No. 287/79-C.E. The appeal was initially rejected by the Appellate Collector, leading to a revision application transferred to the Tribunal for consideration.

2. The appellant argued that substantial compliance with Chapter X procedures was met as the goods were received by parties holding L-6 licenses under CT2 certificates issued by jurisdictional officers. The Superintendents of Central Excise certified that the TOFS were used in the manufacture of transformer oil, demonstrating compliance with the required procedures.

3. The appellants contended that clearances were not made under AR-3As but through gate passes and invoices, which they argued was a customary practice not mandated by Chapter X. The Tribunal acknowledged this argument and did not consider the absence of AR-3As as a significant irregularity.

4. The appellants referenced previous Tribunal orders to support their claim of substantial compliance with Chapter X being sufficient for concession under the Rules. The Tribunal noted the precedents cited and agreed that the present case warranted admission based on the principle of substantial compliance with procedural requirements.

5. The judgment highlighted the importance of CT2 certificates in the procedure outlined by Chapter X of the Rules. The certificates serve as a means to notify the Department about the removal of excisable goods, ensuring proper transportation, storage, and utilization for approved purposes. The evidence presented, including CT2 certificates and certifications from Superintendents of Central Excise, indicated the satisfaction of the Department regarding the actual use of the removed goods for manufacturing transformer oil.

In conclusion, the Tribunal allowed the appeal, providing consequential benefits to the appellants based on the demonstrated compliance with essential procedures and the liberal interpretation of substantial compliance with Chapter X requirements.