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2010 (7) TMI 360 - AT - Central ExciseAppeal to Tribunal - COD clearance - noting on record to disclose any justification for non-availability of COD clearance - absence of COD clearance for 5 years appeal was already filed before the Tribunal - Failure to obtain COD clearance for the last five years also cannot be a justification for dismissal of the appeal involving a meritorious ground for setting aside the order passed by the lower Authority and that too involving the revenue to the Government - finding arrived at by the Commissioner (Appeals) about bar of limitation is apparently contrary to the records - Tribunal cannot be a silent spectator to the lethargic attitude on the part of the Department and the Committee dealing with the clearances to be issued to the Department for filing the appeals - request for adjournment on the ground of absence of COD rejected - order passed by the Commissioner (Appeals) set aside - order passed by the Adjudicating Authority restored Appeal disposed of
Issues:
1. Bar of limitation in demand for exemption on waste and scrap. 2. Validity of COD clearance requirement. 3. Allegation of suppression of facts in form EA-3. Analysis: Issue 1: Bar of limitation in demand for exemption on waste and scrap The appeal arose from an order passed by the Commissioner (Appeals) setting aside the order of the adjudicating authority due to the demand being barred by the law of limitation. The Commissioner (Appeals) confirmed the finding of the Adjudicating Authority regarding non-entitlement of exemption on waste and scrap generated during the manufacture of goods. The Adjudicating Authority had previously denied the benefit of the exemption notification to the respondents, leading to a demand and penalty imposition. The Commissioner (Appeals) based the limitation bar on the period of the matter being from January 2002 to March 2003, while the show cause notice was issued in June 2003, not in June 2004 as incorrectly stated. The Tribunal found the Commissioner's finding on the limitation bar unsustainable, as the show cause notice was actually issued in June 2003, well within the required time frame. The appeal was allowed, and the order of the Commissioner (Appeals) was set aside. Issue 2: Validity of COD clearance requirement The respondents, a Public Limited Company, were required to obtain COD clearance due to their shareholding structure. The absence of COD clearance was acknowledged, and the Department's request for an adjournment based on this ground was rejected. The Tribunal noted that the appeal was filed in 2005, and the absence of COD clearance for five years was not a justifiable reason to dismiss the appeal or adjourn it indefinitely. The reasonable period for obtaining COD clearance was defined as three to six months, and the Tribunal proceeded to decide the matter on merits despite the lack of COD clearance. The Tribunal emphasized that the Department's delay in obtaining COD clearance should not hinder the resolution of meritorious appeals involving revenue implications. Issue 3: Allegation of suppression of facts in form EA-3 The cross objections filed by the respondents alleged suppression of facts by the appellants in form EA-3 without providing specific details to support the claim. Additionally, the cross objections raised concerns about the absence of COD clearance, which was necessary due to the respondents' status as a Public Limited Company with Central Government shareholding. The Tribunal rejected the cross objections and upheld the order passed by the Adjudicating Authority, emphasizing the importance of addressing meritorious grounds and not dismissing appeals based on procedural delays. In conclusion, the Tribunal allowed the appeal, rejected the cross objections, set aside the Commissioner (Appeals) order, and restored the Adjudicating Authority's decision. The judgment highlighted the significance of timely actions, adherence to legal requirements, and the need to focus on substantive merits rather than procedural delays in resolving legal disputes.
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