2007 (10) TMI 5 - SC - Central Excise

Department contended that deemed annual production would be determine by the capacity of the furnace but appellant can t agreed with it - Tribunal has confirmed the view of the department. High Court rejected the appeal since no question of law is involved. SC confirms HC view.

Summary

Issues:
- Determination of deemed annual production under Section 3A of the Central Excise Act, 1944.

Analysis:
1. The appellant installed an induction furnace with an 8 M.Ts capacity but could only obtain 1900 KVA input of power from the Gujarat State Electricity Board (Board), leading to a reduction in capacity to 4 = M.Ts. The appellant claimed to have informed the authorities about this change, supported by a certificate from M/s. Furcon Consultancy Services. Despite this, a show cause notice was issued based on the original 8 M.Ts capacity, leading to a dispute on the deemed annual production calculation.

2. The appellant argued that the reduction in furnace capacity was necessitated by the inability of the Board to supply the required power, as evidenced by letters and certificates. However, the respondent contended that the modification of the furnace capacity was irrelevant, and only the installed capacity should be considered for determining deemed annual production. The appellant's assertion of informing the authorities about the changes was supported by documentary evidence, which the respondent disputed.

3. The Tribunal examined the factual aspects of the case, including physical verification of the furnace parameters and actual production records. Various witnesses provided statements, with discrepancies noted in the certification process and the claimed modification of the furnace. The Tribunal's detailed order considered all contentions and found that the actual production aligned more closely with the original 8 M.Ts capacity, leading to the dismissal of the appellant's appeal.

4. The Tribunal's decision was based on factual findings and interpretation of relevant rules under the Central Excise Act. The appellant's arguments regarding the change in furnace capacity and its impact on deemed annual production were not accepted, as the Tribunal emphasized the importance of installed capacity for such determinations. The High Court upheld the Tribunal's decision, stating that no substantial question of law arose for consideration, in line with Section 35G of the Central Excise Act.

5. Ultimately, the appeal was dismissed by the Supreme Court, affirming the lower courts' findings. The Court concluded that no legal infirmity existed in the judgments, as no substantial question of law was identified for further consideration. The detailed factual analysis and interpretation of relevant legal provisions led to the dismissal of the appeal without costs.