2005 (6) TMI 546 - Commission - Central Excise

Issues Involved:
1. Whether the yearly 'declaration' filed by a small-scale manufacturer can be treated as a 'return' under Section 32E(1) of the Central Excise Act, 1944.
2. Whether a consolidated return filed just before filing the application or along with the application by a person who is not registered with Central Excise and did not obtain ECC Number can be considered as satisfying the condition in Clause (a) of Section 32E(1) of the Central Excise Act, 1944.
3. Can returns filed after obtaining ECC Code, but for the period prior to obtaining such Code Number, be treated as valid returns as per Section 32E(1) of the Central Excise Act, 1944.
4. Whether a limited company or partnership firm having two divisions at two different locations, one of which pays duty and files returns and another neither pays duty nor files returns, can be said to have complied with the conditions of filing the returns as per Section 32E(1) of the Central Excise Act, 1944.
5. Whether applications filed by units, which had functioned as SSI units, but had not even filed declarations during the material period would be eligible for admission.
6. Whether non-filing of declaration renders the applicant ineligible for filing an application for settlement when the practice of filing declaration upon commencement of manufacturing operation and every financial year was dispensed with by Notification No. 52/98-C.E. (N.T.), dated 2-6-1998.

Detailed Analysis:

Issue 1: Yearly Declaration as a Return
The Special Bench concluded that a yearly declaration filed by a small-scale manufacturer can be treated as a 'return' under Section 32E(1) of the Central Excise Act, 1944. The declaration contains basic particulars of estimated production and clearances, which keeps the Department aware of the bona fide existence of the applicant. Therefore, it serves the purpose of a 'return' for the application under Section 32E(1).

Issue 2: Consolidated Return Filed Before or Along with Application
The Bench held that a consolidated return filed just before filing the application or along with the application by a person who is not registered with Central Excise and did not obtain ECC Number cannot be considered as satisfying the condition in Clause (a) of Section 32E(1) of the Central Excise Act, 1944. The consolidated return cannot provide accurate details of duty paid in the prescribed manner, and the production and clearance details may be questionable.

Issue 3: Returns Filed After Obtaining ECC Code
Returns filed after obtaining ECC Code, but for the period prior to obtaining such Code Number, cannot be treated as valid returns as per Section 32E(1) of the Central Excise Act, 1944. However, if the applicant voluntarily filed monthly/quarterly returns even if late but before the commencement of any inquiry or issuance of a SCN, such returns can be considered valid for the purpose of Section 32E(1).

Issue 4: Compliance by Divisions of a Company/Firm
A limited company or partnership firm having two divisions at two different locations, one of which pays duty and files returns and another neither pays duty nor files returns, cannot be said to have complied with the conditions of filing the returns as per Section 32E(1) of the Central Excise Act, 1944. Each division must independently comply with the requirement of registration and filing returns.

Issue 5: Eligibility of Applications by SSI Units Without Declarations
Applications filed by units, which had functioned as SSI units but had not even filed declarations during the material period, would not be eligible for admission. Filing the prescribed declaration before the intervention of Revenue authorities is mandatory.

Issue 6: Non-Filing of Declaration and Eligibility
Non-filing of declaration does not render the applicant ineligible for filing an application for settlement if the declaration had been filed at the appropriate time as required under Notification No. 52/98-C.E. (N.T.), dated 2-6-1998.

Conclusion
The Special Bench directed the Additional Bench, Mumbai, to dispose of the application of M/s. Emerson Electric Company (India) Private Ltd. in accordance with the above findings.

← Previous Next →