2017 (9) TMI 1969 - AT - Central Excise

Demand of differential duty - impurities like iron, zinc, magnesium etc. overemphasized - allegation is that appellant was deliberately showing impurities in the scrap and paying the less Central Excise duty on iron and steel scrap cleared during the period under consideration - Applicability of Board circular No. 1029/17/2016 CX. dated 10.5.2016 - retrospective effect - HELD THAT - The Board has issued a circular No. 1029/17/2016 CX. dated 10.5.2016 where a clarification was given on segregation of impurities like iron, steel, rubber , plastic, dust etc. in respect of brass scrap. The above circular is clarificatory in nature. So, it is applicable retrospectively. This clarification was not available at the time of adjudication. The issue should be decided in the light of circular. Hence, the impugned order is set aside and matter remanded to adjudicating authority to decide the issue afresh in the light of clarification issued by the Circular, but by providing the opportunity of hearing to the appellant - appeal allowed by way of remand.

Summary

Issues:
- Central Excise duty on iron and steel scrap
- Applicability of circular on segregation of impurities
- Retrospective application of circular
- Remand of the matter to adjudicating authority

Central Excise duty on iron and steel scrap:
The appellant was selling aluminum scrap with impurities like iron, zinc, magnesium. The department alleged that the appellant was underpaying Central Excise duty on iron and steel scrap. The appeal was filed against the order dated 30.11.2015 for the period 2011-2015. Both parties were heard, and it was noted that a circular issued by the Board clarified the segregation of impurities in brass scrap, which was deemed applicable retrospectively. The Tribunal decided to remand the matter to the adjudicating authority for fresh consideration in light of the circular, allowing the appellant an opportunity to present additional evidence.

Applicability of circular on segregation of impurities:
The Board's circular No. 1029/17/2016 CX dated 10.5.2016 clarified the segregation of impurities like iron, steel, rubber, plastic, dust in brass scrap. The Tribunal found this circular to be clarificatory in nature and applicable retrospectively. Since this clarification was not available during the initial adjudication, the Tribunal decided that the issue should be reconsidered in light of the circular. The impugned order was set aside, and the matter was remanded to the adjudicating authority for a fresh decision, ensuring the appellant's right to a fair hearing.

Retrospective application of circular:
The Tribunal emphasized that the circular on segregation of impurities should be applied retrospectively to ensure justice. Despite the circular not being available during the initial adjudication, the Tribunal deemed it necessary to consider the matter afresh in light of the clarificatory circular. This decision aimed to uphold fairness and provide the appellant with the opportunity to present additional evidence for a just determination.

Remand of the matter to adjudicating authority:
In conclusion, the Tribunal set aside the impugned order and allowed the appeal by way of remand. The matter was directed to be reconsidered by the adjudicating authority in accordance with the circular's clarification, ensuring the appellant's right to a fair hearing and the admission of additional evidence as per the law. The decision was dictated and pronounced in the open court, emphasizing the Tribunal's commitment to justice and due process.