2015 (10) TMI 1221 - AT - Central Excise

Determination of annual capacity of production - Held that - Issue is no more res-integra, in view of the decision of the Hon ble Gujarat High Court in the case of Krishna Processors vs Union of India 2012 (11) TMI 954 - GUJARAT HIGH COURT - Respectively following the decision of the Hon ble Gujarat High Court in the case of M/s Krishna Processors (supra), we set-aside the impugned order. - Decided in favour of assessee.

Summary

Issues:
1. Calculation of Central Excise duty based on Annual Capacity of production.
2. Show Cause Notice proposing demand of duty.
3. Confirmation of demand of duty, interest, and penalties.
4. Interpretation of legal provisions in light of relevant case laws.
5. Decision based on the judgment of the Hon'ble Gujarat High Court.
6. Setting aside the impugned order and allowing the appeal.

Analysis:
1. The appellant was involved in the manufacture of M.S. Ingots, with Central Excise duty calculated based on the Annual Capacity of production as per the Induction Furnace Annual Capacity Determination Rules, 1997.
2. A Show Cause Notice dated 22.08.2002 was issued, proposing the demand of duty for a specified period under the said Rules, leading to confirmation of duty demand, interest, and penalties by the Adjudicating Authority through an order dated 03.07.2003.
3. The issue was considered in light of the decision of the Hon'ble Gujarat High Court in the case of Krishna Processors vs Union of India 2012, along with reliance on other relevant decisions by the appellant's Advocate.
4. The judgment emphasized the interpretation of legal provisions, stating that liabilities under Section 3A of the Act would not be saved by the General Clauses Act, and highlighted the impact of the omission of Section 3A on proceedings initiated under specific Rules.
5. Referring to the case of M/s Krishna Processors, the judgment concluded that liabilities accrued under specific Rules could not be enforced after the deletion of the charging Section without a saving clause, directing actions to be taken under regular provisions of the Act.
6. Consequently, following the decision of the Hon'ble Gujarat High Court in the case of M/s Krishna Processors, the impugned order was set aside, the appeal by the appellant was allowed, and the application for extension of stay order was dismissed as infructuous.