2015 (7) TMI 1147 - HC - Central Excise

Plea of the mistake - Compounded levy scheme - Notification No. 32/97-C.E. (N.T.), dated 1-8-97 in which the ACP is fixed on the parameters of d - Diameter 300 to below 350 and W at 2.47 Kg./Mtr., whereas the correct Notification No. 45/97-C.E. (N.T.), dated 30-8-97, provides for fixing the ACP on the basis of d - Diameter between 261 to 310 and the value of W is taken as 1.200 Kg./Mtr - Held that - Tribunal in the original order as also in the ROM application is on the wrong premise that no plea has been raised by the assessee with regard to change of parameters and the applicability of notification dated 30-8-97 - Decided in favor of the assessee.

Summary

Issues:
1. Whether a mistake pointed out in an application can be rejected by the Tribunal if not argued before it?
2. Can the Assistant Commissioner of Central Excise initiate recovery proceedings under the Compounded Levy Scheme?

Issue 1:
The appellant challenged the Tribunal's dismissal of their appeal and subsequent application. The appellant requested a revision of the Annual Capacity Production (ACP) due to errors in the furnace type and formula. The appellant argued that Notification No. 45/97-C.E. (N.T.) should be applied, impacting the ACP calculation. The Commissioner (Appeals) upheld the demand, leading to the Tribunal's decision against the appellant. The Tribunal primarily focused on whether the ACP was fixed provisionally or finally. The appellant's plea regarding the furnace type and parameter change was not adequately addressed by the Tribunal, leading to the appellant's appeal to the High Court.

Issue 2:
The appellant contended that recovery under the Compounded Levy Scheme could not be initiated using Section 11A, as the scheme is a separate entity. The Tribunal's failure to consider the lack of expert opinion on the furnace and the Notification No. 45/97-C.E. (N.T.) applicability was highlighted. The appellant argued that the Tribunal's decision was flawed and requested its reversal. The Department opposed interference with the Tribunal's order. The High Court noted the Tribunal's focus on the provisional ACP fixation issue but found the Tribunal's dismissal of the appellant's plea regarding parameter change and notification applicability incorrect. The High Court held in favor of the appellant, setting aside the Tribunal's orders and remanding the matter for fresh consideration.

This detailed analysis of the judgment addresses the issues involved comprehensively, outlining the legal arguments, Tribunal's decisions, and the High Court's final ruling.