2008 (8) TMI 940 - AT - Central Excise

Summary

Issues: Duty liability under Compounded Levy Scheme for production of stainless steel articles alongside non-alloy steel.

In this case, the primary issue revolved around the duty liability of the appellant for producing stainless steel articles alongside non-alloy steel under the Compounded Levy Scheme. The appellant contended that they predominantly manufactured goods covered by the Compounded Levy Scheme, citing previous Tribunal decisions in similar cases. The appellant's advocate highlighted that the duty liability should be discharged under the Compounded Levy Scheme if the items covered by the scheme predominate over others, referencing specific Tribunal cases for support. The Tribunal noted that in the stay order, it was recorded that only a small quantity of stainless steel was produced compared to non-alloy steel, indicating predominance of goods under the Compounded Levy Scheme.

The Tribunal considered the arguments presented by both sides and referred to previous Tribunal decisions, including Bhawani Shankar Castings Ltd. v. C.C.E., Chandigarh and Shree Venkatesh Steel Ltd. v. Commr. of C.E., Raigad. Based on the precedents and the predominant production of goods under the Compounded Levy Scheme by the appellant, the Tribunal concluded that the duty paid by the appellant for stainless steel under the Compounded Levy Scheme was appropriate. Consequently, the impugned order demanding duty under the normal scheme was deemed unsustainable, leading to the setting aside of the impugned order and allowing the appeal in favor of the appellant.

The judgment, delivered by Dr. Chittaranjan Satapathy, Member (T), and Shri D.N. Panda, Member (J), emphasized the importance of determining duty liability based on the predominance of goods covered by the Compounded Levy Scheme when assessing production involving multiple types of goods. The decision provided clarity on the duty payment requirements for cases where goods under different schemes are produced simultaneously, ensuring consistency in duty assessment and compliance with relevant provisions of the Central Excise Act.