2016 (2) TMI 1036 - AT - Central Excise

Non-payment of duty for the month of March 2000 - demand - manufacturer of M.S. Ingots - opted for payment of duty on the basis of capacity of production u/s 3A of the CEA 1944 - Held that - in Rule 96ZO(3) of the Central Excise Rules 1944 detailed procedure has been prescribed for claiming the abatement of duty in case assessee does not manufacture the goods during any continues period of more than seven days - appellant have not followed any procedure rather their averment regarding the break down of plant was made only in the hearing during the adjudication process - demand upheld - appeal dismissed - decided against assessee.

Summary

Issues:
Appeal against Order-in-Appeal No. BR/10/Th-I/2005 confirming duty and penalty for non-payment in March 2000. Appellant's factory closed in March, reopened in June, but no abatement procedure followed. Appellant's claim rejected by Adjudicating authority and Commissioner (Appeals).

Analysis:
The case involves an appeal against the confirmation of duty and penalty for non-payment of Central Excise duty in March 2000. The appellant, engaged in manufacturing M.S. Ingots, opted for duty payment based on production capacity under Section 3A of the Central Excise Act, 1944. A show cause notice was issued due to non-payment of duty amounting to Rs. 8,33,334 for March 2000. The duty was confirmed, and a penalty of equal amount along with interest was demanded. The appellant's appeal before the Commissioner (Appeals) was rejected, leading to the current appeal.

Despite repeated notices, no one appeared on behalf of the appellant during the proceedings. The Tribunal was left to decide the matter based on the available records. The Revenue, represented by Shri N.N. Prabhudesai, argued that the appellant's factory was closed for the entire month of March, reopening in June, but failed to follow the prescribed procedure for claiming abatement under Rule 96ZO(3) of the Central Excise Rules, 1944. The appellant's submission during the hearing without following the proper procedure was deemed insufficient by the Revenue.

Upon review of the submissions and records, the Tribunal found that the demand was confirmed due to non-payment of duty for March 2000. The appellant belatedly informed about the plant breakdown on 10-3-2000 for the period 1-3-2002 to 6-3-2000. However, the appellant did not apply for abatement to the competent authority as required by Rule 96ZO(3). The Tribunal noted that the appellant failed to follow the detailed procedure prescribed for claiming abatement when the factory remains closed for more than seven days. As the appellant did not adhere to the prescribed rules and only raised the issue during the adjudication process without filing for abatement, the demand was upheld by the Adjudicating authority and Commissioner (Appeals).

Ultimately, the Tribunal found no reason to interfere with the impugned order and upheld the decision to dismiss the appeal. The judgment was pronounced in court on 15-2-2016.