2012 (11) TMI 908 - AT - Central Excise

Determination of capacity - appellant wrote to the Department vide their letter dated 8-3-98 intimating that they have carried out certain changes in the parameters of their mill and the capacity should be accordingly re-determined - intimation was received in the office of Commissioner on 2-1-1998 since the capacity was required to be intimated to the Commissioner in his office for which the changed capacity will be available Held that - If the re-determination of capacity is on deeming basis then it should be effective from one month from a 8-3-1998. - in the present case the action was taken approximately after 7 months. - Therefore, the case law cited by the Department is not relevant to this case. The deeming effect should have been one month from the date of initial intimation by the appellant i.e. 8-3-1998 which we accordingly hold.

Summary

Issues:
- Appeal against determination of annual capacity under Re-Rolling Steel Mills Annual Capacity Determination Rules, 1997.
- Dispute over the effective date for re-determination of capacity.
- Interpretation of relevant case laws for determining the effective date.

Analysis:
1. The appellant filed an appeal against the order determining their annual capacity under the Re-Rolling Steel Mills Annual Capacity Determination Rules, 1997. The appellant had initially applied for determination under these rules, and subsequent changes in parameters led to a re-determination of the annual capacity. The appellant contended that despite informing the Department of the changes on 8-3-98, the capacity was re-determined with deemed effect from 14-9-98, causing them to appeal the decision.

2. The main issue revolved around the effective date for re-determination of capacity following the appellant's intimation of parameter changes on 8-3-98. The appellant argued that the effective date should be one month after their intimation, based on their continuous follow-up with the Department. They relied on various case laws to support their contention, emphasizing the need for a fair and reasonable effective date considering the circumstances.

3. The Tribunal carefully examined the submissions and records, noting the appellant's timely intimation and follow-up actions. It was observed that the Department did not dispute the receipt of the intimation nor provide any adverse findings on the matter. Drawing from precedent, the Tribunal emphasized the importance of the date of intimation for determining the effective date of re-determination. The Tribunal differentiated the present case from the case law cited by the Department, highlighting the delay in action taken by the Department in this instance.

4. Ultimately, the Tribunal held that the effective date for re-determination of capacity should be one month from the date of the initial intimation by the appellant, i.e., 8-3-98. In light of this finding, the Tribunal set aside the ld. Commissioner's order and allowed the appeal in favor of the appellant. The decision was based on a thorough analysis of the facts, relevant case laws, and the principles of fairness and timeliness in administrative actions.